State of the Nation Report 2025 – Chapter: Education
حول الأزمات الحقيقيَّة والمُتَصوَّرة في جهاز التربية والتعليم
- The gap in per-student expenditure in pre-primary schools between Israel and the OECD has grown from 5% to 11%
- In contrast, per-student expenditure in primary schools is 2% higher than the OECD average
- Despite the narrowing of the gap, per-student expenditure in upper secondary education still stands at approximately 2% below the OECD average.
- There has been a large and disproportionate growth in the number of special education students and in their budget
- Every year about NIS 4 billion of the Ministry of Education budget is unused
- There has been a rise in the reserve budget accompanied by a lack of transparency and an absence of monitoring and oversight
Israel’s education system is facing an unprecedented increase in the number of students enrolled in special education. This reality has led to a situation in which a substantial share of the growth in the Ministry of Education’s budget is effectively tied to this area. In March of this year, the Shapira Committee’s report was submitted to decision makers, proposing a comprehensive systemic solution to address the challenge. Among its recommendations, the report emphasizes the need to reduce class size in general education in order to expand the inclusion of students with special needs in regular classrooms. As of today, however, the Ministry of Education has yet to make practical preparations to implement this recommendation.
In this chapter, Nachum Blass, Chair of the Taub Center Education Policy Program, focuses on three central issues: the Ministry of Education’s budget, the teaching workforce, and the Shapira Committee report. From a budgetary perspective, the analysis examines how the Ministry of Education utilizes its budget, its internal priorities, and how these compare internationally. With respect to human resources, the chapter takes an in-depth look at the perceived shortage of teachers in the system. The final part of the chapter addresses the Shapira Committee report, the implementation of whose recommendations could mark an important turning point for Israel’s education system.
Ministry of Education budget: Underutilization, dramatic growth in special education, and a lack of transparency in reserve funds
When examining spending per student as a share of GDP in international comparison, there is a clear upward trend in investment over time. In primary education, it has surpassed the OECD average, while in post-primary education, the gap narrowed from 5% in 2010 to 2% in 2021 (the most recent year available). In contrast, investment in pre-primary education has remained significantly lower, and the gap relative to the OECD has actually widened from 5% to 11% over the same period. This is despite research showing that investment at younger ages yields the highest returns.
Gaps in per-student expenditure as a percent of GDP between Israel and the OECD average, by education level, 2009/10-2020/21
Despite the consistent increase in investment, several fundamental problems are evident in the Ministry of Education’s budget. The first is a recurring pattern of failing to fully utilize the approved budget (the amended budget, as distinct from the original budget). On average, the shortfall is nearly 5% each year — more than NIS 4 billion (in 2025 prices) — a highly significant amount that could have been used for a range of important purposes.
Comparison across budget types, Original budget = 100
The second problem is the unprecedented growth in special education. Between 2020 and 2024, the number of special education students rose by 61% (compared to an 8.5% increase in total enrollment across the system). Accordingly, the special education budget for the 2024/25 school year increased by 26%, versus about 6.7% growth in the overall education budget.
The third problem is the expansion of both the visible and hidden reserve budget lines and the lack of transparency regarding how these funds are used — despite High Court rulings and the State Comptroller’s instructions to strengthen monitoring and oversight and improve transparency. In practice, there is currently no effective parliamentary or public oversight of this significant budget component.
It appears that although the ministry’s budget has continued to grow — indicating ongoing increases in education investment — much of the growth is concentrated in special education and in reserve items, a substantial share of which is directed to Haredi education. Fewer resources are allocated to system-wide improvements, such as improving teaching conditions or expanding services for all students. Moreover, Israel continues to face pronounced gaps in investment in pre-primary education relative to OECD countries.
The perceived teacher shortage crisis
One of the most frequently discussed issues in Israel’s public and media discourse on education is the alleged shortage of teachers. Yet there is no empirical evidence supporting the existence of such a shortage.
The study examined the issue from several angles. Comparing growth in the number of teachers with growth in the number of students between 2012 and 2024, it found that in Israel’s 20 largest cities, student growth was lower than teacher growth in every city examined — indicating no shortage at the locality level. Simulations comparing the actual supply of teachers in a given year with projected demand for that year, both overall and by taught subject areas, showed that in both cases the actual supply exceeds demand, and that the gap has widened over time. An additional subject-by-subject check to determine whether shortages exist in specific disciplines likewise found no teacher shortage.
At the same time, the study points out that the Ministry of Education’s published shortage estimates drop sharply as the opening of the school year approaches. At the start of the school year, the vacancy rate in this sector — which employs more than 200,000 workers — stands at under 0.2% of all positions. This is low compared to most OECD countries and can be viewed as normal turnover rather than a shortage.
According to researcher Nachum Blass, even if shortages exist in certain localities, specific schools, or for particular subjects, these are only localized gaps that the system manages to address — among other ways by recruiting high-quality teachers trained in alternative teacher-training tracks. At the national level, he emphasizes, there is no shortage of teachers, and he therefore regards this as a “perceived crisis.”
Implementing the Shapira Committee’s recommendations — especially reducing class size — could bring about a genuine turning point in Israel’s education system
The publication of the Shapira Committee’s recommendations in March 2025 may ultimately prove to be one of the most significant events in the history of Israel’s education system. The committee was appointed in 2023 to address the challenges arising from the rapid growth in the number of students eligible for special education services and to substantially increase the rate of inclusion of special education students in the general education system — currently about 60%, compared with over 90% in most high-income countries.
At an early stage of its work, the committee members recognized that the only way to address these challenges is by improving the educational environment and the quality of general education. As long as general education does not improve, parents of children with special needs will continue to prefer separate educational frameworks for their children.
The report presents two key recommendations that together constitute a far-reaching shift in approach. The first calls for a fundamental change in priorities — described by the report’s authors as an “inversion of the pyramid” — by placing much greater emphasis on pre-primary education. The second recommends reducing class sizes from pre-primary through ninth grade to an average of 19 students per class.
Class size can be reduced using the existing workforce
The report’s most dramatic innovation is its demonstration that class size can be reduced without a massive increase in the number of teachers — by cutting the number of teaching hours currently allocated per class, and without harming students’ academic or educational outcomes. In this context, it is worth noting that during the COVID-19 period, the Taub Center presented Ministry of Education officials with documents showing that it is possible to reduce class sizes using the existing workforce. This position was also presented to members of the committee and is, in essence, similar to the framework the committee ultimately recommended.
Nachum Blass, Chair of the Taub Center Education Policy Program: “Israel’s education system is currently facing a range of challenges, but not every issue it grapples with amounts to a crisis. The real and dramatic crisis is the enormous and disproportionate growth in recent years in the number of special education students and in the budget allocated to them, without a parallel increase in the share of students included in general classrooms. By contrast, the issue of a teacher shortage — which for years has remained on Israel’s public agenda — is nothing more than a perceived crisis that is not supported by objective indicators. I also believe that implementing the Shapira Committee’s recommendations — first and foremost, a dramatic increase in investment in pre-primary education and reducing class sizes by cutting the number of teaching hours allocated per class — will bring about a genuine revolution across Israel’s entire education system.”
Prof. Avi Weiss, Editor of the State of the Nation Report 2025 and Taub Center President: “The central challenge facing Israel’s education system is not only the volume of resources, but also their purpose and how they are allocated. The accelerated growth in special education is placing an ever-increasing burden on general education, and reflects an incentive structure that does not always serve the educational goal of including students with special needs in general classrooms for their benefit. These issues were discussed in depth by the Shapira Committee. What is needed is a broad shift in approach across the education system, including far-reaching measures to strengthen general education, enhance early childhood education, and reduce class sizes, as part of a long-term strategy aimed at high-quality education and social resilience.”
The Taub Center for Social Policy Studies in Israel is an independent, non-partisan socioeconomic research institute. The Center provides decision makers and the public with research and findings on some of the most critical issues facing Israel in the areas of education, health, welfare, labor markets and economic policy in order to impact the decision-making process in Israel and to advance the well-being of all Israelis.
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