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Enjoying unemployment benefits, young Israelis choose not to go back to work

Even as the economy almost fully reopens with the virus waning, low-paid workers are opting to stay home; demand for restaurant staff surges, Employment Service says

Shoshanna Solomon is The Times of Israel's Startups and Business reporter

Israelis at a cafe in Tel Aviv, on April 07, 2021. (Miriam Alster/FLASH90)
Israelis at a cafe in Tel Aviv, on April 07, 2021. (Miriam Alster/FLASH90)

Young Israelis are choosing not to go back to work, at least not at the expected rate, even as the coronavirus pandemic wanes and the economy is gradually getting back on track, the nation’s Employment Service Bureau said on Sunday.

During March the hospitality sector, including restaurants and hotels, along with leisure and trade, which largely employ young people, up to the age of 34, was allowed to almost fully reopen, the agency said in a statement.

In spite of this, the level of young jobseekers remained static at its February level, when greater restrictions were still in place, at 47.4% of the total number of people looking for work, the data showed.

The pandemic, which caused social distancing and lockdowns, saw a sharp rise of young people being furloughed. Those up to the age of 34 accounted for about half of all the jobseekers who registered with the unemployment service. The trade, leisure and hospitality sectors were those most significantly affected by the lockdowns, and they are mostly manned by young workers.

The unemployment benefits these workers get are similar to the wages they were making while employed, the bureau said. With these benefits having been extended until the end of June, young workers appear to be in no hurry to go back to their jobs.

The extension of unemployment benefits until the end of June has transformed them from a “safety net,” saving hundreds of thousands of jobseekers and employers from collapsing,  into a “barrier” that prevents workers from returning to jobs, Rami Garor, the head of Israel’s Employment Service Bureau, said in a statement.

To encourage the return of young people and other low-wage earners back to work, unemployment benefits from July should be allocated in a shorter and more differentiated manner, according to age and marital status, at declining monthly rates, the bureau said in the statement. Payments should be conditioned on active job-seeking efforts and participation in skills-training courses, the service said.

Because these young workers have not returned to work, the number of open jobs in the sectors they typically work in has surged in the past few months: from December to March the demand for kitchen staff has surged 36%, the data shows; for waiters and barmen has surged 208% and for cooks 218%.

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