Israel’s cost of living among highest of developed nations, report finds
AP Photo/Oded Balilty
The cost of living in Israel is among the highest of the world’s developed nations, according to a year-end report published Wednesday by the Jerusalem-based Taub Center for Social Policy Studies.
The research center’s ‘State of the Nation Report 2017’ found that “price levels in Israel remain among the highest” of Organization for Economic Cooperation and Development (OECD) nations despite lower levels of unemployment and an increase in salary averages over the past year.
Israel’s price index was 23 percent higher than the average of OECD nations, the report said, higher than in the United States, France, Germany, and Luxembourg.
Only Scandanavian nations Switzerland, Iceland, Norway, Denmark, and Australia and New Zealand had higher costs of living, the data showed.
The report found that “housing prices continue to rise at a faster rate than rental prices, and there continues to be a decline in the return on owning an apartment” -- a likely unsurprising finding for Israelis struggling to cope with skyrocketing real-estate prices.
The report noted that 2017 saw an “impressive increase in consumption” and improvement in standard of living, driven by an increase in salary averages.
Nonetheless, the report predicted an overall economic slowdown in the long term due to a shrinking working-age population as well as an increase in population sectors with higher rates of unemployment and “whose skills are not compatible with the modern labor market” -- namely, Israel’s ultra-Orthodox and Arab-Israeli demographics.
With regards to the ultra-Orthodox, the report found increasing rates of employment, with the number of working ultra-Orthodox rising nine percent between 2008 and 2013, to 73 percent among men and 36 percent among women.
The report identified high rates of inequality between Arab and Jewish Israelis with regards to life expectancy, infant mortality, and education.
Despite Arab-Israeli life expectancy being the highest in the Arab world, at 79 years, it lagged behind the life expectancies of Jewish Israelis and the OECD average -- 82.7 years and 81.6 years respectively.
Infant mortality rates were also higher among Muslims in Israel, with 7.5 deaths per 1,000 births, compared to 2.7 for Jews, 3.0 for Christians and 3.4 for Druze.
Educational gaps between Arab-Israelis and Jewish-Israelis were particularly pronounced among men, the report found, stating that the greatest challenges facing the Israeli education system were bullying, ostracism, and reducing "severe inequality among students from different backgrounds."
Arab-Israelis make up around 20 percent of Israel’s population, and are descendants of Palestinians who remained after the creation of the State of Israel in 1948.
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"Despite Arab-Israeli life expectancy being the highest in the Arab world, at 79 years, it lagged behind the life expectancies of Jewish Israelis and the OECD average -- 82.7 years and 81.6 years respectively. Infant mortality rates were also higher among Muslims in Israel, with 7.5 deaths per 1,000 births, compared to 2.7 for Jews, 3.0 for Christians and 3.4 for Druze." It's not "also", it's "because". Work it out: according to these figures, if infant mortality were zero, life expectancy would be 85 years for both Arab Israelis and Jewish Israelis. Therefore the difference in life expectancy between Arab Israelis and Jewish Israelis is entirely due to the difference in infant mortality. It would be interesting to know what is causing that difference and whether that is being addressed.
From what I have noticed when I was inside Israel was that Israel needs to develop an “organic” private sector. Entrepreneurs need to develop business that meets people’s needs and can be modernized for the 21st century. From an economic aspect Israel still acts like it is trying to establish itself but smart investments in self sustainment mirrored with openness can start to drive down costs in living as competition and lower legal impediment are expanded. Israel has tourism, Israel has some exports, now it needs to expand services and provide a safe environment for capital and legal atmosphere for private development.