The 2008 Poverty Report by the National Insurance Institute, which covers the second half of 2007 and the first half of 2008, reports that two contradictory trends are continuing. On the positive side, the proportion of poor in Israel fell to 31.8% in mid-2009 from 32.3% a year earlier. On the negative side, deep poverty worsened by 2% compared with the previous year.
In other words, the gap between Israel's rich and poor widened further, and although the Gini coefficient, a measure of income inequality, was unchanged, the National Insurance Institute's disposable income index rose by 0.7%.
The Poverty Report states that Israel had 418,000 poor families in mid-2008, with a total of 1.63 million poor people, including 777,400 children.
The decline in the number of poor was due not only only to the rise in old-age pensions, a statistic which showed up in previous Poverty Reports, but also from an improvement in the situation of Israeli Arabs, and no change in the number of poor large families. However, the number of working poor continued to increase, mainly because of the increase in the number of jobs offered by job agencies and service contractors, and the increase in part-time jobs.
Nevertheless, senior National Insurance Institute and Ministry of Social Affairs officials know that the most worrying numbers cannot be found in this Poverty Report, but will appear in the subsequent ones. The economic crisis the erupted in the second half of 2008 led to a wave of layoffs, which has not yet crested, resulting in increased unemployment, whose consequences will appear in future reports.
Published by Globes [online], Israel business news - www.globes-online.com - on January 25, 2009
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