Adva Center Report Reveals Growing Economic Inequality and Public Service Decline in Israel

A new report by the Adva Center published on July 12, 2026, highlights a shrinking middle class in Israel, worsening public services, and stark income disparities. The report shows that households in the top income decile earn an average monthly gross income of 85,218 shekels, which is 13.6 times higher than the 6,278 shekels earned by those in the lowest decile. Furthermore, 82% of capital income is concentrated among the wealthiest, with the top 10% receiving 58% of it. The report attributes these inequalities to long-standing government priorities favoring privatization, austerity, and disproportionate spending on settlements and security rather than civilian needs.

Public services are under severe strain, with healthcare budgets lagging behind OECD averages by about 26 billion shekels, and private health expenditures reaching 20.5% compared to the OECD average of 13.4%. Mental health services face a shortage of nearly 2,700 professionals, and early childhood education suffers from low government investment, leading to the closure of 518 daycare centers in 2024 due to staff shortages. The report also reveals that nearly a quarter of full-time workers earn low wages, with significant ethnic and gender wage gaps: Arab women earn the least, averaging 6,975 shekels monthly, while Ashkenazi Jewish men earn the most.

The report also addresses the plight of approximately 143,000 citizens displaced from their homes, mostly from southern and northern Israel, who face economic coercion to return amid inadequate long-term planning and support. Housing inequality persists, with 93% of top decile households owning homes compared to only 41% in the lowest decile. Renters in the lowest income bracket spend an average of 54% of their net income on housing, exacerbating economic hardship. The report’s findings come ahead of upcoming elections but are based on official data and reflect the Adva Center’s social agenda to reduce inequality and strengthen public services.