(And Why I Still Think the Cost of Living is the Elephant in the Room!)
The strange living situation that the coronavirus has thrust us all into has provided me with a little bit of pause for thought about how my aliyah (immigration to Israel) has gone.
Five years in, I?m now well past the ranks of the rookies ? although I?m still far from a veteran too.
I need to keep working on my business Hebrew ? although I?m making some great progress at the moment (check out my YouTube video below for some slightly unconventional ways to improve).
I?m ? to be transparent? unsure about whether it makes sense to continue living here (and have frequent thoughts about leaving!). (Side-note: Apparently so do many friends that have moved here ? perhaps we can agree to start talking openly about this and stop repressing it like it?s some sort of dirty secret?)
But ? paradoxically perhaps ? I find myself reasonably happy and fulfilled while doing so and thinking about what might be next on the agenda.
Oddly, once you move past the rose-tinted glasses phase, you?ll feel that this is how many native Israelis actually experience life: A strange and seemingly conflicting mixture of contentedness coupled with fundamental unease with the country politically and economically (or sometimes both at the same time).
In ?Israel vs. Ireland: My Thoughts After Five Years? I gave a? ?p?r?e?t?t?y? an extremely detailed overview of what I viewed as the pros and cons of living in Israel.
If you want to spend the next hour on Medium, feel free to check it out.
Ireland vs. Israel (As Places to Live, That Is!)
(About a month ago ? just when I was resuming my self-publishing voyage ? I wrote this rather detailed run-through of?
But assuming you have much better things to do, I could summarize it while on one leg as:
Good weather (almost) year round: a definite plus in most people?s book
- Great weather (and lots of sunshine)
- Good and very affordable healthcare
- Good food
- Falafel (it deserves its own mention)
- Good travel opportunities
Israelis are, by and large:
- Straight-talking and down to earth.
- There are comparatively flat hierarchies in the workplace.
- Israeli culture is fundamentally informal and Mediterranean in nature (although quite unfamiliar to those from more frosty Northern climes.)
- Vibrant startup ecosystem
- In Israel, it?s easy to lead a fulfilled Jewish life and (for Jews) to feel instantly ?at home? among people from a similar cultural background
- For religiously observant Jews, it?s also easy to follow Jewish religious law; Israel is a society that is built around it rather than one which shifts to accommodate it (this is more applicable in religious cities such as Jerusalem, where I live)
- As a split-off from the preceding point: being Jewish is mainstream/the norm in Israel (I grew up in Ireland and was the only Jewish student in my high school! For some feelings about how much not feeling like a fish out of water means to me, again, feel free to check out the Israel/Ireland post)
- Feeling of resettling the Jewish homeland / contributing to Zionism / being a small part of a larger historical enterprise / and being among the first generations of Jews in thousands of years to live, again, in Israel
? Dependent upon your martial status and gender:
- Israeli women
- Israeli men
Whether you?re here for a vacation or to stay, you can expect to burn through rather a lot of these
- Extremely expensive! CEOWORLD business magazine recently ranked Israel as the eight most expensive country in the world (original source). That ranking put Israel ?ahead? of the US, Hong Kong (yes, Hong Kong!), the US, and even Singapore.
- Property is particularly expensive and consequentially unaffordable for most young people ? at least those without massive family help. To compound the problem, down-payments in Israel are set by law at a minimum of 25%. Because of the disparity between salaries and the cost of housing, the average number of mortgage payments it takes to own a property is notably higher than in many other countries. (Source ? Taub Center for Social Policy Studies: ?It now costs 148 monthly salaries to buy a home here, compared with 76 in France and 66 in the U.S?).
- For the 91% of society that doesn?t work in ?high tech? (the technology sector) salaries that are not commensurate with the cost of living. Israel?s wage gap was recently found to be the highest in the OECD.
- Limited professional growth opportunities in many careers and outside of the startup and IT (?high-tech?) world.
- R&D centers excluded, relatively few large businesses and multinational companies have major footprints in Israel.
- Protekzia (the buddy system) which can make it hard for immigrants to get a leg up on the career ladder.
- By European standards, paltry vacation time (legal minimum 12 days) for those often meager salaries. A standard 45 hour work week to compound that.
- Middle Eastern haggling culture ? which can make it hard to ensure you?re being paid a fair salary
Minor / Only Sometimes Applicable
- Poor customer service is commonplace. Limited and ineffectual consumer rights to compound that.
- Extremely sparse tenant protection legislation. In Israel ? despite the government passing a law to attempt to ban this ? tenants are routinely forced to pay agent fees (plus VAT) solely in order to rent a property. This is because (shitat matzliach) landlords ensure that any prospect tenants signs a piece of paper ?hiring? the agent.
- The postal service often leaves a lot to be desired
- Freier culture, societal mistrust, and racism. Read my blog about working with Israelis to understand what I mean by ?freier culture? because it?s otherwise a tricky one to explain.
- Israel can seem very aggressive and loud compared to some more genteel climes. Perceptions of manners differ between countries, but ? in line with the stereotype ? many find that ?Western? manners are still often lacking here. (This piece outlines the dynamic well).
- The security situation (yes, I?m listing that as a minor drawback. Thanks to the advances that Israel has made in defense its impact on day to day life is far lesser than it was just a short decade ago).
- The increasingly right-wing nationalistic direction of the government ? and concurrently diminishing chances for peace. (Of course, this is some people?s cup of tea).
- In reality, Israel has always been partially a theocracy. (This is part of the reason why I find the country?s oft-touted ?the only democracy in the Middle East? claim a bit grating ? because, besides being all self-righteous, I don?t believe it?s ever been an accurate representation of Israel?s politics.) Public transport does not operate on the Jewish Shabbat (sabbath). This is particularly noticeable in Jerusalem where almost the entire (West) of the city shuts down for 24 hours. If you do not observe Shabbat (I try to), I can imagine that this can be enormously frustrating.
For the ultra-religious (and those with a robust commitment to Zionist) the call to stay in Israel trumps all the negatives
I would coalesce that even further to:
a) Unless you work for a foreign employer or as a software developer or are sponsored by family or are independently wealthy the cost of living ? and the rat race to get by (Hebrew idiom: ?to finish the month?)? is the hardest part of living in Israel. Just as I have friends who were unable to make a living here in the food service industry, I have friends who relocated to the Bay Area because even the most expensive part of the US offered a better salary:cost of living ratio.
b) There are other slightly annoying things about living in Israel (customer service that can be downright abusive, dirty supermarkets). But none of these are really deal-breakers. (In much the same way that you probably wouldn?t want to leave Ireland just because some people can be passive aggressive rather than in-your-face like Israelis).
c) If you?re not Jewish a lot of the benefits go out the window ? and there are things like the country closing down for Shabbat that will probably eventually drive you crazy. And to be blunt, these will only be the start of the difficulties you will encounter. So scratch that section from the ?pros? list. Although Tel Aviv is still a fun town whatever your religious persuasion ? particularly so if you are a simple hedonist. And if you?re making a good international salary there the fact that beer costs $10 a pint shouldn?t bother you too much.
d) Depending on the strength of your commitment to Judaism and Zionism none of the drawbacks may matter to you at all. Because I?m unashamedly in the ?Jews should live in Israel (if financially possible)? bracket I?m partially in this list ? although I have met many with much greater religious fervor than I. It?s also why I believe that those of us that share this viewpoint shouldn?t feel ashamed about pointing out Israel?s (current) flaws. How great would it be to rewrite this piece in 10 years and discover that none of the above apply?
A reading list about the cost of living
The Tel Aviv skyline
I therefore think that the major issue facing immigrants to Israel, like me, continues to be the cost of living.
In fact, I would go so far as to say that until it is normalized the difficulty of surviving in Israel economically ? much less living a comfortable middle class existence ? is going to continue to be the unspoken elephant in the room facing those looking to move to Israel. And especially those without generous and extensive family support and who are not among the 10% of the economy working in software development and related fields.
Because irrespective of one?s salary the cost of living is an equal opportunity discriminator ? plaguing both those that make great salaries in the pinnacle of the ?high tech? world and those on the other end of the spectrum struggling to make ends meet in the food service industry and making close to Israel?s paltry minimum wage (at the time of writing, 4,300 NIS / $1,200 / month).
In a country where the cheapest supermarket pizzas start at $5, new cars are subject to an 83% purchase tax and even IKEA furniture costs double what it does in Nordic countries there are simply always going to be a lot of expenses to keep up with whatever you do between nine and six.
In my view ? by making it financially difficult or impossible for many diaspora Jews to envision a fulfilled life in Israel ? Israel?s unsustainable cost of living represents a major betrayal of the key Zionist tenant that the country will forever be a sanctuary and safe haven for all Jews. Because ? despite the stereotype ? not all Jews are rich. And a society cannot consist of Java programmers and the working poor alone.
Therefore I say: let?s stop skirting around this issue and let?s work towards changing things. And let?s stop letting our government get off the hook and voting solely based upon fear and the security situation. Because financial stability is a form of security too.
Unfortunately, and despite the pervasiveness of the issue, the cost of living has been almost entirely disregarded during the three national election campaigns that have taken place in Israel over the last year.
But here are some telling clippings from the news that I keep on hand to explain the extent of this problem facing Israel society:
Nearly 25% of Israeli Households Live in Perpetual Overdraft, Says Report
This is the sixth year in a row of a longitude CBS survey of ownership of financial assets by households. The current?
Of the 97.5% Israeli households that have a bank account, 42% have been in overdraft for at least one month during the past year ? 1.1 million households accounting for about 4 million people, according to a new report published Monday by Israel?s Central Bureau of Statistics (CBS). Twenty-two percent were in overdraft 10 months or more of the year.
Sure you can make it in Israel – if your parents help, say economists
There’s an old saying among olim – immigrants to Israel – that if you want to make a small fortune in Israel, come with?
Unless they are in the top 20 percent of income earners, Regev told The Times of Israel, or unless they already own significant assets, a typical professional couple making aliya from abroad will likely never be able to save enough money for a down payment on an apartment.
Gilad Brand looked at consumer prices in Israel and found that relative to incomes, prices are higher here than in every OECD country except Japan
(Quote from Eitan Regev, Taub Center for Social Policy Studies).
It now costs 148 monthly salaries to buy a home in Israel, compared with 76 in France and 66 in the U.S.
Israeli parents forced to support adult kids
Kleiman is financially helping all of them. “My two older girls are very dependent on me right now,” she tells The?
A new study by the Taub Center for Social Policy finds that 87% of all Israeli parents help their adult children with finances.
The ?high tech bubble? inflates the national salary average, but:
Hi-tech sector exceeds 300,000 workers for first time
The percentage of Israelis working in the country’s hi-tech sector rose to 8.7% of the entire workforce by the end of?
The percentage of Israelis working in the country?s hi-tech sector rose to 8.7% of the entire workforce by the end of 2018, exceeding 300,000 employees for the first time, new statistics published by the Israel Innovation Authority (IIA) has revealed.
(Obvious corollary: more than 90% do not work in the sector!)
And the wage gap is quite striking.
Report: It pays to be an Israeli high-tech employee – ISRAEL21c
Tech employees and multinationals in Israel jump in latest IIA and Start-Up Nation Central report. Israeli tech firms?
High-tech workers in Israel earn an average ?22,479 ($6,534) a month, more than double the average of ?9,345 for workers in the rest of Israel.
And the cause of the low salaries outside of ?high tech??
Productivity per capita that has consistently ranked among the lowest in the OECD ? particularly among disadvantaged sectors of the workforce and in protectionist inward-facing industries that have been artificially shielded from foreign competition (at the time of writing no major international supermarket chain operates in Israel):
OECD: Weak labor productivity hampering growth of Israeli economy
The wide gap in GDP per capita between Israel and the upper half of OECD countries has not declined in the last decade?
And the root causes of the high cost of living?
Rampant monopolies, oligopolies accompanied by tight import restrictions and far-reaching government bureaucracy:
Monopoly nation: How a handful of firms control prices, hold Israelis ransom
If there’s one thing that Israelis hate, it’s being “freiers” – suckers. But it seems many consumers are when it comes?
My hope is that the issue will receive more political attention over coming years ? as the amount it does at the moment is extremely scant.
Together, let?s hope that Israel can work to reduce the high cost of living, encourage greater participation in the ?high tech? workforce, reduce income inequality, and make Israel a more affordable and equitable place.
Because only then, I believe, can it fulfill its mission of being the only true and everlasting home of the Jewish people ? whatever their economic status.