Israel Drops From 3rd to 20th in OECD Academic Attainment Over Two Decades

A report from the Chief Economist Division of Israel's Ministry of Finance reveals a significant decline in Israel's relative standing in academic attainment among OECD countries over the past 20 years. In 2000, Israel ranked third with approximately 41% of 25-34-year-olds holding academic degrees. By 2024, despite a moderate increase to about 47%, Israel fell to 20th place, below the OECD average. This decline is attributed to Israel's slower growth rate in academic degree holders compared to most OECD countries, with only Finland showing a lower increase.

The number of students enrolled in higher education in Israel grew from around 171,000 in 2000 to approximately 290,000 in 2024, a 70% rise. However, the annual growth rate slowed from an average of 2.6% to about 1.1% between 2020 and 2024, lagging behind population growth. Structural disparities among population groups explain much of this trend. Among non-Haredi Jewish men, enrollment stagnated at about 39% since 2010, reversing previous growth. Conversely, Arab men saw a significant increase, nearly doubling to 49.7%, credited to long-term accessibility programs and a five-year plan started in 2015. Haredi men also experienced growth to 39.5%, but at a slower pace.

Women consistently show higher participation rates than men across all groups, with current rates at 54% for non-Haredi Jewish women, 56.3% for Haredi women, and 69.9% for Arab women. While overall female enrollment increased, recent years show stabilization among Haredi and non-Haredi Jewish women, and a plateau for Arab women since 2023. The report highlights a persistent gap between Arab women and non-Haredi Jewish women.

The Chief Economist Division warns that Israel's decline in academic attainment could have significant economic consequences, given the wage premium for degree holders, which varies by population group, institution type, and field of study. Previous research indicates the highest wage premiums are among graduates in high-tech fields, regardless of institution.