The Economic Background of the Social Protest of Summer 2011

 The centrality of this group in the protests may be explained by trends in their socioeconomic position. Analysis of the period between 1995 and 2010 shows that in the five years prior to the summer of 2011, the income of the typical working family headed by a young Israeli-born Jew, relative to all Israeli households, declined to unprecedented levels.  The main cause was wage erosion among young adults.  This decline also occurred among those with higher education, and their chances of attaining an income in the highest quintile fell substantially, especially among women.  Among young Arabs and ultra-Orthodox Jews, both individual wages and household income – already very low in earlier years – declined even further.  Of all the population groups, only Russian-speaking immigrants improved their relative income position.  Overall in the period studied, there was a decline in the value of those advantages that previously assisted young families in Israel to attain a middle-class standard of living: higher education, two working partners, residence in the Tel-Aviv area, and being an Israeli-born Jew.  At the same time, the rising cost of housing has made income erosion a bigger problem.  The proportion of young adults living in their parents’ homes increased, and the share of young home-owning families fell.

This paper appears in the Center’s annual publication State of the Nation Report – Society, Economy and Policy 2011-2012.