Executive Summary: Survey of Workers’ Financial Situation Two and a Half Years After the Outbreak of the Swords of Iron War

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A special survey released ahead of the Israel Democracy Institute's Eli Hurvitz Conference, 2026.

Photo by Miriam Alster/FLASH90

Main Findings

The current survey shows that although more than two and a half years have passed since the outbreak of the Swords of Iron War on October 7, a substantial share of the working population still reports that “their economic and employment conditions have been adversely affected by the war." The survey presents a troubling picture of a worsening economic impact across almost all population groups, reflected in rising shares of respondents reporting harm to their income and scope of employment.

As in the previous surveys, the current survey finds that the impact is particularly pronounced among the self-employed, most of whom report a decline in income and in the scope of their business activity. This highlights the high vulnerability of this group to emergency events, which leads to a sustained deterioration in their economic situation.

Consistent with previous surveys, the findings also show that the Arab population has been more severely affected than the Jewish population, and that their situation has worsened compared to previous surveys, in terms of income, scope of work, and liquidity. At the same time, it is important to emphasize that the current survey also finds a worsening of the economic situation among the Jewish population, particularly in scope of work and income.

In addition, residents of the Northern District who were not evacuated after the events of October 7 were found to have experienced the severe impact. Approximately 46% of them reported a decline in the scope of employment or business activity, around 51% reported harm to their income, and 38% reported that they had no liquid funds at all. These rates are significantly higher than the national average and than the rates in other districts.

The survey further shows that there is an inverse relationship between income level and the severity of the economic impact: the lower the income level, the higher reported rates of harm to income, reduction in the scope of employment or business activity, and liquidity distress. Alongside this, the survey indicates that the economic impact is no longer concentrated only among weaker groups, and that a worsening of the economic situation was also recorded among the highest income groups. These findings indicate that although high-wage groups enjoy relatively greater economic stability, the war in general, and Operation Roaring Lion in particular, have also affected them substantially. It follows that the economic harm has expanded to broader segments of the working population.

Significant disparities were also found by age group. As in previous surveys, the youngest age group, ages 20–24, and those aged 65 and over stood out as having the highest rates of income harm, with 60% reporting harm to their income and 55% reporting harm to their scope of work. The high rates of impact among young people are related to the fact that a significant share of them are employed in industries that were particularly affected by the war, such as tourism, entertainment, and leisure, as well as in temporary and less stable jobs. By contrast, among those aged 65 and over, the high rates of impact are related to the fact that a significant share of them in this survey work as self-employed workers, and are therefore more exposed to economic harm.

In this survey, a question was added examining how the public perceives the extent to which its income was harmed by each of the events that occurred during the six years since the outbreak of the Coronavirus – that is, from the COVID-19 crisis, through the Swords of Iron War, Operation Rising Lion, and Operation Roaring Lion. The findings show that among those aged 35 and over, the COVID-19 crisis is perceived as the event that caused the most significant harm to income, whereas among people under the age of 35, Operation Roaring Lion—the Second Iran War—is perceived as the event with the most negative impact. This finding is consistent with the fact that a considerable share of young people was, during the COVID-19 period in 2020, at relatively early stages of integration into the labor market, if they had entered it at all. In addition, residents of the Northern and Haifa Districts reported that the harm to their income resulting from Operation Roaring Lion was the most severe of the crises examined. By contrast, in districts farther from the areas of fighting, including Tel Aviv and the Central District, the COVID-19 crisis is still perceived as the event that caused the most severe harm to income.

Against the background of these findings, we call on decision-makers to act to create and strengthen economic support mechanisms for populations that have been more severely affected by the war. In particular,  focused attention is needed for the self-employed, the Arab population, residents of the north, young people, and low-income households. The survey findings underscore the need for targeted and sustained policy that will help stabilize the economic situation of households harmed by the prolonged war and prevent a further deepening of economic disparities.

The main findings are as follows:

Employment Status

  • Most respondents who reported that they had been salaried employees on the eve of the events of October 7 (89%) remained salaried employees at the time of the current survey (May 2026). However, a non-negligible share (6%) reported that they had been dismissed or placed on unpaid leave—a rate similar to that reported in previous surveys. In addition, approximately 2% reported that they combine self-employment with salaried employment, around 3% changed their status from salaried employees to self-employed workers, and approximately 1% are serving in the reserves.
  • Most of those who stated that they had been self-employed on the eve of the events of October 7 (88%) remained self-employed. However, a non-negligible share, approximately 6%, changed their status to salaried employees, and another 3% combine self-employment with salaried employment. Approximately 3% reported that their business had closed, a rate similar to that reported in previous surveys (2%).
  • Among respondents who had lived in northern localities evacuated due to the Swords of Iron War, 15% reported that they had been dismissed, placed on unpaid leave, or forced to close their businesses as a result of the war. This was the highest rate of all districts—three times the national average, and three times the rate among respondents from southern localities evacuated due to the events of October 7, which stood at approximately 5%.

Harm to the Scope of Employment or Business Activity

  • About one-fifth (21%) of salaried employees report that their scope of employment declined, by an average rate of 48% compared with the period before October 7, 2023. The share of salaried employees currently reporting harm to the scope of their position reflects an increase compared with the January 2026 survey, when the share stood at 17%, with a similar rate of harm (46%).
  • Most self-employed workers (64%) experienced a decline in the scope of their business activity, by an average rate of 51% compared with the period before October 7, 2023. The share of self-employed workers reporting harm to business activity is also higher than in the January 2026 survey, when about half reported harm to their activity (49% reported a decline, at an average rate of 48%).
  • At the same time, there was a decline in the share of self-employed workers whose scope of business activity increased: from 12% in January 2026 to 6% in the current survey.
  • There was substantial harm among the working Arab population: more than half (56%) experienced a decline in the scope of work, at an average rate of 56%. These findings reflect a consistent and troubling worsening trend: 48% reported a decline in the January 2026 survey, and 42% in the April 2025 survey.
  • Among Jews as well, the impact deepened: the share of non-Haredi Jews reporting a decline in the scope of work rose to 22% in the current survey (May 2026), compared with 17% in the January 2026 survey and 19% in the April 2025 survey. Similarly, the share of Haredim who reported harm to the scope of work rose to 19% in the current survey, compared with 12% in the January 2026 survey and 17% in the April 2025 survey.
  • Among workers whose wages before the events of October 7 were below the minimum wage, 36% reported that their scope of work had decreased, compared with only 17% in the group earning more than NIS 27,600—twice the average wage.
  • The employment impact deepened especially among older adults: 55% of those aged 65 and over reported in the current survey that their scope of work had declined compared with the pre-October 7 situation, whereas in the January 2026 survey this rate stood at only 27%.
  • The share of young people aged 20–24 who reported a decline in their scope of employment is also notably high, at 38%, similar to the January 2026 survey. Particularly striking is the share of young Arabs who reported a decline in the scope of their position: 66%, compared with 35% among Jews. In this context, it is important to recall that a decline in the scope of employment among young Arabs, and a sense of idleness, increase the likelihood of violent incidents.
  • Among all districts, residents of the north were affected most significantly: approximately 45% of residents of the north and 32% of residents of Haifa District report a decline in the scope of employment or business activity, compared with approximately 28% nationally.
  • The employment impact among respondents who, on the eve of October 7, lived in localities evacuated due to the Swords of Iron War deepened following Operation Roaring Lion: approximately 42% of them reported harm to the scope of employment or business activity, compared with approximately 26% in the January 2026 survey and compared with the national average of 28%.
  • Examining the findings of the current survey (May 2026) compared with the findings of the January 2026 survey makes it possible to assess the impact of Operation Roaring Lion, which began in late February 2026. This comparative analysis illustrates that the impact deepened following Operation Roaring Lion: 46% of residents of the north who were not evacuated after the events of October 7 reported a decline in the scope of employment, compared with 38% in the January 2026 survey, approximately two months before Operation Roaring Lion, and in the May 2025 survey, approximately one year before Operation Roaring Lion. In Haifa, the current rate stands at 32%, compared with 28% in the January 2026 survey; and among residents of the south who were evacuated due to October 7, the rate stood at 40%, compared with 23% in January 2026.
  • Around 58% of workers in tourism, entertainment, and leisure occupations reported a decline in the scope of their work following the war. Particularly high levels of harm were also recorded among workers in construction and agriculture occupations, with 49% reporting a decline in the scope of their work.

Harm to Wages or Business Income

  • Some 31% of all respondents report that their wages or business income remained lower than in the pre–October 7, 2023 period. This compares with 27% in the January 2026 survey, which was conducted about two months before Operation Roaring Lion. In addition, approximately 2% reported having no income at all, similar to the January 2026 survey.
  • Some 70% of self-employed workers report that their business income is lower than it was before October 7 or that they had no business at all. This rate is more than twice the share of salaried employees who report that their wages were harmed compared with their situation before October 7 (26%).
  • Some of 26% of salaried employees reported harm to their income as a result of the war. These figures from the field indicate a deepening of the economic-employment impact following Operation Roaring Lion, which broke out on February 28, 2026, and raise concern that we may remain in a new static situation, in which the population harmed by the war is left behind and unable to recover.
  • The average rate of decline in personal business income was also sharper among the self-employed (47%) than the decline in wages experienced by salaried employees who reported a decline (34%).
  • A relatively high share of low-wage earners reported harm to their income: 40% of respondents whose income had been below the minimum wage before the outbreak of the war reported a decline in their income or reported that they had no income at all, compared with 26% of those earning above the average wage.
  • A worsening was also recorded among the highest income group: whereas before the operation, in January 2026, the share reporting a decline in income stood at only 15%, in the current survey this rate rose to 26%.
  • The harm to wages or business income among Arab respondents is notably severe: 55% of Arabs who were working on the eve of the outbreak of the Swords of Iron War report a sharp decline in their personal income compared with their situation on the eve of the war, an average decline of 48%. This compares with 26% of non-Haredi Jews, who reported an average decline of 35%, and 24% of working Haredim, who reported a decline of 27%.
  • Some 68% of workers in entertainment, tourism, and leisure occupations report harm to their income, an increase compared with the January 2026 survey, when the rate was approximately 47%. The harm to income also deepened among professionals, with 37% reporting harm to their income, compared with 28% in the January 2026 survey.
  • About half (51%) of residents of the north who were not evacuated after October 7, and approximately 37% of residents of the north who were evacuated after October 7 and returned to their homes in the north only a few months before Operation Roaring Lion, report harm to their personal wages or business income, compared with a national average of 31%. It is important to note the gap between northern residents who were evacuated and those who were not evacuated, with the latter having been significantly more affected. Moreover, the share of those reporting harm to their income among those who were not evacuated after October 7 jumped from 43% before Operation Roaring Lion, in the January 2026 survey, to 51% in the current survey—an increase of 8 percentage points.
  • Compared with the January 2026 survey, the situation of workers across the country has worsened. In Haifa District, the share reporting harm to income stood at 44%, compared with approximately 29% in the January 2026 survey, conducted several months before Operation Roaring Lion. Among them, the share reporting that they had no income at all stood at 10% in May 2026, compared with 4% before the outbreak of the operation, in January 2026. This figure is five times higher than the rate reported in the full sample (2%).
  • About one-third (33%) of residents of Jerusalem District reported harm to their income, compared with 17% before Operation Roaring Lion, in the January 2026 survey. The share of those whose income was harmed in this district nearly doubled.

Severity of the Harm to Income — A Comparative Examination

As part of the current survey, we added a question intended to examine respondents’ perceptions of the relative severity of the harm caused by the various events experienced over the six years since March 2020, when the COVID-19 pandemic broke out.

  • Survey respondents ranked the COVID-19 crisis and Operation Roaring Lion as the events that caused the most severe harm to their income. Approximately 31% of all respondents reported that these events led to severe harm to their income. They were followed by the impact of the Swords of Iron War, with approximately 28% reporting severe harm to income, and finally Operation Rising Lion Lion, with approximately 26% reporting severe harm to their income. Naturally, the cumulative impact of all these events has been drastic.
  • For the self-employed, the most severe harm followed Operation Roaring Lion: about half of them (49%) reported severe harm to income as a result of this operation, compared with 45% during the COVID-19 crisis and 40% following Operation Rising Lion, the First Iran War.
  • Across all age groups above age 35, the COVID-19 crisis was ranked as the event that led to the most severe harm to income, with approximately 32% reporting severe harm to their income. It was followed by Operation Roaring Lion, with approximately 28% reporting severe harm to income, and then the events of October 7 and the Swords of Iron War, at 26%.
  • For Arabs, the most severe harm to income followed Operation Roaring Lion, the Second Iran War: 42% reported severe harm to their income, compared with approximately 36% following the Swords of Iron War, and approximately 32% following both the COVID-19 crisis and Operation Rising Lion.
  • About half (51%) of residents of the north who were evacuated due to the events of October 7 reported that Operation Roaring Lion and the Swords of Iron War led to severe harm to their income, compared with about one-third (34%) of residents of the south who were evacuated due to October 7 and 29% in the general sample.
  • For residents of the north who were not evacuated and for residents of Haifa District, Operation Roaring Lion was the event that caused the most severe harm to income among all the events examined since 2020. Thus, approximately 41% of residents of Northern District who were not evacuated and approximately 35% of residents of Haifa reported that Operation Roaring Lion led to severe harm to their income.
  • In districts farther from the areas of fighting, such as Tel Aviv and Central Districts, the COVID-19 crisis was ranked as the event that caused the most severe harm to income. In these districts, approximately 29% reported that their income was severely harmed during the COVID-19 period, compared with approximately 25% who reported this with respect to Operation Roaring Lion, which was ranked second.

Household Liquidity

  • More than two and a half years after October 7, about one-quarter of respondents report having no liquid funds at all, and 10% estimate that the liquid funds at their disposal would last for less than one month.
  • An especially high share of Arabs (41%) reported that their household had no liquid funds at all, compared with 18% among Jews.
  • Among those earning up to the minimum wage, 37% report having no liquid funds at all, and an additional approximately 11% stated that they had liquid funds sufficient for less than one month. Some 16% did not know how to answer.
  • As of May 2026, after the ceasefire in Operation Roaring Lion entered into effect, the liquidity situation of residents of the north who were evacuated due to the events of October 7 is worse than the national average: about one-third (33%) of residents of the north who were evacuated due to October 7 reported having no liquid funds, compared with approximately 23% of the full sample.
  • Among residents of the north who were not evacuated after October 7, the most severe liquidity distress was recorded: 38% reported that their household had no liquid funds at all, compared with about one-quarter (23%) nationally.

We hope that the findings of this survey, conducted as part of ongoing monitoring of the economic consequences of the Swords of Iron War—which broke out following the massacre of October 7, 2023—on the employment and economic situation of the working population, will assist decision-makers in shaping and directing economic assistance so that it reaches the populations most severely harmed.

About the Survey and the Sample

The survey was conducted among a representative sample of Israel’s working population—salaried employees and self-employed workers—who were employed as of October 6, 2023, on the eve of the outbreak of the war. A total of 1,202 respondents answered the survey, of whom 1,010 had been salaried employees before the war and 192 had been self-employed before the war. The maximum sampling error for the overall sample is ±2.83%, at a 95% confidence level. Among Jews it is ±2.65%, among Arabs ±5.3%, and among Haredim ±9.08%, at a 90% confidence level.

The questionnaire was formulated and the survey analyzed by the research team of the Center for Governance and the Economy at the Israel Democracy Institute, with the guidance of the Viterbi Family Center for Public Opinion and Policy Research. Data collection for the survey was conducted by C.I. Marketing Information. The data were collected between April 23 and May 10, 2026, approximately two and a half years after the outbreak of the war. A total of 972 men and women were interviewed online and by telephone in Hebrew, and 230 in Arabic.

In addition, one of the survey’s objectives is to examine the employment and financial situation of residents of the confrontation line who were evacuated by government decision and who participated in the labor market—either as salaried employees or as self-employed workers—up to the outbreak of the war, hereinafter: “residents of the north/south evacuated due to October 7.” To this end, a dedicated sample was collected of 102 respondents who had lived in localities evacuated by government decision, of whom 51 had lived on the eve of the war in evacuated northern localities and another 51 in evacuated southern localities.

 

Additional details about the survey sample are available upon request.