INTEGRATING ARABS INTO ISRAEL’S HI-TECH SECTOR

Nazareth’s path to success is mainly due to the existence of the necessary infrastructure to attract hi-tech companies established by Wertheimer.

By JOE CHARLAFF
A class at Tsofen: students discuss a problem while explaining a technical point (photo credit: TSOFEN)
A class at Tsofen: students discuss a problem while explaining a technical point
(photo credit: TSOFEN)
OVER THE past two decades, even as Israel has developed a strong hi-tech industry, and earned the sobriquet “start-up nation,” much of its Arab population has remained on the outside. Arabs comprise 20% of Israel’s population, but only contribute to 8% of its GDP.
There are 5,600 Arab engineers in the Israeli hi-tech work force today, out of a total of 120,000, which is a far cry from a fair representation of Arab society’s 20% share of the general population, and is a missed opportunity for the economic development of Arab society, since the hi-tech industry is the primary driver of growth in Israel today: hi-tech generates almost half (42.3%) of Israel’s export revenue.
In their book “Start-up Nation: The Story of Israel’s Economic Miracle,” Dan Senor and Saul Singer list two major reasons for this lack of integration. First, because, unlike Jewish Israelis, Arabs aren’t included in mandatory service in the Israeli army, they are less likely to develop technology skills that the Israel Defense Forces inculcate.
Second, they do not develop the business networks that Israeli Jews do while serving in the army.
Tsofen, a non-profit organization operating in Nazareth and Kafr Qasem, founded by an Arab Israeli and a Jewish Israeli, has been successful in integrating Arab hi-tech workers into hi-tech companies, Israeli and international, through its tech programs.
Back in 2015, having understood the need to duplicate the successful model of Nazareth as an emergent Arab center for hi-tech industry and jobs, Tsofen’s founders, Sami Saadi (Co-CEO) and Smadar Nehab (Co- CEO at the time) set about working to make this vision a reality.
“Our goal was to increase the percentage of Arab citizens employed in hi-tech to at least 10% by 2025,” said Nehab.
Their unique model allows for the accelerated integration of Arabs into Israel’s hitech industries in the fields of programming, hardware development and information technology (IT), among others, by training Arab hi-tech workers in the Galilee and Triangle region, and simultaneously facilitating the establishment of hi-tech centers in new areas.
“Since Tsofen’s establishment, it is already making an impact,” says Paz Hirschmann, co-CEO. “Since 2008, Tsofen’s work contributed to a significant rise in the number of qualified Arab hi-tech engineers, from 350 to 5,600, and a doubling of the number of Arab students pursuing hi-tech degrees in academia.”
The number of Arabs employed in hi-tech has increased by several hundred percent.
Nazareth, the largest Arab city in Israel’s Lower Galilee, is slowly becoming the Arab Silicon Valley of the north.
In recent years, several start-up companies were established by Arab entrepreneurs in northern Israel – many of them look to Tsofen for hiring their employees.
The opening of Stef Wertheimer’s Industrial Park in Nazareth back in 2007 was a major catalyst for this growth and Tsofen certainly played an important part in this increase – and with the growth of the entire eco-system in general, in Nazareth, which now boasts around 20 hi-tech companies, including global brands such as Galil Software, Amdocs, Broadcom and Alpha Omega. Tsofen has also helped encourage entrepreneurship and a hi-tech community through its events such as Meet-ups and Mobile Mondays, now in its fourth year.
Nazareth’s path to success is mainly due to the existence of the necessary infrastructure to attract hi-tech companies established by Wertheimer.
Babcom Software’s human resources manager is quoted as saying that the firm is employing more Arabs now than in previous years. They hire graduates trained by Tsofen and ITWorks to meet its job requirements.
The company recently established a branch staffed entirely by Arab women in Daliat Al- Carmel, a Druze Arab town.
About four years ago, Amdocs, a global leader in software and services in the communications industry, opened a state-of-theart facility in the industrial park in Nazareth.
Of its worldwide employee pool of 22,000, approximately 4,500 of them are in Israel.
Tsofen realized the need to bring the government of Israel on board to take on the role, which he pioneered. No Arab locality had, at the time, ever received government incentives for the construction of hi-tech parks. Without such government incentives, it remained highly unlikely that any other Arab city would develop as a hi-tech center, which could compete with the established centers in Jewish cities. Nazareth now hosts around 40 hi-tech companies.
Various donors and foundations have provided 77% of Tsofen’s funding this year, including the US government, and just under 20% has come from the Israeli government.
Israeli government funding is set to rise to 38% in 2019, reducing the proportion from donors and foundations to 59%.”
According to Sami Saadi, co-CEO of Tsofen, international government support is US-based these days, through USAID and MEPI. “In particular our work in the Triangle, based in Kafr Qasim, has received MEPI support since 2015 of over $1 million.”
Saadi further explained that the US is supporting their activities because it sees it as a way not only to improve the standard of living in the Arab sector but also to promote Arab-Jewish cooperation and integration.
Since 2008 more than 11,000 participants have benefited from their various programs.
Among these are some 1,600 workers placed in hi-tech employment, 1,200 graduates of their high school program, around 800 training course graduates and Accelerator participants, and about 2,500 hi-tech industry professionals have participated in their conferences, Hackathons, Makeathons, meet-ups and other events. Three hundred volunteer mentors from a range of companies give their time to assist the same number of young Arab professionals who are taking their first steps in hi-tech.
“Tsofen won the three-year tender (2018- 2020) for hi-tech training and placement with the Ministry of Labor, Social Affairs and Social Services, after having demonstrated the effectiveness of our model in the previous tender period (2015-2017).
This is worth over 7 million shekels,” says Hirschmann.
“We continue with successful placement at companies, including Microsoft, Sandisk, Dell, Checkpoint, Intel, Galil Software, and dozens of other less well-known names.
And we continue to expand the base of companies with whom we partner in this way: in 2017 we placed candidates in jobs with 27 “first time” companies recruiting through Tsofen.”
One of Tsofen’s past students, Suha Bishara, 25 years old from Nazareth tells The Jerusalem Report, “I hold a Bachelor of Science (BSc) degree in Information Systems Engineering from the Technion, and have recently completed Tsofen’s Full Stack Development hi-tech training course, which was run in partnership with Amdocs and which took place August-October 2017.”
Suha said that Tsofen’s course helped her develop and implement a real technical project while using cutting-edge technology.
“Throughout the course I received oneon- one support and guidance from leading professionals in the field, which were not accessible to me as a student in academia” she added.
With the support that it is garnering, Tsofen is looking to replicate its Nazareth operations to three more locations over the next five years and also increase its network of employers. Companies where it has already successfully placed Arab workers include Amdocs, Microsoft, General Electric and Babcom Centers.
A number of Arab cities were analyzed in order to identify which had the bestequipped municipalities to maximize success, which had potential land available with easy access, and had access to appropriate Arab human capital. From this it was clear that Kafr Qasim – a town of 22,000 some 20 km east of Tel Aviv in the Triangle – was head and shoulders above its fellow Arab municipalities in terms of readiness for the challenge.
Tsofen – together with its partners – now approached the government to introduce their vision, based on Nazareth’s success.
This vision was immediately recognized as beneficial for all stakeholders: Arab society, the government, the hi-tech industry (which is chronically short of qualified engineers), and for the sake of promoting a shared society through the workplace.
“WE ESTABLISHED an interdepartmental team with the Ministries of Social Equality (which houses the Authority for Economic Development of the Arab Sector), Economy, and Finance, as well as the Prime Minister’s Office (which had supported the development of Government Resolution 922),” Hirschmann said. “There followed thousands of man hours of meetings between Tsofen executives and our partners with the government stakeholders, as well as with the municipality of Kafr Qasim, which we now began to work with.”
Tsofen has in fact been in Kafr Qasim for several years. Efforts to get hi-tech businesses to relocate to Kafr Qasim repeatedly floundered due to the lack of suitable available office accommodation.
A “quick fix” resulted in the city allocating a 600 sq m office space in the center of the city in which they will relocate and run a small hi-tech center – jointly with the municipal economic development company of Kafr Qasim – where there will be space for start-ups and hi-tech offices, along with the Tsofen Accelerator and a Cisco Hub. At present they are housed in temporary accommodation while the space is remodeled.
Says Saadi, “Hi-tech is the future of Arab society. It is the lever for economic equality we are thirsting for. Civil and ethnic equality are not enough. If we want to reach a joint civil society we must also have the economic equality.”
“In the coming decade our top priority is bringing hi-tech companies to Arab cities – especially Nazareth and Kafr Qasim.
This will not only support economic development in Arab society, but also – through bringing Jewish professionals to work in Arab environments – contribute to creating a shared society in Israel,” Hirschmann concluded.