The Knesset Labor, Welfare, and Health Committee has approved raising the minimum wage from NIS 5,000 to NIS 5,300 starting on December 1, in accordance with an agreement between Histadrut (General Federation of Labor in Israel) chairman Avi Nissenkorn and Manufacturers Association of Israel president Shraga Brosh.
The new increase will be the fourth in the past three years. In December 2014, the Histadrut and the employers' organizations agreed on a three-stage increase in the minimum wage from NIS 4,300 to NIS 5,000, with the final stage taking place in January 2017. After Brosh began his current term as president of the Manufacturers Association, he and Nissenkorn agreed on an additional increase to NIS 5,300, the extension of which to the entire economy has now been passed by the Knesset.
Histadrut figures show that there are 800,000 families in Israel with at least one breadwinner who earns the minimum wage. There are also thousands of public sector employees who are paid the minimum wage.
Nissenkorn, who took part in the Labor, Welfare, and Health Committee's deliberations, said, "The minimum wage in Israel has risen by 23% in the span of just two and a half years - an increase of almost one quarter. This is a historic rise by any standard since the Minimum Wage Law was passed in 1987, in addition to the significant improvement in the situation of low-paid workers. The increase in the minimum wage helped push up wages at all levels, with positive consequences for the middle class."
Nissenkorn added, "The measure we pushed for in our dialogue with the employers and the Ministry of Finance eventually also led to a faster increase in real salaries in Israel, which rose 10% during this period, following 15 years of stagnation. The threat of unemployment, which was mentioned whenever we talked about increasing the minimum wage, has been shown to be unfounded. The unemployment rate in Israel during the period in question fell to a 40-year low of 4.1%."
Published by Globes [online], Israel Business News - www.globes-online.com - on October 24, 2017
© Copyright of Globes Publisher Itonut (1983) Ltd. 2017