Tech salaries in Israel fell 7% in 2020 - survey

Tech companies reported declines of 30% in revenues, which led many companies to release their less-established workers.

JANUARY 7, 2021 17:00

Illustrative photo of Israeli money (photo credit: MARC ISRAEL SELLEM) — Illustrative photo of Israeli money

(photo credit: MARC ISRAEL SELLEM)

Salaries in Israel's hi-tech sector fell by an average of 7% in 2020, the first decline in a decade, according to a survey by the Ethosia employment agency.

The average salary was NIS 26,260, compared to NIS 28,240 a year earlier, the company said. Meanwhile, the pandemic led to a "correction" in the number of new job positions available, with a 32% decline to just 11,000.

"As in previous periods of instability for the labor market, we are still experiencing a phenomenon in which companies find it difficult to find suitable candidates for some of the core positions, and the shortage of engineers continues to be a major difficulty," the report said.

Tech companies reported declines of 30% in revenues, which led many companies to release their less-established workers. However, the report noted, the tech ecosystem started to show signs of recovery by November, and Ethosia estimated that it will return to pre-crisis levels by June 2021.

The number of employees leaving their company voluntarily fell to just 6% during the pandemic the lowest level ever in 2020. In 2019, 11% of workers left, mostly for a higher-paid position, while in 2018, 13% of workers moved on.

Despite the year's challenges, increased investment in tech companies leaves room for cautious optimism, said Ethosia CEO Eyal Solomon. "Despite the adjustments made during the year in manpower, there is still an expectation of growth in technology companies." He added that many companies are investing more in recruiting good people for their IT departments as they recognize the need for a sharp and rapid transition to the digital world.

Cybersecurity is another growing field mentioned in the report. "It seems that the fear of hacking companies and organizations is rising, and rightly so, and we are seeing a trend of expanding cyber departments and information security in companies. It looks like there will be an increase in demand in the field in the coming year," Solomon said.

Data was collected from Ethosia's clients, who have placed 12,000 jobs over the past year.