Since the brutal surprise attack against the terrorist organization Hamas, the State of Israel, there has been almost no incoming tourism to Israel. The foreign airlines canceled one after the other their flights to Israel, and with the exception of the Israeli airlines that operate, there are ten airlines active here in one way or another (among them Fly Dubai, Etihad and Bulgaria Minus Air) – an 80% decrease compared to normal days.
The last time the tourism industry experienced a similar situation during the Corona period, it was not that long ago. Modi has experience from the past, in the branch for help from the state, but according to them, the Treasury’s proposal is not sufficient.
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According to what exists, which does not distinguish between branches, a business at the highest level of damage – that is, shut down since the outbreak of the war – is entitled to a refund of 18% of what is its regularity. The second grant will be given to businesses for work with paid employees, Hai is the rate of damage to wages multiplied by 60% of the business’s wages.
“If by the end of the month there is no reasonable plan with the Treasury, we are expected to lose about 70% of the employees in the industry,” warned Yossi Fatal, CEO of the Chamber of Inbound Tourism Organizers in Israel, in a conversation with Globes. And with about 2,000 employees, this is an industry where each employee brings in an average of 1.1 million dollars a year for the state.
“We currently have zero luxuries, because there is no tourism and no flights,” notes Fatal. “The Ministry of Finance said in the finance committee that those who do not have a substitute, should take the profession out of business. If we embark on such a round now, no one will return to work in the industry. This is a professional workforce, only to train them afterwards is a process of 3-4 years. These are people who have critical connections abroad and understand the language, with connections to relevant parties.”
Yossi Fatal, CEO of the Bureau of Inbound Tourism Organizers in Israel / Photo: Eyal Yitzhar
The normality criterion
Fatal mentions that during the days of the Corona virus, “when everyone went out for alms very generous, we didn’t use it.” At the time, the state maintained the manpower with us – they covered 70% of employee salaries, and we covered the remaining 30%. Now, the budget outline presented to the committee offers 60% for employee retention, but we cannot work like that. Need 80%”.
In terms of finance, there is a clear difference: in contrast to the progress of the corona, where the state called on businesses to close their doors and for workers to stay at home – now the economic interest is that anyone who can continue to work, will do so. Even for those whose workplaces are disabled, the Treasury is not interested in subsidizing the application fees as during the Corona period – among reasons of budgetary cost.
“Even though we won’t have a penny in the coming months, we are asking the state to help us employ and preserve the profession. After all, the government has already recognized that we are essential to the economy,” says Fatal, “Incoming tourism is critical in the rehabilitation of the West Negev. We will help them build the news, and that’s what to bring the place back to life.
“We are the ones who brought life back to the country after the corona virus, tourists are the criterion for the normality of the country. Cities like Jerusalem, Tiberias, Nazareth, Acre and Safed without tourists, will not return to economic activity.”
Meanwhile, in the majority of companies in the Seb industry, layoffs or unemployment benefits are not carried out, and most of all, the vacation days of the employees are used. In the Economic Committee, Fatal accused that “the lack of an emergency plan (for times of crisis) is done on purpose. Don’t leave us alone in front of the bureaucracy after the war.”
“pull a solution from the hip”
Not only the incoming tourists are in trouble, but also the outgoing tourism workers. Torres Hoika, for example, is one of the largest private social workers in Ashkelon, and 90% of the activity takes place in the city. “We feel that the state is neglectful,” says Shirley Cohen-Orakbi, the company’s vice president.
“The distorted mechanism established, according to which only companies with a turnover of up to 400 million shekels will receive compensation, ignores the reality of companies like ours, which are hit twice: both by complete shutdowns of the tourism industry, and by the shutdown of the call center in Ashkelon, which is the center of our activity.”
The optimistic estimates speak of a return to normality for the industry only in the spring of 2024, and according to her, “low profit margins in the industry make the insurance threshold of NIS 400 million irrelevant at all. Furthermore. The real turnover of such a company is only about 10%-15%, that is about -40-60 million shekels at the moment everything has stopped.” In practice, it was decided to take 100 workers out of work.
Kobi Karni, from the Association of Travel Agencies and Tourism Consultants in Israel, tells Globes that the decrease in the number of people leaving Israel has reached 70%. “The most difficult problem is that we don’t know what to prepare for. Are we preparing for a month, months or three months?
“The plan they presented is really a joke, those who prepared it are amateurs in business management. There is no uniqueness to different sectors, certainly they don’t segment it. We are not being paid according to what we need, this is a proposal that will not allow us to work.
“It looks like they pulled the solution out of their pockets, and didn’t sit down with professionals. Neither parameter fits our market. The industry will have to send workers home, which is a shame. At least let us keep them for two or three months, maybe the situation will improve.”
Yoni Waxman, deputy chairman of the tourism company Ofir Tours, operates in both inbound and outbound tourism. He seeks to draw conclusions from the Corona period: “So, when the tourism industry was hit, many workers were fired to other industries. Even now when we go back to work, there will be no one to take care of customers.
“After a round of war, the inbound tourism industry is the first to be affected, and it takes a long time to restore the confidence of tourists to vacation in Israel. We expect the state to also help with marketing budgets and employee retention budgets, so that after the war we can return money to it through the tourists who will come.”
“We advised on employee mobility”
The Ministry of Finance understands that each branch has its own uniqueness, but according to them the proposed outline should provide a solution for the entire economy. The office emphasizes that their main concern is the actual workers, not the jobs, and that they invest. The Treasury’s fear is that people will pay workers to sit at home, instead of going to work.
The Ministry of Tourism stated in response that “the Ministry is in continuous contact with the industry, and receives regular updates on the services. As an immediate step, the Minister of Tourism Haim Katz instructed the operation officials to move employees between hotels for the benefit of preserving the workforce in the industry.
“In addition, compensation will be paid to the agents of incoming tourism for marketing operations they carried out to bring tourists to Israel until the outbreak of the war. The ministry has every assistance to the industry and to bring about recovery and a return to normalcy.”