Press Release

Israel’s Future Labor Market will Further Widen Gaps Between Jews and Arabs and Reduce Gender Gaps

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A new study by IDI experts Prof. Yotam Margalit, Gabriel Gordon and Zak Hirsch of the Center for Government and Economics at the Israel Democracy Institute, published ahead of the 2022 Eli Hurvitz Conference on Economy and Society, finds that: Since the year 2000 the Israeli Economy is transitioning towards occupations in which the main tasks require high analytical abilities (Such as engineers, software developers and financial advisors), and to a lesser extent interpersonal abilities (Nurses or professional service managers). However, occupations which mainly require routine-physical abilities are diminishing, with a decrease of close to a third of workers within these occupations (from 30% to 20%).

The researchers analyzed close to one thousand occupations which included hundreds of indexes for each occupation. This information was provided by O*NET, a database developed under the auspices of the US Department of Labor, which aided in the categorization of different occupations by the various task intensities. These data were merged with multiple Israeli Labor Force Surveys conducted by the Israeli Central Bureau of Statistics (from 2000-2021), allowing us to analyze trends within the Israeli workforce over the past few decades.

To date, the conventional analysis of the labor market maps the educational characteristics of its employees (more demand for university graduates compared to those with only a high school education), or by occupation (more demand for lawyers and less demand for couriers). The research paper offers analysis according to the task approach - and examines the labor market in terms of required skills, both within the same profession as well as between professions.

For example, they analyzed the profession of couriers, which is still relevant today, but examined what is required of an individual who wanted to be a courier 20 years ago and what is required in the current labor market.

The findings point to a further deepening of the gaps between Jews and Arabs. Not only are Jews more likely to work at occupations which require higher analytical abilities, occupations which offer higher salaries, while Arabs are more likely to work at repetitive and physical / manual tasks, the gaps between the occupations which characterize each of the sectors have widened in the past two decades.

At the same time the findings point to a convergence among the different tasks between men and women, resulting in a reduction in the disparity between men and women.

The findings of the study prove for the first time, claims that have not been previously researched related to the types of tasks required by the labor market. The study indicates that technology and globalization have influenced the tasks currently required of workers at the macro level of the whole economy.

1. The gaps between men and women are narrowing (compared to 2001 when they were very large) – i.e. men and women are increasingly performing similar tasks

2. The gaps between Jews and Arabs are widening - more analytical tasks among Jews, and more repetitive and physical / manual tasks among Arabs.

3. On the macro level - the study shows that the Israeli labor market today presents more demand for thinking tasks and less routine and physical tasks.

4. The findings indicate a clear relationship between the intensity of repetitive tasks in the occupation and the chance that the employee will lose his job or move to work in another industry within a period of three years

5. The dominant component is the change in the composition of jobs in the labor market and less the change in the mix of tasks that characterize the occupations themselves.

6. The analysis predicts the employee's employment stability, employee productivity in the coming years and his chances of retaining a place for or replacing them.

7. The most similar equivalent in terms of these changes in the Israeli labor market is its counterparts in southern Europe (Spain, Portugal and Greece).