Eshkol Warns of Possible Widespread Unemployment; Appeals to Labor

Israel is threatened by widespread unemployment, involving loss of jobs for “thousands, perhaps tens of thousands” of Israelis in the coming months, unless the situation is changed by hard work and the surrender of luxuries, Prime Minister Levi Eshkol warned today.

Mr. Eshkol voiced this warning, bracketing it with stern appeals to Israel’s organized workers, in an address to the 19th national convention of Hakibbutz Hameuhad, the organization of kibbutzim affiliated with Achdut Avodah, the Mapai Party’s alignment group in Israel’s present coalition Government. The convention, at Kibbutz Yagur, near Haifa, is being attended by 400 delegates representing 24,000 persons living in 57 settlements throughout Israel.

Mr. Eshkol told the Israeli workers they cannot “pass the buck” on the current economic difficulties “to the rich and the capitalists.” Israeli’s workers, he noted, earn 70 percent of the national income. He voiced sharp criticism of industrial and other enterprises owned by Histadrut, the Israel federation of labor, which is the backbone of his own Mapai Party, and of firms owned jointly by Histadrut and the Government.

Too many enterprises of this type, he charged, “eat off the country,” being more interested in perpetuating the plants or jobs than in aiding the country’s economy. They cannot raise capital to enlarge industry, but keep going, he said.

“Only foreign investors, who quite properly insist on a fair return, could provide the means for Israel’s industrial growth,” he declared. “The State-Histadrut enterprises face serious problems, of which the human aspect is the most important, because they have built up a labor force that would identify itself with the job and the plant. In fact, they merely put forward big demands regardless of the plant’s capability.”

Continuing to castigate labor, Mr. Eshkol stated: “Wages in public industry are higher than those in private industry — but not the output — due to inflated expenses and low productivity. The public enterprises must be made more productive and more efficient. Work, morale, social benefits, output, norms and premiums — all of these cry for re-examination and for improvements. Otherwise, these public enterprises may have to close down.”