Israel's unemployment rate falls to all-time low

The rate has steady declined by 0.1-0.2% a month since January.

Israel's unemployment rate fell to 5% of the civilian labor force in October 2011, an all-time low, the Central Bureau of Statistics reported today.

The Central Bureau of Statistics also revised its unemployment figures for the preceding months, indicating a steady monthly decline of 0.1-0.2% in the unemployment rate since January. The unemployment fell from 6.2% in January to 5.6% in May and 5% in October.

The figures are surprising, given that economic activity is declining, including by labor-intensive export-oriented manufacturing. However, the unemployment rate is the economic indicator with the longest time-lag in its response to changes in activity.

Many economists attribute part of the drop in the unemployment to bad reasons: more people are leaving the jobs market, as indicated by the previous labor survey, which lowers the unemployment rate.

Psagot Investment House Ltd. macroeconomics research manager Ori Greenfeld says, "These are problematic figures. The drop in unemployment could also be due to the fall in participation in the workforce, which mathematically reduces the unemployment rate. The Central Bureau of Statistics examines how many people are seeking jobs among people who really want to work. If people give up looking for work, the unemployment rate also falls. We're already in a slowdown. We should see the unemployment rate rise later on."

All the same, Minister of Finance Yuval Steinitz did not pass up the opportunity to celebrate, saying, "We are proud of the fall in the unemployment rate to the historic level of 5% - evidence of the success of the government's anti-crisis policy. To keep this achievement of low unemployment in the future, in view of the worsening crisis in Europe, we must continue to encourage investment and growth in the economy while scrupulously maintaining responsible fiscal policy."

Published by Globes [online], Israel business news - www.globes-online.com - on December 26, 2011

© Copyright of Globes Publisher Itonut (1983) Ltd. 2011

5 Comments
View comments in rows
Update by email about comments talkback
POST
Comments
Your name
Please insert your name
Content
Hyperlink in a new window Hyperlink Right Left underline italic bold Bulleted List Ordered List Face1 Face2 Face3 Face4 Face5 Face6
Your comment

Thanks
You comment was recieved and soon will be published.
In posting comments, I agree to abide by the Terms of Use
Globes encourages lively and frank debate, but posts that the editors consider merely abusive or otherwise inappropriate will be removed. Report inappropriate content
Thank you for posting your comment, which will be reviewed for publication.
Loading Comments...load
Load more comments
prices  picture: Tamar Mitzpi CPI up 0.3% in March

The index reading is a surprise, as analysts had estimated March inflation at 0.1%.

Slowdown will worsen

The vested interests that continue to claim that the economy is improving are deceiving the public, says Eyal Horowitz.

Can the US maintain growth after QE3?

Leading economists will discuss "The US: catch 22 the zero interest rate" at the "Globes" 2013 Israel Business Conference.

Twitter Facebook Linkedin RSS Newsletters