Half of workforce earns less than 6,451 NIS per month
According to latest survey released by CBS, 3,000 NIS difference between median and average income. Additionally: Women earn 66 cents for every dollar earned by men. 'Massive erosion of middle class in Israel,' professor says
The monthly median income of an Israeli employee was 6,541 NIS ($1,850) in 2012, according to the results of the Central Bureau of Statistics (CBS) survey on the household income published Tuesday. For the first time, the survey included the median income figure, and revealed a 29% gap between the median income and the pre-tax average monthly income – which stood at 9,149 NIS ($2,588) for 2012. Hourly pre-tax average income stood at 51.60 NIS ($14.60) an hour.
The figures present a picture of the Israeli workforce: The average employee age is 40.4, their average education level is 14 years, and their average work week is 42.4 hours.
51.4% of the workforce are male while only 48.6% are female. The average education level of men was 13.8 years while women averaged 14.2 years. In the lower percentiles, women make up a larger percentage of the workforce, though this difference diminishes as the level of wealth increases.
The data exposes a massive gap in earnings between the genders. Income for men averaged 10,953 NIS ($3,098) per month and 55.1 NIS ($15.59) per hour, while women averaged 7,244 NIS ($2,049) per month and 46.8 NIS ($13.24) per hour.
The median income for males last year was 7,774 NIS ($2,199) while the median income for females stood at 5,489 NIS ($1,522).
Thus, the average income for a salaried female employee is 66% that of a male employee; the hourly wage of a woman is 85% the wage earned by a man; and the median income of the discriminated gender lies at 70.6% of male median income.
Eitan, 28, of Petah Tikva holds a BA and works full time, earning NIS 5,300 a month. He still lives with his parents. "I have a car loan and insurance costs – not to mention fuel costs – that bite into my salary," says Eitan. "I need the car to get to work, so I cannot avoid that. My parents pay the phone bill and at home I live at their expense, at least when it comes to food. There’s no chance that I will leave their home because I would collapse economically.”
Prof. Danny Gutwein, a specialist in economic and social history at Haifa University and at the Social Economic Academy explained, "The middle class has a growing gap between wages and expenditure to maintain reasonable standard of living and it causes erosion of the middle class in Israel. Since the state is continually reducing the social services, the middle class needs with its low wages needs more and more social services.
"Israeli society is on a very dangerous slope. Privatization in Israel produces people who are not in control of their lives, they are desperate and living hand to mouth so they look for alternatives elsewhere."
However, according to Professor Gutwein, not everyone is desperate. "Everything is true except for a very small layer of hi-techers who of course, have of control over their lives and all this does not concern them. Every phenomenon I describe relates to the middle class public and not to the wealthy minority. Therefore we require quite a significant change here, because making Israelis poor and desperate is a profound social danger. It's no longer a matter of social justice, it is a matter of the very ability to hold the institutions of a modern and democratic state."
Wide gaps between Jews and educated Arabs
Segment analysis of the population shows the average income for a Jewish employee was 9,721 NIS ($2,750) and the median income was 7,002 NIS ($1980). Yet in the Arab sector, the average income stood at 6,029 NIS ($1,705) with a median income of 5,275 NIS ($1,492). Accordingly, the average income among Arabs was a mere 62% that of the Jewish population.
The disparity between the incomes of Arabs and Jews was more pronounced among those with higher education than among Jews and Arabs with less significant incomes.
The average monthly income for a Jewish male employee was 12,065 NIS ($3,413) compared to the 6,457 NIS ($1,826) earned by Arab males: A 46.5% gap. For women, the average per month income among Jews was 7,509 NIS ($2,124) compared with 4,977 NIS ($1,408) in the Arab sector: A 33.7% gap.
Executive income: 87.9 NIS per hour
The highest income was posted by executives which – at 18,021 NIS ($5,097) – was nearly twice the monthly earnings of an average employee. On the opposite end of the spectrum, the lowest monthly income was earned by unskilled laborers who brought in nearly half as much as a salaried employee – 4,675 NIS ($1,322).
Part of the gulf in earnings is explained by the difference in hours worked per week, with executives working 48-hour weeks while unskilled laborers worked 37.5 hours a week. However, a comparison of earnings per hour still found that executives earn 2.9 times more per hour than unskilled laborers.
As the education level of the employee rises, so does his salary: The average hourly income of an employee with 16 years of education totaled 76.7 NIS ($21.7) compared to 29.3 NIS ($8.29) for an employee with less than 9 years of education.
The figures published on Tuesday by the Central Bureau of Statistics were based on a sample of 10,205 employees representing approximately 2,720,000 employees in the Israeli population. During 2012, the Bureau surveyed 230 communities, and the sample population included all townships but excluding Bedouin communities in the south.
It is important to note that the figures for average income of an employee – released monthly by the CBS – are much lower. This discrepancy is due to the different reporting methods used by the separate surveys.
