476,000 Israelis filed for unemployment since start of March

Employment Service head: 1 million Israelis could be unemployed by end of crisis

Rami Garor says a quarter of workers could be jobless, estimates 20% of those currently on unpaid leave will be out of work at end of the pandemic

View of closed shops in the empty Dizengoff Center, in Tel Aviv on  March 19, 2020 (Avshalom Sassoni/Flash90)
View of closed shops in the empty Dizengoff Center, in Tel Aviv on March 19, 2020 (Avshalom Sassoni/Flash90)

The head of the Employment Service said Friday that the number of unemployed people in Israel could reach one million if the coronavirus pandemic causes layoffs to continue at the same speed.

“If it continues at this rate, we will probably reach one million unemployed, a quarter of the workers in the economy,” Rami Garor told the Ynet news site. “It seems that 20% of those who are currently on unpaid leave will be unemployed at the end of the crisis.”

Garor added that his staff were working to ensure applications were processed in time for people to get payments ahead of the upcoming Passover holiday.

Israel has seen a surge in unemployment applications in recent weeks as the coronavirus pandemic wreaks havoc on the national economy and global markets.

Head of Employment Service Rami Garor interviewed on March 20, 2020 (Screen grab/Ynet)

Since the beginning of March, when the virus’s effects began to take their toll on Israel, some 476,000 Israelis filed for unemployment. In comparison, 25,576 new job seekers registered in February and 23,173 signed up in January.

On Wednesday, 66,000 Israelis filed for unemployment between 12 a.m. and 12 p.m. — 5,000 an hour — crashing the Employment Service’s website.

The cost of unemployment benefits in April is expected to be NIS 2 billion ($523 million), up from the current cost of between NIS 800 million and NIS 900 million ($221 million-$250 million) per month.

Closed shops and restaurants in Tel Aviv on March 15, 2020 (Miriam Alster/FLASH90)

The National Insurance Institute expects to see between 500,000 and 1.2 million Israelis unemployed due to the crisis, National Insurance Director Meir Shpigler said Wednesday.

The estimates mean an unemployment rate of non-self employed Israelis of between 13% and 32%.

Before the crisis, the service supported some 80,000 people on average.

It’s unclear if the average payment per person will change.

An Israeli wearing a face mask walks in the city center of Jerusalem on March 17, 2020. (Olivier Fitoussi/Flash90)

Meanwhile, the Finance Ministry forecast a drop in government tax income of as much as NIS 50 billion ($13 billion) from its pre-crisis projected income of NIS 330 billion ($86.6 billion), according to the Calcalist business daily, citing a Finance Ministry source.

The ministry expects a drop of NIS 5 billion ($1.3 billion) in tax income this month.

The Finance Ministry estimated Monday that the total damage to Israel’s economy caused by the coronavirus pandemic will amount to NIS 45 billion ($12 billion) and wipe out any projected growth for the year.

The estimate came after Prime Minister Benjamin Netanyahu announced new restrictions to stem the virus outbreak on Monday night, and before the Health Ministry announced new more drastic measures on Tuesday.

A man walks past a closed Castro store in the empty Mamila Mall in Jerusalem on March 16, 2020 (Olivier Fitoussi/Flash90)

Major employers released most of their staffs this week, including El Al, which put 5,500 workers — over 80% of its staff — on unpaid leave, and Castro, Israel’s largest closing chain, which put 6,000 on unpaid leave. The Tel Aviv Stock Exchange has joined other global markets and plummeted since the start of the crisis.

Israel has taken far-reaching measures to contain the virus and on Friday the cabinet authorized further stringent workplace restrictions, tightening the limit to just 30% of workers in both public and private sectors in a bid to slow the spread of the coronavirus.

The widened restrictions came after the Health Ministry voiced support for a total lockdown of the country. Treasury officials, by contrast, have been strongly opposed to a full shutdown.

The Health Ministry introduced sweeping new restrictions to curb the spread of the coronavirus on Tuesday, instructing Israelis not to leave their homes unless absolutely necessary, which were made legally binding and enforceable on Friday morning. The Transportation Ministry said it was reducing public transportation at night and on weekends.

Israel has banned gatherings of over 10 people, closed schools, forced all Israelis entering the country into a 14-day quarantine, and ordered the closure of all malls, restaurants and cafes (with takeout permitted) to contain the outbreak.

Israel has confirmed 883 cases of the virus as of Saturday morning.

An 88-year-old man died in Jerusalem’s Shaare Zedek hospital on Friday night from the coronavirus, Israel’s first fatality in the global pandemic, while several other patients were in a critical condition.

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