The prospect of rising unemployment in Israel as the government attempts to slowdown runaway inflation was the subject of top level discussions here today. The participants included finance Minister-Yigal Hurwitz, Trade and Industry Minister Gideon Part and Social Betterment Minister Yisrael Katz.
They had before them a report showing that unemployment has increased recently but that the economy as a whole is far from a condition of mass joblessness. However, the ministers expect the number of unemployed to increase with the implementation of the light austerity budget for the next fiscal year. Hurwitz noted that so far only “packets” of unemployment have appeared. He said this meant that the phenomenon will not be widespread and can be controlled. The “pockets” of unemployment can be utilized to shirt workers from services to productive industry, be said.
The unemployment rate has beer stable so far. It stands at 3.7 percent of the work force, about the same rate as last year. However, it is expected that by the end of this month the number of jobless will exceed the number of jobs for the first time. The unemployed will number 28,000 against 18,500 job openings.
To forestall a more drastic rise in unemployment, the Cabinet has established an inter-ministerial committee empowered to transfer workers from service jobs to export oriented industries. There are presently about 315,000 workers in services and 298,000 in the export industry. The government wants to reverse that ratio. The ministers agreed to make funds available to retrain service workers for industrial jobs.
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