The link between interest rates and importing migrant workers

The directors of The Bank of Israel understand what the government refuses to acknowledge: the Israeli economy doesn’t generate jobs.

The directors of The Bank of Israel understand what the government refuses to acknowledge: the Israeli economy doesn’t generate jobs.

The decision of The Bank of Israel at the end of February to reduce interest rates to 0.75% clearly signals that the country’s economy is facing a crisis. Despite the obvious danger that such a reduction will further inflate the housing bubble, The Bank of Israel has determined that the need to support economical growth, create jobs and enhance exports is more pressing.

Raffi Melnik, a member of the Bank’s monetary committee, explained that in light of the global economic crisis, the sluggish growth of Israel’s economy and the continuing strengthening of the shekel, we are now in danger of entering a recession and of rising unemployment, especially among youth. This, he claims, is “graver and more dangerous than rising house prices.” Melnik pointed out that the annual growth in private sector jobs was only 1.9% in the past 12 months, compared to a 4.3% rise in the public sector.

The Bank of Israel’s decision to reduce interest rates reflects an assessment that Israel’s economy is facing a major crisis. This assessment seems to be at odds with the government’s position on the economy. Israel’s unemployment rate is the lowest in the OECD countries, and the Treasury Minister has announced recently that taxes will not be raised as planned, claiming that negative forecasts had not materialised.

It seems, though, that the directors of the Bank of Israel understand something the government refuses to acknowledge. According to the Bank’s decision, Israel’s economy does not generate jobs: “The main reason for the slow growth in private sector jobs in the past two years is an increase in the number of jobs held by foreign workers. The number of jobs held by Israelis has not grown during that period.” In the past two years the private sector has grown by 47,000 jobs, but 25,000 of these (53.3%) were taken by “legal migrant workers” – i.e. workers that have been imported under government-approved schemes.

The meaning of the data is clear: even though the economy is entering recession; even though the global economy is trudging along, putting export on a downwards trajectory; even though the private sector produces very few jobs – to say nothing of wages and employment stability – despite all this, the government continues to approve massive imports of foreign workers (including an unlimited number of care workers). The government has recently increased the number of foreign agricultural workers to 25,000.

In a discussion last month at the Knesset Committee for Migrant Workers, representatives of the Housing Ministry expressed their support for the demand by the Contractors Corporation to import a further 34,000 Chinese workers for the building industry (the present quota for construction migrant workers is 8000). This trend of massive importation of migrant workers contradicts the recommendations of professional committees, and it is incompatible with the market’s inability to absorb additional workers.

Each migrant worker who is absorbed into the private sector enriches his or her agency by tens of thousands of dollars. The migrants are enslaved in many ways, and their organized importation is illegal according to ILO labour covenants. Such importation of cheap labour comes at the expense of Israeli citizens who are condemned to unemployment or else forced to accept work at very low pay and under poor conditions. This is a result of unfair competition with migrant workers who are employed under exploitative terms.

Take, for example, the issue of Arab women. There is no dispute between the Bank of Israel and the government about the need to dramatically increase their participation in the work market. The government has set a target to increase the rate of participation of Arab women in the job market from 27%, today’s rate, to 40% by 2020; and has allocated hundreds of millions of shekels for this purpose. However, every year the powerful lobby of employment agencies, farmers and middlemen succeed in turning the government away from its course, dictating a further increase in the import of migrant workers.

Implementing the government’s policy would enable it to fulfil its target, and would enable 100,000 Arab women, who are at the moment unable to work for a variety of reasons, to find employment. If you thought that importing migrant workers in such an inhuman way affects only those workers and Arab women, think again. The decision of the Bank of Israel has made clear that the destructive results of giving in to extortionist claims by self-serving employment agencies affect us all.

* Published in The Marker 9.3.14 in Hebrew. Translated by Yaara Gregory. Photo: Nir Kafri





Fighting for peace and cooperation between Palestinian and Israeli workers in times of war

Following is a talk by Yoav Gal Tamir that was given to the Global Labour Institute School under the headline “Young Union Leaders Imagining International Trade Unionism”. The GLI gathering of 100 activists took place at the end of November near Paris. MAAN’s representative Yoav Gal Tamir talked about the union’s role today, after the October Massacre by Hamas and Israel’s retaliation. Tamir also emphasized MAAN’s unique role as a union that works in Israel, defends and organizes both Israeli and Palestinian workers.

The East Jerusalem Project

Solidarity across borders: residents of East and West Jerusalem work together in crisis and build the foundations of a common future

Jerusalem after October 7 is a city marked by suspicion and fear. The city economy has been hit hard, and many in both the Jewish and Palestinian communities prefer to avoid public spaces. In the immediate days after the war began, checkpoints around the city have been shut, cutting off the Palestinians living in the outskirts of the city. That would be around one third of the city’s residents who are left in a dire economic situation. Amidst this, dozens of organizations – both Jewish and Palestinian – begun working to provide relief. MAAN Workers Association (MAAN) joined the Jerusalem’s civilian Emergency Center, especially the branch set up for the East Jerusalem residents. Together, these organizations in both sides of the city create an enclave of sanity, bringing hope in solidarity.


אנא כתבו את שמכם המלא, טלפון ותיאור קצר של נושא הפנייה, ונציג\ה של מען יחזרו אליכם בהקדם האפשרי.

رجاءً اكتبوا اسمكم الكامل، الهاتف، ووصف قصير حول موضوع توجهكم، ومندوب عن نقابة معًا سيعاود الاتصال بكم لاحقًا

As an organization committed to the rights of workers without distinction of religion, race, nationality, gender, or profession - democracy is our essence. We strongly oppose the authoritarian laws that the extreme government of Netanyahu, Lapid, Bennett, and Smotrich is attempting to impose.

Without democracy, there are no workers' rights, just as a workers' organization cannot exist under dictatorship.

only a victory of the democratic camp will enable a discussion on the Palestinian issue and lead to an alternative solution to occupation and apartheid while ensuring human rights and citizenship for all, Israelis and Palestinians alike. As long as the apartheid regime persists, the democratic camp will not succeed in defeating Israeli extremists. Therefore, we work to involve the Arab and Palestinian society in the protest.

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