Half a million out of work Israelis will be left without unemployment benefits by the end of July, leaving them with no source of income, Minister of Labor, Social Welfare and Social Services Itzik Shmuli warned Monday.
“This is a ticking bomb,” Shmuli said at a press briefing along with National Insurance Institute director-general Meir Spiegler.
Shmuli urged the Finance Ministry to extend the period that unemployment benefits can be claimed to help those who lost their jobs due to the coronavirus outbreak.
Although the Finance Ministry has previously granted extensions for unemployment benefits, earlier this month it announced it would not continue the practice into June. Special stipends to unemployed workers over the retirement age of 67, which were paid in March, April and May, will also no longer be provided.
According to an analysis by the National Insurance Institute, by the beginning of August 469,314 people will no longer be able to claim benefits and “will become newly poor,” Shmuli said. Of those, 70 percent are aged 27 or younger, he noted.
Unemployment benefits generally run from 50 to 175 days, based on how long the applicant was employed before losing their job.
Shmuli said two weeks ago that he had asked for a cabinet meeting to discuss the social and economic impact of the coronavirus but so far it had not been convened. He complained that the “coronavirus cabinet,” the panel of ministers charged with dealing with the virus outbreak, spends most meetings discussing the lifting or imposing of lockdowns.
“There are those who think that the economy will take care of itself,” he said.
A lockdown imposed in mid-March to curb the spread of the coronavirus brought the economy to a near-total standstill and by April over a million Israelis had either lost their jobs or were put on unpaid leave. Unemployment jumped from around four percent before the restrictions to over 24%.
Due to the virus crisis the Treasury had agreed to extend unemployment benefits during the lockdown period. Although there has been some recovery of the job market as the lockdown was eased in recent weeks, there are still over a million Israelis without work.
Rather than continue to extend the unemployment benefits, the Finance Ministry has sought to pay grants to employers who rehire those put on unpaid leave.
As the lockdown has been rolled back there has been a spike in new virus cases.
The ministers tasked with leading the government’s response to the virus outbreak voted on Monday to instruct the healthcare system to prepare for hospitals around the country to receive a potential additional 2,000 coronavirus patients needing ventilators.
Ministers also decided to raise the fine for failure to wear masks in public, from NIS 200 ($58) to NIS 500 ($145).
Those moves came as the Health Ministry announced that there had been 183 new coronavirus cases over the previous 24 hours, taking the total count to 20,869. One new fatality took the death toll to 307.