Changes in Israel’s Labor Market During Conflict

After over two years of conflict, Israel’s labor market is undergoing significant changes, particularly with a drastic reduction of Palestinian workers allowed to enter, dropping from around 100,000 to approximately 8,000 due to security concerns. In response, Israel has increased the influx of foreign workers, now totaling over 227,000, filling gaps in various sectors, including construction and caregiving. This shift is causing structural changes in the labor market, potentially leading to higher unemployment rates among Israelis. The ongoing restrictions on Palestinian labor are creating a financial crisis for Palestinian families and the economy, raising concerns about long-term implications.

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