2025 started with sharp value rises in Israel of shopper merchandise in addition to electrical energy and water charges, municipal taxes and the VAT hike to 18%. In such circumstances, tech managers are used to receiving calls for from workers wanting a wage rise.
Whereas this may increasingly occur on a job-by-job foundation for skilled workers with a historical past of educational and sensible excellence, the final pattern is the other: a continued decline in salaries and job provide in Israel’s tech business.
In line with Central Bureau of Statistics knowledge printed final week, the typical month-to-month tech wage in Israel fell under the NIS 30,000 mark in direction of the tip of final yr, after crossing above it for 5 months. In truth, in accordance with the Central Bureau of Statistics, 2024 is the primary yr in many who noticed no improve in salaries within the -tech business.
On the finish of 2021, the typical month-to-month wage in Israel within the tech sector was NIS 26,428. On the finish of 2022, as the worldwide tech disaster started, the typical month-to-month wage continued to rise to NIS 27,787 and by the tip of 2023, it has already reached NIS 29,826. However in 2024, for the primary time, the typical month-to-month wage shrank to NIS 29,736, after being above NIS 30,000 for a part of the yr.
In line with the Central Bureau of Statistics, the wage of software program builders fell to NIS 31,100, after already reaching over NIS 33,000 between June and September final yr, returning to the numbers typical of 2023.
The variety of workers within the sector is shrinking
In summarizing the typical wage in tech business, the Central Bureau of Statistics additionally counted the variety of workers within the tech sector, which is shrinking. After reaching 400,000 workers in most months of final yr, it has fallen again round 398-399,000 workers.
The identical is true of the core professions of high-tech: the variety of software program builders fell from 218,000 to 217,000 between final summer time and fall, and the variety of engineers and scientific R&D workers fell to a low not seen since final decade of about 50,000.
A comparability made by the Central Bureau of Statistics between the info of final November and the info printed earlier than the struggle reveals that there was a 33% fall within the variety of vacant jobs within the subject of community engineers, an 11% lower in jobs within the engineering and technician professions, a 5% lower in engineering jobs, and a 1% lower in software program improvement.
Ethosa tech placement company CEO Eyal Solomon thinks that as a result of the wage decline over the previous six months in Israeli high-tech has ranged from 3% to five%, “and contemplating the rise in the price of dwelling, it is a greater actual wage decline,” he says. “We’re in a time like no different, the place if previously workers had been used to the truth that a brand new job meant a pay improve in contrast with the earlier wage, it not exists.” In line with Solomon, “‘Full stack’ engineers (skilled engineers who concentrate on many duties from completely different facets of improvement) whose wage ranges from NIS 38,000 to 41,000, are signing wage contracts of NIS 34,000-35,000. Not way back, we noticed a firmware engineer who, in regular instances, earns NIS 50,000 a month, on a NIS 41,000 contract.”
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Solomon says signing on bonuses within the business have disappeared and the competitors for every worker, which was aggressive, not exists. “Recruiters say – if he isn’t thinking about becoming a member of, he does not have to, another person will come alongside. I do not keep in mind such a factor – not even within the dot-com disaster, the subprime disaster or the post-Covid disaster of 2022.
“In apply, when there are fewer startup firms and extra workers for every place, firms have a mindset that claims – how can I pay much less for every place.”
Timor Shabtay, a human assets, wage and advantages guide, explains that the market has change into extra selective. “These in a very good bargaining place handle to improve circumstances, however this isn’t a broad pattern however relatively focused changes, apparently. Wage declines may result from the firing of high-paid employees.
“As well as, at present there are new traits resembling The Huge Keep, that means workers who keep of their jobs as a result of financial uncertainty. Or Quiet Quitting, employees who do the minimal required and no extra. This goes hand in hand with the dearth of wage hikes.”
Revealed by Globes, Israel enterprise information – en.globes.co.il – on February 24, 2025.
© Copyright of Globes Writer Itonut (1983) Ltd., 2025.
