Rising interest rates, inflation drive employment among Haredi men to all-time high
Record 55.8% participation in workforce is still significantly lower than the national rate, and that of Haredi women
Cnaan Lidor is The Times of Israel's Jewish World reporter
Amid rising interest rates and inflation, the employment rate of Haredi men has reached an all-time high of 55.8 percent.
The data, which pertains to the first half of 2023, refers to adults aged 25-64. It appeared this month in a Central Bureau of Statistics file on the employment rates of Haredim — very religiously devout Jews — and Arabs, demographics with relatively high unemployment that successive governments have sought to decrease.
The 55.8% peak in the second quarter of 2023 constitutes a three-point increase over the same demographic’s employment rate in 2019, before the COVID-19 pandemic. Employment by Haredi women, which in 2019 was at 76.6%, has also been increasing overall, reaching 79.3% in this year’s second quarter, though it is lower than the all-time high of about 83% in the final quarter of 2022.
Whereas quarterly-on-quarterly reports show fluctuations, “employment for Haredi women is consistently high,” said Gilad Malach, director of the Ultra-Orthodox in Israel program at the Israel Democracy Institute and a lecturer at Bar-Ilan University. Employment by Haredi men is also rising in recent years, Malach told The Times of Israel Sunday.
Some of the increase in employment by Haredi men may be due to rising interest rates, which are driving up monthly mortgage payments. The average payment on a NIS 1 million ($270,000) loan has risen by $330 from early 2022, when the Bank of Israel’s benchmark interest rate was 0.1% (it’s currently at 4.25%).
Haredi families are especially vulnerable to this increase as they have an above-average share of the mortgage market and rely heavily on cheaper, variable-rate mortgages, Malach said.
The annual inflation rate of about 4% has further eroded Haredi families’ purchasing power, possibly driving more men to join the workforce.
Many Haredi men devote much of their waking hours to studying scripture while getting by financially on charity, government subsidies, and salaries earned by wives who, parental duties allowing, typically work only part-time jobs, earning far less than their non-Haredi counterparts. Some men also work off the books, not declaring the income to maintain their government subsidies and avoid paying taxes.
This reality, along with the sweeping exemption enjoyed by tens of thousands of Haredi men from the army and national service, generates resentment among many members of the non-Haredi majority. They object to state funding, obtained typically in negotiations between political parties representing Haredim and the rest of the political establishment, for projects that allow hundreds of thousands of Haredim to stay out of the job market.
According to the Calcalist newspaper, the current national budget, passed earlier this year by the ruling coalition of five religious parties and Prime Minister Benjamin Netanyahu’s Likud, includes a doubling of budgets for yeshivas, religious seminaries, to a total of NIS 2.4 billion ($657 million).
The employment rate among Arab men was 77.6% in the first half of 2023, higher than 73.4% in 2021, but lower than 79.7% in 2017, and lower than the overall employment rate of all Israeli men, 82%.
Employment among Arab women was 44.75% in the first half of this year, a major increase over the 39% of 2019, but significantly lower than the national employment rate of women, which is 75.6%.
