Average Economic Cost of Israeli Reservists Rises to 53,000 Shekels Monthly

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The Israeli Finance Ministry estimates the average economic cost of a reservist soldier at 53,000 shekels monthly, up 10% from 2024. The cost reflects lost productivity and other factors, with policy implications urging reduced reserve days and increased Haredi recruitment to save billions annually.

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Average economic cost of an Israeli reservist is 53,000 shekels per month, up 10% from 48,000 shekels.
Cost calculation includes lost productivity, experience, spouse impact, and deferred studies.
Jewish non-Haredi men are 36% of workforce but account for 83% of reserve-related absences.
Reservists aged 25-44 earn 42% more than non-absent peers, raising economic cost estimates.
Reducing reserve days and increasing Haredi recruitment could save billions annually.
Replacing 10,000 reservists with regular soldiers could cut costs by half, saving 2.7 billion shekels yearly.

The Israeli Ministry of Finance's Chief Economist reported that the average economic cost of a reservist soldier to the economy is approximately 53,000 shekels per month, marking a 10% increase from the previous 2024 estimate of 48,000 shekels. This updated figure results from a more detailed analysis of reservists' employment characteristics rather than relying on the general average wage.

The calculation of this economic cost includes four components: lost economic productivity, loss of seniority and experience, impact on the spouse's economic activity, and deferred academic studies. The study focuses on employed reservists and reveals that Jewish non-Haredi men, who constitute only 36% of the workforce, account for 83% of work absences due to reserve duty. Most reservists absent from work are aged 25 to 44, with 13% being students, higher than the 7% in the general population.

The average salary of reservists aged 25-44 who miss work is 18,841 shekels, 42% higher than those not absent. Consequently, the economic cost for younger reservists is now estimated at about 39,000 shekels monthly, and for older reservists (31-39 years) about 68,000 shekels. Female reservists earn less on average, leading to lower cost estimates of 27,000 shekels for younger and 37,000 for older women.

The research suggests two main policy implications: first, the IDF should reduce reserve duty days, as the number of reservists drops significantly after active conflicts but remains higher than pre-war levels. Second, increasing Haredi recruitment into regular service could save billions annually. For example, replacing 10,000 reservists with regular soldiers could halve the economic cost from 53,000 to 26,000 shekels per month per soldier, potentially saving 2.7 billion shekels annually.

The study refrains from directly addressing Haredi recruitment but highlights the significant economic benefits of such a shift, given the lower average income and employment rates among Haredi soldiers compared to current regular soldiers.

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