Press Release – not for publication until June 18, 7:00
The Taub Center for Social Policy Studies in Israel has published the third annual A Picture of the Nation – a booklet of original, unique, and user-friendly figures consisting of one graph, accompanied by a short explanation, on each page. The pamphlet presents a picture of Israeli society and its economy in a number of key areas: the cost of living, housing, inequality, the labor market, the shadow economy, the elderly population, education, and health. The booklet, based on Taub Center research, details where Israel is doing well, where improvement can be seen, and in which areas a change of direction is in order.
In addition to the pamphlet, Taub Center researchers have created interactive graphs, published here for the first time, that present topics such as the changes in wages from labor over time and poverty and inequality levels in Israel and the OECD.
Prominent findings of the Taub Center’s A Picture of the Nation 2015 report include:
- The rate of food imports is very low, and imports represent only 16% of total private food expenditure. Taub Center findings show that in other industry sectors, import rates are much higher: furniture (about 40% of consumption), footwear, clothing and personal items (about 70% of consumption), and household goods (about 80% of consumption). The barriers to importing food mean that the local food manufacturers are virtually without competition – allowing them to charge high prices for their products. (Page 7)
- In those food groups with the highest demand, such as meat, breads and grains, and fresh fruit and vegetables, the import rates are low. Competition in the food industry does not reach the food groups in highest demand. The majority of private food expenditure in Israel is on bread and grains, meat products, fresh fruit, milk products, and beverages – categories with especially low import rates.In contrast, food groups with especially high import rates, like sugar products and fish, represent just a small part of private spending on food. (Page 8)
- Haredim make use of larger mortgages than in the past to purchase apartments. The percent of apartments purchased by Haredim is relatively high, although over time, their ability to do so is decreasing. Among Haredim, the average level of monthly mortgage payments has risen in the past decade by 72%, even though the prices of the apartments that they purchase have risen by only 6% (due to a shift towards the West Bank). This indicates a significant dwindling of resources in the Haredi sector. (Page 5)
- On international achievement tests, the share of pupils who excel has risen and the share of weaker pupils has declined in contrast to the OECD trend. Between 2006 and 2012, the share of Israeli pupils who excelled on the international PISA exams rose slightly, and the share of weak pupils declined by about 7%. In contrast, in the OECD countries, there was a decline in the share of excellent pupils, and the share of weak pupils declined by only about 2%. Despite the improvement, the share of weak pupils in Israel is still high relative to the OECD average – about 29% in Israel versus about 18% in the OECD. (Page 50)
- Inequality among households in Israel is among the highest in the OECD, although the trend continues to show a decline. Inequality in disposable income (that is, after taxes, allowances and benefits) has narrowed slightly in the past few years, although it still remains among the highest among developed countries. According to Taub Center researchers, some possible explanations include: demographic differences between Israel and other countries, large income gaps in the labor market, and the low effectiveness of the governmental social safety net in narrowing gaps relative to other countries. (Page 18)
- Most of the income from rental properties goes to the wealthier segments of society. The top income quintile enjoys two-thirds of the income from rental properties. Taub Center findings show that for households in this top quintile, the average income from rent is about NIS 1,500 per month (double the income from rent of the other four quintiles). Taub Center researchers report that since the number of renters is higher among the lower quintiles, this only serves to widen the income gaps – rent money passes from the weaker economic groups to the stronger ones. (Page 20)
- Interactive motion charts: Changes in hourly wages: 1997-2011. The figure demonstrates the changes over time in hourly wages of workers across income percentiles – starting with a decline in overall wages during the course of the second intifada, a moderate rise in the following years, and then an additional decline that began in 2008 with the worldwide recession. The most striking trend is that the wages of the lowest percentiles rose more than others over the period, apparently due to rises in the minimum wage. In contrast, the hourly wage of workers in the upper percentiles only rose slightly compared to their 1997 level. (For the figure, click here and select “Wage Changes per Work-Hour.”)
- Interactive motion charts: Poverty and inequality rates. The figure shows data on poverty and inequality in Israel and other developed countries. The poverty rate in Israel has risen over the years (although there has been a slight decline in the past few years), and it is high relative to most of the developed countries, both for individuals and for families. Inequality among Israeli households is also very high relative to the developed world, and the trend indicates a long-term increase. In terms of depth of poverty (the distance of the average income of a poor family from the poverty line or how poor a poor family is), the situation in Israel is worsening – the average income of poor families in 1992 was 26% lower than the poverty line, and in 2010 it was 31% lower. (For the figure, click here and select “Poverty and Inequality.”)
To read the pamphlet on the Taub Center website, click here (password to open the document: taub2015). To receive a hard copy, contact the Taub Center.
Publication of this Press Release and the material it is based on is under embargo until 7:00, June 18, 2015
For details, or to arrange an interview, please contact Gal Ben Dor, Director of Marketing and Communications 054-464-2333.
The Taub Center for Social Policy Studies in Israel is an independent, non-partisan institution for socioeconomic research based in Jerusalem. The Center provides decision makers, as well as the public in general, with a big picture perspective on economic and social areas. The Center’s interdisciplinary Policy Programs – comprising leading academic and policy making experts – as well as the Center’s professional staff conduct research and provide policy recommendations in the key socioeconomic issues confronting the State.