Israel Sees 9% Rise in Unemployed Software Developers Amid Broader High-Tech Job Shifts

The number of unemployed software developers and application analysts in Israel increased by 9% over two months, rising from 7,950 in May to 8,650 in July, according to the July labor market report by the Employment Service. This rise is part of a wider trend in the high-tech sector, where total unemployed workers grew by 3%, or about 500 people, from 16,400 in May to 16,900 in July. Meanwhile, unemployment in other high-tech fields declined.

The report notes distortions in March and April data caused by a wave of unpaid leave during Operation Breaking Dawn, making it unclear if these changes represent a short-term fluctuation or a longer-term trend. The labor market continues to show a weakening of stronger economic groups and a strengthening of weaker ones. In July, the share of unemployed from higher socioeconomic clusters (8-10) rose to 20.4%, up 3.4 percentage points from July 2023 before the war, while the share from lower clusters (1-3) dropped by a similar margin to 37.4%.

In July, 8,100 summer layoffs were recorded, mostly affecting teachers and educators who are typically rehired after the school year. This seasonal unemployment is especially prevalent among the Haredi community. Overall, about 40,000 new job seekers registered in July, with summer layoffs accounting for roughly 20% of them. The number of unemployed high school teachers rose sharply by 43.7% from 2,300 in May to 3,300 in July, likely reflecting layoffs in Haredi seminaries.

The proportion of women among job seekers increased from 54.1% in June to 55.5% in July, with women comprising 58% of new registrants. Unemployment among the Haredi population rose by 24.4% in July, with significant increases in Haredi and mixed cities such as Modi'in Illit, Beitar Illit, Elad, and Beit Shemesh. Haredi educational institutions notably furloughed workers during recent conflict rounds.

Despite the rise in raw unemployment figures from 169,000 in June to 173,500 in July, trend data shows continued recovery from the effects of Operation Breaking Dawn, with job seekers decreasing from 177,600 in June to 171,600 in July. Labor demand also improved, with 150,200 job vacancies in May, an increase of 8,400 from the previous month, resulting in a tight labor market ratio of about four vacancies for every five job seekers. Employment Service CEO Einav Mishash described the overall picture as a labor market continuing its recovery process.