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Economy Strong, Poverty in Israel

Over the last several years, Israel has enjoyed economic growth and low unemployment. Unfortunately, that is not all good news. A report recently released by Israel’s National Insurance Institute and the Central Bureau of Statistics indicate that over 1.7 million people, or 23.5 percent of the population, live below the poverty line. Of the 1.7 million people living in poverty, 817,000 of them are children and 180,000 of them are elderly. In addition, one in five households is living at or below the poverty line.

In recent years, Israel has been seen as up and coming in the high-tech sector, drawing international attention. Even though Israel is seeing significant progress, The Organization for Economic Cooperation and Development (OECD) released a statement saying, “Israel’s output growth remains relatively strong, unemployment is at historically low levels…However, average living standards remain well below those of top-ranking OECD countries, the rate of relative poverty is the highest in the OECD area.” The report also adds that the poverty problem is affecting some groups more than others, “Among Arabs and in the rapidly growing ultra-Orthodox Jewish community poverty is over one in two, mainly due to low employment rates among Arab women and ultra-Orthodox men”

The OECD indicated that Israel surpassed some of the average measures of other OCED members; it ranked far below average in similar social themed categories. These categories included housing, education and skills, social connections, work life balance, environment quality, personal security, and civic engagement. Fixing some of these social problems could help alleviate poverty in Israel. Action that should be taken should target groups that are endemic with poverty and other related problems such as Arabs and the ultra-Orthodox Jewish community.

The OECD did offer several options for different solutions that could help alleviate poverty in Israel. One major suggestion was to improve education, especially in areas with severe levels of poverty. Another suggestion was to begin the process of pension and welfare reform to ensure that it is capable of coping with an aging population. Finally, the OECD favored sales tax increases over income tax increases so the tax does not become more of a burden on already cash-strapped families.

Colleen Eckvahl

Sources: Your Middle East, JTA
Photo: Ivarfjeld