The average salary of CEOs employed at government companies and corporations was NIS 32,000 per month as of 2004, five-times the average wage in the public sector, but just one-fifth of the salaries of CEOs of companies traded on the Tel Aviv Stock Exchange, according to a Bank of Israel report.
"From 1994 to 2004, the salaries of CEOs of government companies and corporations eroded relative to those of executives in the business sector," said Dr. Idit Solberg, an official in the Bank of Israel research department. "There was also a concurrent decline in the proportion of senior executives from the business sector appointed to management positions in government companies."
According to the Central Bank's research, senior executives in government companies who were appointed after previously serving in other positions in the public sector remained in their jobs for a shorter period of time than those who came from the business sector, indicating that these new executives view the job as a springboard into the business sector.
"This seems to prove that an attractive salary is not enough to keep good executives in the public sector over time, or to attract senior, highly capable managers from the business sector," the research concluded.
Following in step with this trend, the bank added that the average seniority of CEOs in government companies and corporations was about five years, significantly lower than that of their colleagues in public companies in the business sector, which, according to the bank's research, stood at nine years.
While every year during the 1994-2004 period saw 20% of CEOs of government companies change jobs, elections seemed to promote more stability as the number fell in years in which a general election was held, the bank noted. The average did not change based on whether Labor or Likud was in power, it added.