Israel - Poverty and wealth

Though Israel has a strong social record, as in most societies, inequality exists in different guises. In 1988, families in the upper 10 percent of household income received 8.4 times the share of the bottom 10 percent; in

Exchange rates: Israel
new Israeli shekels (NIS) per US$1
Dec 2000 4.0810
2000 4.0773
1999 4.1397
1998 3.8001
1997 3.4494
1996 3.1917
SOURCE: CIA World Factbook 2001 [ONLINE].

GDP per Capita (US$)
Country 1975 1980 1985 1990 1998
Israel 10,620 11,412 12,093 13,566 15,978
United States 19,364 21,529 23,200 25,363 29,683
Saudi Arabia 9,658 11,553 7,437 7,100 6,516
Jordan 993 1,715 1,824 1,436 1,491
SOURCE: United Nations. Human Development Report 2000; Trends in human development and per capita income.

1997, the share of the uppermost 10 percent increased to 10.6 times that of the lowest 10 percent. The 20 percent of households with the highest income increased their share of the national wealth while the share of the lower income households decreased. Nevertheless, the economic boom in the early 1990s has left the average Israeli better off. The GDP per capita has increased from US$5,600 in 1980 to US$17,500 in 2000, an increase only exceeded by Singapore and Hong Kong.

However, inequality between Israelis of different ethnic origins is deeply entrenched. The average incomes of Arab citizens of Israel are the lowest and have hardly changed over the last decade. The average income of Israel-born Mizrahi Jews (originating from Africa or Asia) are somewhat higher, increasing over the last decade, but the gaps between their incomes and those of Ashkenazi Jews (originating from Europe or America) did not change. The average incomes of Israel-born Ashkenazis are the highest and increase steadily. In 1997, Israel-born Ashkenazi salaried employees earned 1.6 times more than Israel-born Mizrahi employees and 1.9 times more than Arab employees, according the Central Bureau of Statistics. Israeli society also faces gender inequality, which are stronger among Oriental Jews and Arab Israelis. In 1997, women's monthly wages were, on average, 63 percent those of men. Women's hourly wages were, on average, 83 percent those of men. These figures show an

Distribution of Income or Consumption by Percentage Share: Israel
Lowest 10% 2.8
Lowest 20% 6.9
Second 20% 11.4
Third 20% 16.3
Fourth 20% 22.9
Highest 20% 42.5
Highest 10% 26.9
Survey year: 1992
Note: This information refers to income shares by percentiles of the population and is ranked by per capita income.
SOURCE: 2000 World Development Indicators [CD-ROM].

Household Consumption in PPP Terms
Country All food Clothing and footwear Fuel and power a Health care b Education b Transport & Communications Other
Israel 23 6 11 2 6 8 44
United States 13 9 9 4 6 8 51
Saudi Arabia N/A N/A N/A N/A N/A N/A N/A
Jordan 32 6 17 5 8 8 23
Data represent percentage of consumption in PPP terms.
a Excludes energy used for transport.
b Includes government and private expenditures.
SOURCE: World Bank. World Development Indicators 2000.

improvement over 1993 when women's earnings as a percent of men's was still 58 percent. The fact that many women only work part-time explains some of the gap in monthly earnings. Most salaried Israelis make less than the average wage; in 1996, 62 percent made less than 75 percent of average income. For about one-third of Israelis the labor market does not provide a decent living. Between 1979 and 1990, the proportion of Israeli families with poverty-level wages increased from 27.9 percent to 34.3 percent, according to the National Insurance Institute. This figure remained stable throughout the 1990s.

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