Wall Street Journal: Because of the war on Gaza the prospects for the Israeli economy have become bleak
The Wall Street Journal published a report containing digital data regarding the state of the Israeli economy after the decline in workers following the war in Gaza.
The report stated that about 20% of Israeli employees aren’t working due to military service or moving to another place, and that the cost to the economy, due to the absence of Israeli workers, had reached about $3.6 billion by mid-November.
The report indicated that between 10% and 15% of the workforce in the technology sector, which is a driving force in the Israeli economy, was called to reserve service.
The Israeli army summoned about 400,000 reserve soldiers, and officials estimate that 250,000 Israelis have been transferred at least temporarily from their homes, especially from areas seen as vulnerable to attack, which prevents many from going to work.
The report also stated that the war is expected to directly contribute to the closure of about 30,000 small and medium-sized companies in various sectors.
The Wall Street Journal quoted Yossi Mekelberg, a Middle East affairs analyst at Chatham House, a London-based research center, as saying, Israeli companies don’t operate smoothly, and the Israelis don’t spend a lot of money, and this creates a cumulative effect.
As a result, the prospects for the Israeli economy have become bleak.
Last month the Bank of Israel lowered its growth expectations, estimating that the economy will grow by 2% annually – down from previous expectations of 3% annually in 2023 and 2024.
The Bank of Israel had also expected that total government expenditures due to the war would reach about $43.2 billion by the end of 2025.
