The Israeli Central Bureau of Statistics reported a significant decline in average monthly wages in Israel for April 2024, raising concerns about economic stability in the country.
Preliminary figures reported by the specialized Israeli newspaper Globes show that the average wage fell to 13,270 shekels ($3,600), which represents a 6% decrease compared to 14,79 shekels ($3,820) last March.
Low monthly wages and the impact of inflation
The full numbers for last March were slightly lower than initially reported, according to Globes, which indicated that Real wage growth was affected Binflation, Despite the nominal increase in these wages over the past year.
The average wage rose by 4.4% annually between January and March 2024, down from the 7.9% growth recorded between October and December 2023, according to the same source.
Experts warn of greater repercussions
Economic analysts have expressed concerns about the decline in average wages, expecting this to indicate deeper economic problems.
“The significant decline in average wages raises red flags about the fundamental health of the economy,” Dr. Yossi Shashar, an economist at Tel Aviv University, told Globes.
“Inflationary pressures and the slow growth rate in various sectors, with the exception of technology, indicate potential difficulties in the future,” Shachar added.
Globes said that the decline in wages has led to calls for government intervention, at a time when labor unions and advocacy groups are urging policymakers to address the widening wage gap and implement measures to stabilize the economy, according to the same source.
“We need to take immediate action to protect workers’ livelihoods and ensure economic stability,” Leah Cohen, spokeswoman for the Israel Labor Union, said in a televised appearance.
Contractions and declines
The Israeli economy recorded a contraction for the second quarter in a row, according to data from the Government Statistics Office, and this exacerbates the burdens of the government, which seeks to support the local economy in various ways in the face of the repercussions of the ongoing war on the Gaza Strip for the eighth month.
The Israeli economy contracted – according to official data – in the first quarter of this year by 1.4% on an annual basis. The economy shrank in the last quarter of last year by 21.7%.
All of this indicates that the direct and indirect repercussions of the war are still limiting the growth of the economy, and placing their burden on the population of Israel, as the per capita GDP decreased by more than 3% on an annual basis.