The percentage of Israelis working in the country’s hi-tech sector rose to 8.7% of the entire workforce by the end of 2018, exceeding 300,000 employees for the first time, new statistics published by the Israel Innovation Authority (IIA) has revealed.
By the end of 2017, hi-tech employees – excluding communication sector workers – represented 8.3% of the total workforce, the IIA said, and during 2018, an additional 19,000 hi-tech positions were filled.
The data also shows that the number of hi-tech employees has continued to grow during 2019, exceeding 307,000 workers by May.
The software industry was responsible for a large share of the increase in employment, growing by some 14,000 employees in 2018 alone. A decline of 3,000 employees was recorded in the pharmaceutical manufacturing sector due to major layoffs by Teva, Israel’s leading pharmaceutical company.
“Increasing the number of workers in the hi-tech sector is an important task in light of the industry’s contribution to the State of Israel’s economy and exports,” said Economy Minister Eli Cohen. “In order to continue to lead in this field, we must strive to retain Israeli innovation and brains in the country, and provide them with the right platform to staff the many hi-tech jobs on offer.”
Despite surging employment, a study published in December by the IIA and Start-Up Nation Central revealed that Israel’s tech innovation sector is growing faster than the local supply of talent, leading to a shortage of approximately 15,000 skilled workers needed to fill open positions.
While demand for tech talent is rapidly increasing, the supply of programmers, scientists and engineers has lagged behind. Some 15% of positions in the Israeli tech sector remained unfilled.
In order to nurture future hi-tech industry growth engines, the IIA said it is investing NIS 500 million (approx. $142m.) annually in the life sciences industry, an area in which it says Israel has yet to realize its full potential.
“The rate of employees in hi-tech has stood at about 8% for a decade, but for the first time we see a real positive trend in this figure,” said IIA chief executive Aharon Aharon. “We are working to significantly increase employment in hi-tech and innovation-led companies across all sectors, so that a larger proportion of the nation’s citizens enjoy high-quality and high-paying jobs. We have taken on an ambitious and challenging task, and this positive trend is the welcome product of the joint activity of several government ministries.”
According to the Central Bureau of Statistics (CBS), the average monthly wage of a hi-tech employee in March stood at NIS 25,912 ($7,370). The average salary among all Israeli employees was NIS 11,140 ($3,168).
Unemployment in Israel declined sharply from 4.1% in June to 3.7% in July among Israelis aged 15 and over, the CBS said on Monday.