Israel’s Ministry of Finance chief economist Shira Greenberg has issued a survey of salaries in Israel during the Covid pandemic. The analysis found that the average salary rose by 6.4% in real terms over two years, after taking into account the impact of Covid on the mix of jobs.
The report said, “In annual terms this rise reflects a real annual rise of 3.2% compared with an average annual rise of 2% between 2011 and 2019, that is to say the rise in salary was at a relatively high rate during the past two years.”
Israel’s average salary rose 2.3% in 2021
According to the Central Bureau of Statistics the average monthly salary in 2021 was NIS 11,773, up 2.3% from 2020.
The Ministry of Finance has several suggestions as to why salaries rose during the Covid crisis. “Global demand for tech services after the outbreak of the Covid pandemic led to salary rises in Israel’s high-tech sector.”
Another reason offered was in effect a criticism of the government’s furlough payments scheme for those on unpaid leave. The Ministry of Finance believes that the temporary fall in the supply of employees, due to the government’s policy on coping with the spread of the virus, and concerns about employees not wanting to be infected, also contributed to salary hikes.
The salary rises were not across the board, the Ministry of Finance found that the rises were lower in the catering and accommodation sector while in entertainment, leisure and art, salaries fell.
Even though 3.2% is a handsome annual rise in salary by the standards of recent years, it is still below the 3.5% that the Consumer Price Index (CPI) has risen over the past 12 months. In 2020, the CPI fell by 0.7%.
Published by Globes, Israel business news – en.globes.co.il – on March 27, 2022.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2022.