5770 saw Israel back on ‘growth path’

Industry, labor market look upbeat for 5771.

Money 311 (photo credit: Bloomberg)
Money 311
(photo credit: Bloomberg)
On the eve of 5771, Israeli industry is rebounding from the global economic crisis and the labor market is recovering.
“Over the course of 5770, industry returned to a growth path,” the Israel Manufacturers Association said in its annual report. “Industrial production in Israel grew 14 percent in 5770, recovering from a decline of 6.5% in 5769. The fast growth encompassed all sectors, but it was mainly driven by growth in production and exports in hi-tech.”
Industry sales in 5770 (September 2009 to September 2010) totaled $93 billion, with the chemicals, electronics and food industries accounting for 60%.
Industrial output in hi-tech surged 20% in 5770, after falling 1% in 5769, powered mainly by pharmaceuticals.
“Despite the renewed growth, the level of output in traditional industrial sectors has not yet returned to levels just before the global crisis,” the report said.
Output in mixed-traditional industrial sectors rose 16% in 5770, following a decline of 15% in 5769. Output in traditional industrial sectors rose 4%, after falling 6% in 5769.
Industrial growth was led by exports, which rose 20%, after contracting 7% in 5769.
All industrial sectors had double-digit growth in exports. Eighty-five percent of the surge in exports was generated by hi-tech and mixed-hi-tech sectors, which grew 20% and 32% respectively.
Israel’s economy will grow by 4.1% in 2010, compared with 0.8% in 2009, the Central Bureau of Statistics said in a report Monday. The Bank of Israel is predicting growth of 3.7%. However, the central bank is expected to revise its growth forecast upward next month.
The statistics bureau said exports would increase 13.1% this year, after falling 12.5% in 2009.
Growth in industrial production and exports has led to renewed hiring. In 5770, industry hired 12,000 new employees, following layoffs of 21,000 workers in 5769.
There are 354,000 employees in industry, earning an average gross monthly salary of NIS 11,354, which is 40% higher than the average wage in the business sector and triple the minimum wage.
Renewed growth in the economy over the past year also helped to bring about a recovery in the labor market.
“5770 was a year of recovery for the labor market,” Employment Service director Yossi Farhi said.
In 5770, the number of job seekers dropped 7.9%, from 224,200 in October 2009 to 206,400 this July. During the same period, the number of applicants for unemployment benefits fell 0.3%, from 119,800 to 119,300. Demand for new workers increased 14.1% to 26,700 in July, compared with 23,400 in September 2009.
The unemployment rate in the second quarter declined for a fourth consecutive quarter to 6.2%, from 7% in the first quarter, falling to the lowest level since the third quarter of 2008, when it was 6%, the statistics bureau reported.