Press Release

Bank of Israel's Karnit Flug: 'Ensure More Ultra-Orthodox Males Receive a Complete Secular Education'

Israel is 33% less productive than most OECD countries and we are not on target to close this gap, she adds

Israel's GDP is 40 percent lower than that of the U.S. and its level of productivity is 33% less than most OECD countries, according to a presentation by Dr. Karnit Flug, governor of the Bank of Israel.

View the full survey presentation from today's session>>

Speaking at the first session on the second day of the Israel Democracy Institute's Eli Hurvitz Conference on Economy and Society, Flug said a "far-reaching strategic plan" is required to close this gap, including increased secular education – math, English, science – for the ultra-Orthodox population. Ultra-Orthodox men currently receive the equivalent of a 10th grade education compared to the rest of the Israeli population.

Further, Flug noted that Israel – in-line with most of the rest of the world – has an aging population, expected to increase by 52% within the next 15 years.

The Bank of Israel presented the beginnings of a strategic plan to deal with this population, which was presented by Prof. Nathan Sussman. The plan involves increasing retirement age in Israel by one month per year over the next 12 years, from 62 to 64. If women retired just two years later, they would receive an average additional 400 NIS per month, according to Sussman.

Currently, retirement age in Israel is earlier than in the majority of OECD countries.

MK Eli Cohen, head of the Knesset committee for economic reforms, said that the government is working on a plan that would increase affordable housing for seniors and increase the number of private and competitive pensions available on the market.

Both Anath Levin, deputy CEO of the Credit and Investment Division for Clal Insurance Ltd. And Dr. Udi Nissan, chairman of Delek The Israel Fuel Corporation, Ltd., noted that increasing the retirement age for women was not enough. Rather, the wage gaps between men and women represent an additional retirement challenge and called on proactive measures to solve this problem.

"The more we put this off, the more difficult it will be come to address," Nissan said.

View the full survey presentation from today's session>>

Related release: 38% of C-Suite Businesspeople Don't Believe the Business Press is Truly Independent

About the Eli Hurvitz Conference on Economy and Society
The Eli Hurvitz Conference on Economy and Society (formerly the Caesarea Forum) will take place May 24-25, 2016 at the Dan Hotel (Lehi St 32, Jerusalem, 97856) and bring together leading economists, government ministers and officials, prominent business people, public servants, academic experts, and other top representatives from the public and private sectors. In total, there will be 70 people sitting around the able, engaging in deep, quality discussions and delving into the most important related topics on the public agenda.

This year, the conference will focus on the challenges of government and the economy, and the influence that political stability has on the ability of the government to advance reforms and impact the performance of the business sector and the effectiveness of civil service. It will also look at the right way to integrate innovation into the government ministries, the dynamic and rapid changes of the functioning of the workforce, the collapse of the financial market, the result of people retiring at older ages, and the role business press plays in Israel.