Average industry salaries seen rising 3%

Average monthly salaries in industry as a whole rose 1.3 percent in real terms to NIS 10,380 in the first quarter - 37% higher than the national average salary - while average monthly salaries in the hi-tech sector dropped by 0.9% in real terms to NIS 16,400. Nira Shamir, director of the Manufacturers Association of Israel's statistics and economic analysis division, who conducted the salary survey, forecasts that average monthly salaries in industry in 2006 will increase by 3% in real terms, up from 2.6% in 2005 and 2.2% in 2004. Shamir said several important factors were responsible for the continued rise in the average salary in industry in the first quarter of 2006. First, the continued rapid pace of expansion - 6% on a year-on-year comparison. A second factor was the rapid pace of hiring in the hi-tech sector of about 4%. Hi-tech workers characteristically earn higher than average salaries, compared with salaries in industry in general. A third factor was a sharp 4% rise in productivity (production per work-hour) by workers in industry, which affected salaries. The salary decline in hitech was attributed to lower wages in most areas of the sector, including electronic communications equipment, medical and monitoring equipment and transportation equipment. The electronic components sector, however, saw a 5% increase on average monthly salaries. The average salary in mixed hi-tech industries (chemicals and oil refining, machinery and equipment, engines and electrical equipment) rose by 2.5% in real terms to NIS 8,686 per month in the first quarter, compared with 1.9% in the same quarter last year. The highest average monthly salary of NIS 19,880 was registered in the electronic components sector. The lowest average monthly salary NIS 5,573, which is still 55% higher than the minimum wage was paid in the footwear and leather sector. Dr. Ozer Carmi, president of the Labor Relations Research Association of Israel said the continued rise of average monthly salaries in industry above the minimum wage was an important development for the economy as a whole. "However, more than the amount, the weak enforcement of the minimum wage and contractual conditions, in particular in the services sector and small businesses sector is still the main problem," he told The Jerusalem Post. Carmi will discuss problems and solutions of enforcement of the minimum wage at the 32nd Annual Conference of the Labor Relations Research Association of Israel on Wednesday. "For proper enforcement of the minimum wage, we need three elements: a strong government body of enforcement, involvement of the Histadrut and we need to raise the awareness and knowledge of employees' rights and how they can use them through a big campaign," Carmi said. "The public is ignorant, not stupid."