Unemployment down to 16.7% in February as economy reopens

The Israeli Central Bureau of Statistics said Monday that overall unemployment in Israel dropped in February from 18 percent to 16.7%.

That reflected a drop of about 50,000 unemployed people in Israel, from around 748,000 to about 698,000.

Much of Israel’s unemployment is attributed to the economic crisis caused by the coronavirus.

Israel started to reopen much of the economy during the past few weeks, as it vaccinated more and more of the population against COVID-19. Those reopenings, a major part of which started in late February, could account for the decline in jobless rates.

Israel  relaxed even more restrictions on businesses in March, as coronavirus numbers improved significantly. The Finance Ministry has predicted that 2021 will see the GDP grow at a rate of 2.8%-4.9% (depending on how severe coronavirus restrictions will be).

Business owners of the 5 different malls in the northern town of Rosh Pina stock up and prepare to open to the public, March 2, 2021. (Michael Giladi/FLASH90)

It also predicts that if the vaccination campaign succeeds and the economy can keep its recovery on track, the unemployment rate at the end of 2021 could be as low as 6.5%. It could then gradually return to pre-pandemic levels, when the unemployed were only 4% of the workforce.

According to the ministry, the GDP per capita of Israel in 2020 was 95.7% that of the country in 2019, reflecting the lower productivity during the pandemic and its lockdown periods.

The overall GDP of the country in 2021 is predicted to rise slightly and reach 97.9% of the 2019 GDP. 2022 is expected to show even more of a recovery, with GDP projected at 100.3% that of 2019 – indicating an economy that has surpassed that of the pre-pandemic period.