Just the facts

Labor force participation rates

Labor force participation rates (photo credit: Jerusalem Institute for Israel Studies)
Labor force participation rates
(photo credit: Jerusalem Institute for Israel Studies)
Labor force participation rates are calculated as the number of individuals actively involved in the workforce as a percentage of the entire working-aged population. The category of labor force participants includes those who are employed or are actively seeking employment. While there are a number of different ways to define the workforce, this column follows the definition of those between the ages of 20 and 65.
The economic effects of labor force participation rates play out on the individual, family, municipal and national levels. Studies done by the Bank of Israel have found that low labor force participation rates characterize those who have less education, haredi males with an extensive religious education, and Arab women. Low participation rates prevent the maximization of the country’s productiveness, lower the quality of life and increase the scope of poverty, as well as government spending on welfare benefits.
A comparison of labor force participation rates for 2009 (for those aged 20 to 65) in Jerusalem and Israel as a whole reveals significantly lower rates for Jerusalem (58 percent compared with 71%). Jerusalemites’ labor force participation rates lagged far behind the national averages for both the Jewish population (which includes non-Arab Christians and persons without religious classification) and the Arab population. The average participation rate for Jerusalem among the former group was 64% compared to a national average of 75%. Among the latter group, it was 47% compared to a national rate of 50%. The disparity between participation rates in Jerusalem and Israel as a whole is greater for the Jewish than the Arab population. This discrepancy might be explained by the distinct character of Jerusalem’s Jewish population, which includes a large number of haredim, a group with strikingly low employment rates among its male population. This reality impacts Jerusalem’s economy, as well as the pervasiveness of poverty among the haredi population.
On the upside, the situation offers tremendous potential for economic growth. There are many national and municipal programs aimed at incorporating more haredi men into institutions of higher learning for the purpose of helping them enter into the labor force.