•St

atist

ilite

93

Israel in statistics1948-2007

Population, by age, percentages, 1955, 2007

50151 510150

0-4

5-9

10-14

15-19

20-24

25-29

30-34

35-39

40-44

45-49

50-54

55-59

60-64

64-69

70-74

75+2 0 0 7 1 9 5 5

1c

2

• In 1948, 82% of the Israeli population was Jewish, and almost all of the rest was Arab. In 2007, 76% were Jewish, 20% were Arab, and 4% were non-Arab Christians and persons of other religious denominations whose religion is not recorded in the population registry (mostly relatives ofJewish immigrants who arrived in the 1990s).

• Jewish Israelis comprised 6% of the world’s Jewishpopulation in 1948, and 41% in 2007.

• The share of Israeli born persons out of the total Jewishpopulation increased from 35% in 1950 to 70% in 2007.

• Between 1949 and 2007, the share of Muslims out of the total Arab population increased from 70% to 83%, the share of Christians decreased from 21% to 8%, and the share ofDruze decreased from 9% to 8%.

• The median age of the population rose by four years – from 24.5 in 1955 to 28.7 in 2007. This increase was primarily the result of a decline in fertility. The average number of births per woman decreased from 3.9 to 2.9.

• The share of children (aged 0-14) in the population decreased from 36% in 1955 to 28% in 2007, whereas the share of elderly persons (aged 65 and over) increased from 5% to 10%. However, the share of children in the Israeli population has remained higher than in any other Western country, andthe share the elderly persons has remained lower.

•Along the years, the sex ratio of the population has changed. In 1948, there were 107 males per 100 females in the Jewish population. By 1955, there were 103 males per 100 females in the total population. In 1978, the sex ratio balanced out, and since then, there has been a female majority. Today, there are 98 males per 100 females.

1. PopulationNurit Yaffe

• The Israeli population grew from 806,000 in May 15,1948 (Independence Day) to 7.2 million at the end of 2007. It is projected that by 2030 the population of Israel will be 10million.

• Between 1948 and 2007, the population grew at anaverage annual rate of 3.8%.

• The population numbered 1 million in 1949, 2 million in 1958, 3 million in 1970, 4 million in 1982, 5 million in 1991,6 million in 1998 and 7 million in 2007.

Population and components of growth, 1948-2007

Population at end ofperiod (millions)

% of immigration

balance out of total

growth

Average annual

growth rate

7.2383.81948 – 2007

2.2658.21948 – 1960

3.1383.21961 – 1971

4.1202.41972 – 1982

4.661.81983 – 1989

5.6563.51990 – 1995

6.4392.61996 – 2000

7.2151.92001 – 2007

• Between 1948 and 2007, 62% of the overall population growth resulted from natural increase, and 38% resulted from migration balance – including changes in the size of the population due to changes in national borders. Since 1967, the population of Israel includes residents of East Jerusalem,and since 1982 – Druze and Muslims in the Golan.

Immigrants, thousands, 1948-2007

250

200

150

100

50

0

’48 ’58 ’68 ’78 ’88 ’98

• The Israeli population comprises one thousandth of the world population. It is similar to the population of Switzerland, and greater than that of Norway, Denmark, New Zealand and Finland.

1a

1b

1

’07

Average age at first marriage, by sex, 1970-2006 .1d

brides grooms

Life expectancy, by sex, 1971- 2007 1e

MenWomen

70.173.41971 - 197472.776.11980 - 198475.178.81990 - 199477.481.62000 - 200478.882.52007

Persons per square kilometer, 1948-2007 2a

Population by district, %, 1948, 20072b

2 0 0 71 9 4 8

100100

1210

1717

1221

2414

173614 2

4..

Total

Jerusalem District

Northern District

Haifa District

Central District

Tel Aviv District

Southern District

Judea and Samaria*

0

5

10

15

20

25

30

20052000199019801970 6נבחרות לקמ"ר , שנים נפשות מספר

050

100150200250300350

1948 1961 1972 1983 1990 2000 20067

3

• Between 1970 and 2006, the average age at first marriage rose by 2.6 years for grooms (from 25.0 to 27.6), and by 3.0 (from 21.7 to 24.7) years for brides.

• Despite the rise in the average age at first marriage, rates of marriage have always been high in Israel. In 2007, for example, only 6% of both males and females at ages 45-49had never been married.

• Since the early 1950s, life expectancy has risen by about 12.5 years for the Jewish population. Since the early 1970s, life expectancy of the total population in Israel has risen byabout 9 years.

• Infant mortality rate has dropped from 36.5 per 1,000 births in the late 1950s to 10.9 three decades later. During that period, the decrease in infant mortality was a major cause for the rise in life expectancy. By 2007, infant mortality ratewas 3.9.

• The population increase has been accompanied by an increase in the number of households, which rose from 766,000 in 1970 to 2.1 million in 2007. Similarly, the decline in fertility has been accompanied by a decline in the average size of households, which dropped from 3.8 persons in 1970 to 3.3 in 2007. The percentage of one-person households rose from 12% to 18%, and the percentage of households with seven or more members dropped from 11% to 6%respectively.

2. Geographical distributionNurit Yaffe

• The population growth has been accompanied by an increase in average population density – from 43 people per square kilometer in 1948, to 316 in 2007. The highest density was found in the Tel Aviv District (7,073 people per sq. kilometer in 2007), and the lowest density was found in the Southern District (73 people per sq. kilometer). Today, compared with European countries, Israel’s populationdensity is lower only than that of the Netherlands and Belgium.

• In 2007, the population was more evenly distributed between the districts than in 1948. The population of the Northern and Southern districts comprised 19% of the total population in 1948, and 31% in 2007, whereas the share of the population of the Tel-Aviv, Central, and Haifa districtsdecreased from 71% in 1948 to 53% in 2007.

*Population in Jewish settlements

• The increase in population size of the country as a whole was accompanied by an increase in the size of the localities in Israel. In 1948, Tel Aviv-Yafo was the only city in Israel with more than 100,000 residents. In 2007, there were 14 cities of that size, including five cities with more than 200,000 residents (Jerusalem, Tel Aviv-Yafo, Haifa, Rishon LeZiyyon and Ashdod).

3

Students in the Education System 1949-2007 3a

2 0 0 71 9 9 01949

2,2551,424141Total – thousands

100100100Percentages

182119Kindergartens

374472Primary

28287Secondary

321Post-secondary

5....Higher Yeshivas and Kolels

1051Higher Education

3b 12 graders entitled to a matriculation certificate who met university entrance requirements, percentages, 1995-2007

391995401996381997411998421999412000

442001452002462003442004462005462006452007

010,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

100,000

1948

19511954195719601963196619691972197519781981198419871990199319961999200220052007

Universities (Excl. the open 1st degree University), 1st degree 2nd degree יי 3rd degree יי

Academic and teacher training colleges, 1st degree Academic and teacher training colleges, 2nd degree

3c Students in institutions of higher education, by type of institution and degree, 1948-2007

%%

4

3. EducationRevital Cohen - Aviel Krantzler

• The level of education of the Israeli population has been constantly rising since World War II, as in other Westernized countries. The percentage of adults (aged 14 and over until 1985, and aged 15 and over afterwards) with no schooling decreased from 16% in 1961 to 3% in 2007; and the percentage of those with 13 or more years of schooling rosefrom 9% in 1961 to 42% in 2007.

• In 2006, the share of persons aged 25-64 with post- secondary or higher education was 46%, similar to Canada (47%) and higher than in other countries such as Japan (40%),the United States (39%), Denmark, and Finland (35%).

• The rise in the level of education is also reflected in the increased percentage of students in institutions of higher education out of all students – 10% in 2007, compared to1% in 1949.

• Between 1991 and 2007 (2006/2007), the number of teachers rose from 72,000 to 114,000. Of those, the percentage of teachers with academic degrees rose from 39% to 76%, and the percentage of teachers aged 50 and over rose from 12% to 26%. During the entire period, womencomprised over 75% of all teachers.

• Between 1990 and 2007, the average class size dropped slightly – from 28 to 27 students per class.

• School enrollment rates have risen continuously for boys and girls; the rates for girls have always been consistently higher than for boys. In 2007, 94% of the boys and 97% of the girls aged 14-17 were enrolled in school, compared to 86% and 92%, respectively, in 1994 (data for 2007 include students in apprenticeship schools under the supervision ofthe Ministry of Industry, Trade and Labor).

• The percentage of matriculation examinees out of all 12

graders increased from 72% in 1992 to 84% in 2007; the percentage of 12 graders entitled to a matriculation certificate increased from 46% to 53%, respectively.

• Most of those entitled to a matriculation certificate met university entrance requirements, and were thus potential candidates for higher education. In 1995, 39% of all 12 gradersmet these requirements, compared with 45% in 2007.

• In 1948, there were two universities in Israel. Five universities were established in the 1950s and 1960s, and the Open University was established in the mid-1970s. At the end of the 1970s, teacher training colleges became institutions of higher education rather than post-secondary institutions. During the 1990s, many academic colleges were established;in 2007 there were 62 institutions of higher education.

• There were 208 recipients of academic degrees in 1948,and 55,000 in 2007.

• In 2007, first degree students at academic colleges, including academic colleges of education, (approximately 93,000) outnumbered those enrolled in universities(approximately 76,000).

• In 1965, 31% of all first degree students were enrolled in the field of Humanities. By 2007, the percentage of students enrolled in the field of Humanities decreased to 12%. Concomitantly, the percentage of students enrolled

1 9 6 5 2 0 0 7

20061964

0 5 10 15 20 25 30 35

דהרוח

נוח

רההחד

פ

רפואה

דהותקה

חקלאות

הנדסה

19642006

3d First degree students in institutions of higher education, by field of study, percentages, 1965, 2007

0

10 ,000

20 ,000

30 ,000

40 ,000

50 ,000

60 ,000

70 ,000

80 ,000

90 ,000

100 ,000

19501955

19601965

19701975

19801985

19901995

20002005

2007

0

1 0

2 0

3 0

4 0

5 0

6 0

7 0

8 0

19551960

196519

7019

7519

8019

8519

9019

9520

0020

0520

07

men women

4a Persons in the labour force, by sex, percentages of allpersons aged 15+, 1955-2007

Engineering

Agriculture

Natural sciences and mathematics

Medicine

Law

Social sciences

Education

Humanities

0 5 10 15 20 30 35

5

in the field of Education rose from 2% to 17%, partly due to the academization of that profession, and the percentage of students enrolled in the field of Social Sciences rose from 21%to 31%.

• The share of females out of all first degree recipients was 43% in 1970, 50% in 1987, and 56% in 2007; of all second degree recipients, the share of females was 27%, 43% and 57%, respectively; and of third degree recipients, the share of females was 13%, 33% and 51% , respectively.

• The rate of national expenditure on education out of the GDP has varied between the mid-1960s and the early 1990s, from 7.4% to 8.6%. Between 1996 and 2002, the rate remained above 9.0%. National expenditure on education reached a peak of 9.3% in 1997 and 2002. Since 2002, the rate has been dropping steadily, and in 2007 it declined to8.3%.

4. Labour force and wagesRuth Sehayek - Sigal Zanti

• In 1955, there were 631,000 persons in the civilian labour force, and in 2007 there were 2.9 million (until 1985, the civilian labour force included persons aged 14 and over; since then, it includes persons aged 15 and over). Between 1955 and 2007, the civilian labour force grew at an average annualrate of 3%.

• The participation rate of men in the labour force has dropped steeply – from 80% in the mid-1950s, to 60% in 2003. Since 2003 that percentage rose and reached 62% in 2007. In contrast, the participation rate of women rose steeply– from 27% in the mid-1950s, to 51% in 2007.

• The participation rate in the labour force of the total population (men and women) has remained relatively stable(54% in 1955, 50% in 1987, and 56% in 2007).

• The share of females in the labour force almost doubledbetween 1955 and 2007 – from 25% to 47%.

• The rise in school enrollment among youths has been accompanied by a decline in rates of labour force participation among that population. In 1956, 37% of all teenagers aged14-17 were in the labour force, compared with 9% (aged 15-17) in 2007.

• The labour force includes employed persons (who work at least one hour a week), as well as unemployed persons. Over the years, the share of persons working full time (35 or more hours a week) has decreased – from 78% in 1955 to64% in 2007.

• From 1990 to 2000, the share of employed persons who worked more than 50 hours a week increased – from 18% to 25% (from 26% to 36% for men, and from 5% to 10% forwomen).

• Over the years, two important changes occurred in the composition of employed persons according to industry. First, the share of employed persons in agriculture has decreased – from 10% in 1968, to 2% in 2007. Secondly, the share of employed persons in manufacturing, electricity and water,

0 5 10

15 20 25

1995 2007

Manufacturing

Construction

Trade and repairs

Transport, storage andcommunication

Businessactivities

Publicadministration

Education

Health, welfare and social and personalservices

4b Employed persons, by industry (selected), percentages,1995, 2007

4c Employed persons, by occupation (selected), percentages, 1995, 2007

20071995

1412

1614

75

2017

1825

Academic professionals

Associate professionals and technicians

Managers

Sales and service workers

Skilled workers

4d

19551960

19651970

19751980

19851990

199520

002007

0

2

4

6

8

10

12

Unemployed persons, percentages of labour force, 1955-2007

Manufacturing All industries Public services

1

100.0

120.0

140.0

160.0

180.0

200.0

220.0

1980 1985 1990 1995 2000 2007

4e Average wage index, at constant prices, 1980-2007(basis:1978)

6

compared with 76% to 91% among females).

• The highest rate of unemployment was 11.2% (in 1992), and the lowest was 2.6% (in 1973). In all years, the unemployment rate has been higher among women than among men.

• Out of a total of 2.051 million households in 2007, 75% had at least one employed person (73% in 1998). Of all households with at least one employed person, 44% there was only one employed person, 45% had two employed persons, and 11% had three or more employed persons in 2007.

• 89% of the households with children aged up to 17 in2007, had one or more employed persons (similar to 1998).

• Data on wages are calculated for employee jobs (jobs of employee workers who work at least one day a month and appear on the payroll of the establishment or institution. Jobs appearing on the payrolls of more than one establishment or institution are counted the number of times they appear). Between 1980 and 2007 the number of employee jobs rose from 1.3 million to 2.8 million. During that period, average wages also rose by 53%, at fixed prices (average annual growth rate of 2%). In manufacturing, wages rose by 90% (average annual growth rate of 3%), and in public services – by 58% (average annual growth rate of 2%).

and construction has decreased – from 33% in 1995, to 22% in 2007, whereas the share of employed persons in services has increased – from 56% in 1995, to 76% in 2007.

• With the rising level of education, there has been an increase in the share of persons employed in white-collar professions (academic professionals, associate professionalsand technicians, and managers).

• The share of employees out of all employed persons has grown – from 74% in 1970, to 87% in 2007. Among males, the increase has been more moderate (from 73% to 83%,

Household ownership of cellular phones and stationaryphones, percentages, 1997-20075a

cellular phones stationary phones

7

5. Standard of living Yafit Alfandari - Nurit Dovrin

Standard of Living of Households

• Since the 1950s, there has been a steady rise in the standard of living of households. This process has been characterized by a decline in the share of household expenditures on products, and an increase in the share of expenditures on services. Thus, the share of expenditures on food and on clothing and footwear (products) has declined steadily since the 1950s, whereas the share of expenditures on transportand communications (services) has increased.

• In the 1950s, the largest share of household expenditure was on food (40%). Over the years, the share of expenditure on food has dropped continuously – reaching 20% in the 1990s, and 17% in 2007. The second largest share of household expenditure in the 1950s was on clothing and footwear – 12% of the total expenditure. Expenditures on this item have decreased as well, to as low as 3% in 2007. One of the reasons for the decline in expenditure on clothing and footwear is the drop in the prices on those items as a result of exposure to competition with imported products – a trend that has accompanied the globalization process. Regarding the items on which household expenditure increased, the rise in expenditure on transport and communications was particularly significant (from 5% in the 1950s to 21% in 2007). The changes in household expenditure can be attributed to a rise in the standard of living, and specifically to an increase in rates of car ownership, as well as to the technical and communications revolutions which took place over the lastthree decades.

• The rise in standard of living and in technological advancement have been accompanied by an increase in the variety of luxury items available to households. Some of those items have become an integral part of daily life.

• In the 1950s, only 40% of all households had refrigerators, and the rest used ice boxes. Twenty years later, almost every household had a refrigerator, and iceboxes were no longer

used. In the 1980s, the deep-freezer was introduced in Israel. Ownership of deep freezers grew from 9% in the mid-1980s to 19% by 2007. Dishwashers and microwave ovens were also introduced in Israel during the 1980s, and by 2007 33% and 83% of the households, respectively, owned thoseappliances.

• In the mid-1950s, 82% of the households in Israel owned a radio, and 13% owned a record player. Over the years, other forms of entertainment and media penetrated the market. By 2007, 91% of all Israeli households owned a television, 53% owned a radio, 49% owned a DVD, and 68% subscribed tocable or satellite television.

• Until the 1990s, telephone communication was exclusively through stationary telephone lines. By 1997, nearly everyhousehold owned a phone..

• The cellular phone entered the market in the 1990s, and by 2007 the share of households owning at least one cellular phone reached 89%. Today, for the first time, the percentage of cellular phone owners is higher than that of stationary phone owners (84%). • At the end of the 1950s, 54% of all households lived in owned dwellings, and 45% lived in rented dwellings. The percentage of households living in owned dwellings rose steadily, and reached 71% by the mid-1970s, whereas the percentage of households living in rented dwellings declined sharply to 20% during the same period. Since the mid-1970s, the percentages of households living in owned dwellings has remained almost unchanged, whereas of the percentage ofhouseholds living in rented dwellings rose to 25% by 2007.

• Over the years, housing density in Israel has declined. The number of households with two or more persons per roomhas dropped from 24% in 1975 to 6% in 2007.

• By the end of the 1960s, wages constituted 98% of the households gross monthly income. Over the years, this proportion has dropped – to 83% in 1979/80, 77% in 2001,and 78% in 2007.

• The rise in income and standard of living has been accompanied by increased inequality in the distribution of income among households in the various deciles. The grossincome of households in the upper decile constituted one-

fifth of the total income of households in the economy in the 1950s, compared with one-third in the 2000s.

Distribution of gross income by quintiles, percentages5b

Quintile 5 (upper)

Quintile 4

Quintile 3

Quintile 2

Quintile 1

Gross Domestic Product per capita, 1950-2007, NIS at 2005prices

6a

010,000

20 ,000

30 ,000

40 ,000

50 ,000

60 ,000

70 ,000

80 ,000

90 ,000

100 ,000

19501955

19601965

19701975

19801985

19901995

20002005

2007

Business sector

NIS

Economy, total

8

standard of living of Individuals

• In 2007, 53% of all persons aged 20 and over were satisfied (or very satisfied) with their financial situation; 53% managed to cover their monthly expenditures; 45% expected that theirfinancial situation would improve.

• Of all persons aged 20 and over who worked in 2007, 85% were satisfied with their work and 55% were satisfiedwith their income.

• In the years 2002 through 2007, 50% of the persons aged 20 and over went on holiday or trip in the country (including overnight stays away from home), and 30% went on holiday abroad at least once a year, with almost no changes from year to year.

6. THE ECONOMYTalia Shalem-Cohen - Ronen Elkayam

• Between 1950 and 2007, the Gross Domestic Product (GDP) in Israel increased at an annual average rate of 5%-6% at constant prices, and the GDP per capita increased at an annual average rate of 3%. By 2007, the GDP per capita wassix times higher than in 1950.

• The GDP per capita increased substantially until 1972 (5%- 6% per year). Between 1973 and 1984, the annual growth rate declined to 1%. Between 1985 and 1996, the GDP per capita increased again by an annual average rate of 2%-3%, and in 1997-1999 it decreased again by an annual average of 1%. In 2000, which was a year of rapid economic growth, especially in the high-technology industries, the GDP per capita increased sharply by 6%. However, the growth in 2000 was moderated by the second Intifada during the last quarter of the year. Between 2001 and 2003, the Intifada continued and the GDP per capita declined at an average annual rate of 2%. However, the period between 2004 and 2007 was characterized by a rapid and stable growth – at an annual rate of 3%-4%. The growth during that period can be attributed primarily to intensification of national trade and the relativelycalm security situation.

• In 2007, the Gross Domestic Product per capita was aboutNIS 92,000 ($22,500).

• The expansion of economic activity was accompanied by a transition toward producing high-technology products and services. The share of financial and business services, communications, electricity, and electronics industries in the GDP increased to 35% in 2007. Labour productivity increasedat an average annual rate of 4% in 1960-2007.

• The growth in the GDP was accompanied by an increase in imports of goods and services, which reached an average annual growth rate of 7% in constant prices. Thus, the total amount of available resources in Israel – from domestic production and imports – was 38 times higher in 2007 than in 1950.

0

2007

1 0 ,0 0 0

2 0 ,0 0 0

3 0 ,0 0 0

4 0 ,0 0 0

5 0 ,0 0 0

6 0 ,0 0 0

7 0 ,0 0 0

19501955

19601965

19701975

19801985

19901995

20002005

6b Private consumption expenditure per capita and disposable income per capita, 1950-2007, at 2005 prices

6c Defense expenditure as a percentage of the GDP, 1951-2007 (annual average)

05

1015202530

‘51-’65

‘66-’67

‘68-’72

‘73-’77

‘78-’84

‘85-’89

‘90-’96

‘97-’99 ‘00

‘01-’03 ‘04

-’07

6d Taxes as percentage of the GDP, 1951-2007(annual average)

01020304050

‘51 -’65

‘66 -’67

‘68 -’72

‘73 -’77

‘78 -’84

‘85 -’89

‘90 -’96

‘97 -’99 ‘00

‘01 -’03

‘04 -’07

19501955

19601965

19701975

19801985

19901995

20002005

2007

Total Residential building Industries

6e Gross fixed capital formation, billions of NIS, 1950-2007, at 2005 prices

NIS

Disposable income per capita

Private consumption expenditure per capita

9

• The proportion of resources allocated for general government and private consumption decreased from 70% in the initial years following the establishment of the state to 56% in 2007; and the proportion of resources allocated for capital formation decreased from one-third in the initial years (due to the need to raise new capital stock) to 13% in 2007. In contrast, the share of exports out ofall available resources increased from 3% in 1950 to 30% in 2007. • Private consumption expenditure per capita increased at an average annual rate of 3.4% between 1950 and 2007. By 2007, private consumption expenditure per capita was 6.9times higher than in 1950. • The rise in standard of living was accompanied by a change in the composition of private consumption expenditure. On the one hand, expenditure on basic products decreased: the share of expenditure on food, drinks, and tobacco dropped from 39% in 1950 to 18% in 2007, and the share of expenditure on clothing, footwear, and personal items dropped from 12% to 5% during the same period. On the other hand, expenditure on housing, electricity, fuel, and various services (e.g., education, health, transport, entertainment, sports and domestic help)increased, as did expenditure on travel abroad.

• General government expenditure on civilian consumption – i.e., educational services, health, and welfare – increased at an average annual rate of 5% between 1950 and 2007, and the per capita expenditure on civilian consumption increasedat an average annual rate of 2%.

• There was a general upward trend in defense expenditures during the first 25 years following the establishment of the state, which reached a peak in 1973-1975. In subsequent years, defense expenditures decreased. The average annual increase in defense expenditures per capita between 1950and 2007 was 2.3%.

• The development of public services increased the tax burden. The tax rate reached 37.2% of the GDP in 2007, compared to 20% during the initial years of the state. (The tax rate in 2007 was similar to that of developed countries such as Canada and Germany, but lower than that of Scandinavian countries, which amounts to approximately 50%.) However,transfers and benefits paid to households increased from 2%-3% of the GDP during the initial years of the state to 10%-12% during the last 20 years.

• The government debt increased from 52% of the GDP in the initial years of the state to almost 300% in between 1978 and 1984. The government debt decreased to 130% of the GDP between 1990 and 1998, and to 91.7% between 1999and 2007.

• Gross fixed capital formation – expenditures on machinery and equipment, buildings, various construction works, and transport equipment – increased over the years at an average annual rate of 4.5%. During the initial years following the establishment of the state, there was a considerable investment in residential construction, which constituted 48% of the total gross fixed capital formation. In contrast, 27% of the gross fixed capital formation in recent years has been in residential construction, and 73% of the gross fixed capital formation has been in industries – non-residential construction, infrastructureworks, machinery, equipment, and motor vehicles.

Trade deficitper capita

Exportsper capita

Importsper capita

23728209195023410013419604822472351970

2,0231,36565819803,2422,45778519905,6004,5061,09420007,8146,3911,4232007

7a Trade per capita, millions of US dollars, 1950-2007

7b Imports by economic use, percentages, 1950-2007

0 10 20 30 40 50 60 70 80 90

19501960

19701980

19902000

2007

1 9 5 0

1 9 6 0

1 9 7 0

1 9 8 0

1 9 9 0

2 0 0 0

2 0 0 7

Consumer goods Raw materials Unworked diamonds

Fuels Investment goods

10

7. Foreign tradeHelen Brusilovsky - Bat-Sheva Fishman

• The changes in the volume of foreign trade since the establishment of the State reflect changes in the structure and needs of the economy. From 1950 to 2007 imports of goods (gross) increased from US dollars 300 million to 56,621 million, and exports of goods (gross) increased from US dollars35 million to 54,065 million.

• Along the years there were fluctuations in the prices of exports and imports. Between 1955 and 1972, the prices of exports increased by 22%, and the prices of imports increased by 13%. As a result, the Terms of Trade Index improved by 5.7%. During 1973-1980, the prices of fuels, which constitute a large share of all imports, increased, resulting in theworsening of the Terms of Trade Index by 9%. During 1981-

1999, the Index improved by 25%, mostly as a result of the decrease in the prices of fuels. During this period, the prices of exports increased by 31%, in US dollars, and the prices of imports increased by 15%. During 2000-2007, the prices offuels once again increased, and the Index worsened.

• During 1950-2007, the share of consumer goods out of all imported goods dropped from 26% to 13%, and the share of investment goods decreased from 34% to 14%. The share of raw materials (including unworked diamonds and fuels) increased from 39% in 1950 to a record high of 81% in 1980. In 2007 their share was 73%.

• In the early years of the State, imports from the United States constituted 48% of all imports. Over the years its share decreased, and in 2007 it was 17%. The share of imports from Asian countries increased from 4% in the 1950s to 21% in2007.

• In 1950, the export of agricultural products and worked diamonds made up 75% of the all exports. Over the years, exports of agricultural products decreased, and in recent years it was 2%-3%. On the other hand, the share of industrial exports (excluding diamonds) increased – from 25% in the 1950s to 75% (its highest share) in 2001. In 2007,it reached 74% of all exports.

• In the 1950s, exports to European countries constituted 70% of Israel’s exports (related to the large share of agricultural exports in those years). Following a decreasing trend, the figure reached 36% in 2007, while the share of exports to American and Asian countries increased from 25% to 68%, and from 1% to 18%, respectively. Exports of diamonds to Asian countries was more than 50% of all exports of diamonds in recent years.

8a 8a. National expenditure on civilian R&D as a percentage of theGDP, 1989-2007

8b Share of households with access to a computer, internationalcomparison, 2000, 2007

Consumer goods Raw materials Unworked diamonds

Fuels Investment goods

Korea

Germany

Switzerland

Canada

Great Britain

Finland

IsraelIreland

France

Spain

Italy

Portugal

0 10 20 30 40 50 60 70 80 90

11

8. SCIENCE AND TECHNOLOGY Nava Brenner

• From 1990 to 2007, the national expenditure on civilian research and development (R&D) increased from NIS 11billion to NIS 30 billion, at constant prices.

• The national expenditure on civilian R&D per capita, in terms of the Purchasing Power Parity of the Dollar, increasedfrom $304 in 1990 to $1,220 in 2007.

• Civilian R&D is carried out by four major sectors: the business sector, the government (including local authorities and governmental institutes), higher education institutions, and nonprofit institutions. Financial support for R&D is provided by these sectors, as well as by foreign sources. Between 1990 and 2007, the share of R&D performed by the business sector increased from 53% to 79%, whereas the share performed by the government sector decreased from 11% to 5%, the share performed by higher education institutions decreased from 29% to 12%, and the share performed by nonprofit institutions decreased from 7% to4%.

• The share of R&D performed by the business sector as a percentage of the GDP (3.4% in 2005), and the share of R&D financed by that sector as a percentage of the GDP (3.4%) amounted to almost twice those recorded in the US, and more than three times those recorded in 15 EU countries, onaverage.

• The number of recipients of academic degrees from universities and other institutions of higher education in the fields of science and engineering more than doubled from1995 (5,500) to 2007 (11,000).

• The share of women out of all recipients of academic degrees from universities and other institutions of higher education in the fields of science and engineering, and their

share out of all employees in R&D in the business sector, remained stable between 1995 and 2006 (40% and 23%,respectively).

• Between academic years 1991/2 and 2006/7, university academic staff increased by 18%: senior staff increased by 8%, junior staff increased by 28%, and the other academicstaff (mainly external teachers) increased by 36%.

• The number of full time employees in R&D companies in the business sector increased from 24,000 in 1997 to 41,000 in 2000, decreased to 38,000 in 2002-2004 and increased to41,000 in 2005 and to 43,900 in 2006.

• The share of households with access to a computer grew from 34% in 1997 to 69% in 2007, and the share of those with a subscription to the Internet grew from 5% to 59%,respectively.

• In 2007, the share of Israeli households with access to a computer (69%) was lower than in Japan (85%). In 2000, therates in Israel and Japan were similar (about 50%).

7

1213

15

4 4 42

86

-2-1

19511955

1956-1960

1961-1965

1966-1967

1968-1972

1973-1980

1981-1985

1986-1990

1991-1995

1996-2000

2001-2003

2004-2007

9a Average annual change in the Manufacturing Production Index, percentages, 1951-2007

0100200300400500600700800900

1,0001,1001,2001,3001,400

1960

1965

1970

1975

1980

1985

1990

1995

2000

2005

2007

Manufacturing Production Index

9b Manufacturing Production Index and Labour Input Index1960-2007, at 1960 prices

2 0 0 71 9 5 4

100100

2455

1224

320

911

2430

1315

39..

9c Manufacturing production, according to technologicalintensity, percentages, 1954, 2007

Total

Low Technology

Thereof: Food

Textiles, Apparel, Leather

Other

Medium-Low Technology

Medium-High Technology

High Technology

Labour Input Index

12

9. MANUFACTURINGSimcha Bar-Eliezer - Lior Zisman

• Israeli manufacturing began to develop in the middle of the 20th century. In a census carried out in 1936 by the Jewish Agency, 1,500 factories, employing 28,000 workers, were enumerated. Some of those factories are still active, and at the end of the 1990s they employed 62,000 workers – 18% of allemployees in manufacturing.

• From the establishment of the State in 1948 to the mid- 1960s, many manufacturing establishments were set up. By 1965, there were 25,000 manufacturing establishments in Israel. Of those establishments, about 15% were considered large (employing more than 10 persons). Notably, the data on manufacturing establishments include those that did not employ any workers besides their owners. The rise in the number of manufacturing establishments increased the demand for manpower, so that the number of persons employed in manufacturing increased from 98,000 in 1952 (of whom 56% were employed in large establishments) to 223,000 in 1965, (about 74% of whom were employed in large establishments). In the years that followed, there were fluctuations between periods of expansion and slowdown in manufacturing. In 1966-1967, there was a recession that curtailed the process of expansion in manufacturing; the subsequent period between 1968 and 1972, was characterized by economic prosperity, which was accompanied by increasing rates of export and employment. The Yom Kippur War in 1973 and the First Lebanon War in 1982, led to a prolonged economic slowdown between 1973 and 1985. Afterwards, from 1986 to 1990, the economy began to recover, possibly as a result of the economic stabilization program which was introduced in 1985. Following the massive wave of immigration between 1991 and 1995, mainly from the former Soviet Union, economic growth returned to a high level, which was maintained throughout the entire decade. Between 2001 and 2003, following the outbreak of the Second Intifada (Palestinian uprising) and the collapse of the NASDAQ, the manufacturing production index reached an all-time low. In 2004-2007, the Israeli economy has been recovering and Manufacturing has been growing.

• In 1960-2007, Manufacturing production increased by an annual average of 5.7%, and labor input (actual work hours)increased by an annual average of 2%.

• Manufacturing establishments that operated in the 1950s were mainly warehouses and small establishments that engaged mainly in processing agricultural products and in clothing. At present, Israeli manufacturing is modern, and is based mainly on high technology industries, which employ skilled workers with academic and technical knowledge;about 40% of the manufacturing product is exported.

• Manufacturing industries are divided into four groups, bytechnological intensity:

High technology: electronics; equipment for control and supervision;computers and office machinery; aircraft; pharmaceuticals. Medium-

high technology: refined petroleum; chemicals and chemical products (excluding pharmaceuticals), machinery; equipment andelectric motors; transport equipment (excluding aircraft). Medium-

low technology: mining and quarrying, rubber and plastics, ferrous and other mineral products; jewellery. Low technology: food products; beverages and tobacco products; textiles; apparel; leather products; paper and printing; wood products; furniture. The classification is determined mainly by the share of expenditure on Research and Development out of the total output. It was adopted in recent years, and also applied retrospectively to the initial period ofManufacturing in Israel.

5

38

15

24 2325

46

24

4

2826

20 2022

53

26

1 9 6 5 2 0 0 7 1 9 6 5 2 0 0 7

26

5

14

2125

23

50

35

46

3

29

20 1920

57

7

1 9 6 5 2 0 0 7

Low Technology Medium-High Technology

Medium-Low Technology High Technology

9d Product, output, jobs, and exports, by technological intensity – percentages, 1965, 2007

Exports

ProductOutput

Jobs

1 9 6 5 2 0 0 7

13

• The major change was the decline in the share of low- technology industries (e.g., food, textiles, apparel, and leather products) due to the process of globalization and opening of the Israeli market to competition. In contrast, high-technology industries developed substantially, and accounted for most ofthe growth in Manufacturing since the 1990s.

• The share of medium-high and medium-low technology industries out of the total GDP, output, and jobs remained similar throughout the period from 1965 to 2007. However, in the low and high-technology industries, significant changes occurred during that period. The share of low-technology industries in the GDP and in the total number of jobs decreased from 50% to 28% on the average, and the share of high-technology industries increased from 5% to 30% onthe average.

• In 1950, Israel’s exports totalled $35 million, of which agricultural exports were 49%, and diamonds were 26%. In 2007, Israeli exports totalled $46 billion, of which 3% were agricultural exports, 74% were manufacturing exports, and23% were unworked and polished diamonds.

• Over the years, manufacturing exports of high-technology products increased: in 2007, exports of high-technology industries comprised 46% of all manufacturing exports. In those industries, exports comprised 74% of the output.

10. AGRICULTURE

Dr. Moshe Yanai, Yaniv Sharabi

field crops

citrus fruit

vegetables

10a Area of field crops, citrus fruit and vegetables, thousands of dunams, 1949-2006

10. AGRICULTUREDr. Moshe Yanai - Yaniv Sharabi

• During the first decade of Israel’s existence, the total agricultural area increased by about 140%, and reached 3,940 thousand dunams by 1957. Until the beginning of the 21st century, there were no significant changes in the country’s agricultural area. Between 2003 and 2006, the agricultural area diminished (the data for 2003 and onwards cannot be compared with previous data due to changes in thedata collection method).

• From the early 1950s to the end of the 1980s, the area used for growing field crops was 60% of the total agriculturalarea. Since 1990, its share has decreased to about 50%.

• The citrus fruit industry has existed in Israel for over 150 years. From 1949 to 1966, the area of citrus plantations grew from 125,000 to 416,000 dunams, and during the two decades that followed there was no change. During those four decades, the main citrus crops were white grapefruits and Shamouti oranges, intended for export to the European market. Following increased competition and reduced profits, the area of citrus growing diminished to 163,000 dunams in 2006. Recently, there has been a recovery in the industry, and an increase in the amount of citrus fruits planted, mainly tangerines and grapefruit.

• The vegetable crop area increased sharply during the first four years after the establishment of the State – from 70,000 to 300,000 dunams. Between 1954 and 1988, the vegetable crop area ranged from 300,000 to 400,000 dunams, and between 1989 and 2006 it grew by about 65%, to 720,000 dunams.

• During the 1960s and 1970s, the quantities of agricultural output, as well as the input and net product of agriculture increased at moderate and similar rates. Since 1980, the amount of output has increased at a much higher rate than that of input. As a result, the net domestic agricultural product

2006-1949

0

250

500

750

1,000

1,250

1,500

1,750

2,000

2,250

2,500

2,750

3,000

1949 1950

1960

1970

1980

1990

2000

2006

ירקות רי יוי

Net domestic product Input Output

10b Output, input and net domestic product, quantity indices,1960-2007, at 1967/68 prices

Potatoes Vegetables Citrus fruit Flowers

10c Agricultural exports, thousands of tons, 1949-2007

Year

Fish (thousandtons)

Eggs (millions) Cow’s milk(million litres)

Cattle for meat (thousandtons)

Poultry for meat (thousandtons)

1950 6.6 330.0 92.2 1.9 7.4

1960 13.9 1,114.0 277.3 25.1 45.7

1970 21.8 1,320.0 440.5 35.6 101.7

1980 24.7 1,614.9 670.3 55.0 200.0

1990 26.2 1,739.3 923.9 67.8 261.7

2000 37.7 1,704.2 1,149.3 86.5 412.4

2007* 44.2 2,013.4 1,185.0 105.2 524.0

10d Animal products, 1950-2007

10h

(Israeli employees) (Foreign workers (including from Judea and Samaria and the Gaza Area)

(Self-employed Persons and Kibbutz members)

Employment in agriculture thousands, 1960-2007

*Provisional data

80

70

60

50

40

30

20

10

0

10009008007006005004003002001000

14

rose sharply, and doubled between 1990 and 2007. These indices reflect the trend of growing efficiency in agriculture which can be attributed, among other reasons, to a reduction in the quantities of input required for the production of the agricultural output. For instance, water consumption in agriculture did not rise from the1970s to the 1990s (approx. 1,240 million cubic meters), and since then it has evendecreased (to 1,108 million cubic meters in 2006).

• Up to 2000, citrus fruits were the main agricultural export product. Between 1949 and 1979, the quantity of exported citrus fruits increased by 500% – from 155,000 tons to 965,000 tons. Since 1980, there has been a decline in the amount of citrus fruits exported, and in 2007 it was 178,000tons. • Until 1995, only a small quantity of potatoes was exported. Since then, there has been more than a ten-fold increase, andin 2007 potato exports reached a peak of about 330,000 tons. • The quantity of exported vegetables reached a peak of249,000 tons in 2007. • Exports of flowers began in the 1950s on a small scale; since the end of the 1970s there has been an increase, and in1998 flower exports reached a peak of 224,000 tons.

• Production of livestock and livestock products increased substantially during the first decade after the establishment of the State: there was a six-fold increase in breeding of poultry for meat, and a thirteen-fold increase in breeding of cattle for meat; production of cattle milk and eggs tripled.

Since then, the increase in livestock and livestock products has continued, albeit at a more moderate rate – the average increase in production of the various products was 15%-70%per decade.

• In 1960, self-employed persons and members of kibbutzim constituted 60% and salaried employees constituted 40% of all persons employed in agriculture. During the 1960s, foreign workers entered agriculture, at first from Judea and Samaria and the Gaza Area, and later from foreign countries. Over the years, the number of self-employed persons and kibbutz members working in agriculture decreased by 75%. The number of salaried employees decreased by 60% between 1960 and 1980, and increased by 45% since 1980. In 2007, foreign workers constituted 39% of all employed persons inagriculture.

• The supply of calories and nutrients per capita per day increased between 1950 and 2006 – from 2,610 to 3,643 kilocalories (an average increase of 7% per decade). The most substantial increase, of 15%, was recorded during the 1990s – from 3,089 kilocalories in 1990, to 3,556 kilocaloriesin 2000.

Civil engineering works Non-residential construction Residential construction

11a Gross fixed capital formation in construction, NIS billion, 1967-2007, at 2005 prices

11b Dwellings on which construction was completed, by district, thousands, 1960-2007

0

1 5

3 0

4 5

6 0

7 5

Jerusalem D. Judea and Samaria Area Haifa D. Northern D. Tel Aviv D. Southern D. Central D.

70

60

50

40

30

20

10

0

1967

1970

1975

1980

1985

1990

1995

2000

2005

2007

15

11. CONSTRUCTION Gershon Kun

• Construction, unlike most industries, is characterized by sharp fluctuations in the scope of its activity. On the one hand construction is sensitive to changes in the overall economic activities; on the other hand, fluctuations in construction usually generate fluctuations in the overall economy. Increased activity in construction was recorded during the first major wave of immigration in 1949-1951, during the period of intensified growth in the Israeli economy between 1954 and 1965, during the period of economic growth between the Six Day War and the Yom Kippur War (1968-1972), and in the mid 1990s, when a large wave of immigrants arrived in Israel from the former Soviet Union. Of the residential construction allocated for immigrant absorption, public construction wasdominant.

• Gross fixed capital formation in construction, at constant prices, increased between 1967 and 2007 at an average annual rate of 4.2%, and was 4 times higher in 2007 than in1967.

• The share of gross fixed capital formation in construction out of the GDP dropped from 13.4% in 1996 to 8.4% in 2007, a rate even lower than that recorded before the mass wave of immigrants from the former Soviet Union (8.7% in1989).

• Gross fixed capital formation in dwellings, the main component of gross fixed capital formation in construction, reached a peak in 1995-1998 – the annual average was NIS 36.8 billion (at 2005 prices). By comparison, in 2003-2007 NIS 27.0 billion (at 2005 prices) were invested – 27% lessthan in 1995-1998.

• Construction area completed (for all purposes) increasedfrom an annual average of 3.2 million square meters in 1949-

1969 to 5.3 million in 1970-1990, and reached a high of 9.3 million in 1991-1999. In 2000-2007, the annual average areaof construction completed was 8.1 million square meters.

• From 1949-1969 to 1991-1999, the area of residential construction completed almost tripled – from an annual average of 2.3 million square meters to 6.7 million square meters. In 2007, 5.1 million square meters of residential construction were completed – about 70% of the totalconstruction area completed that year.

• The construction area completed of public buildings increased from an annual average of 320,000 square metersin 1949-1969, to 651,700 square meters in 2000-2007.

• Between 1955 and 2007, construction of approximately two million new dwellings was completed. The largest number of new dwellings completed was in 1992 – 70,100, and thesmallest number was in 1988 – 19,600.

• Of all dwellings on which construction was completed, the share of swellings in the Tel Aviv District decreased steadily, from 32% in 1960-1969 to 10% in 2000-2007, whereas the share of dwellings in the Central District increased steadily,from 18% to 30%, respectively.

• The share of dwellings on which construction was completed in the Northern District was highest in the 1980s,and in the Southern District – in the 1990s.

• 62% of the dwellings completed in 1962-2007 were in private construction, and the rest were in public construction (i.e., by the Ministry of Construction and Housing, national

New roads Reconstructed roads

11d Completion of construction and reconstruction of roads, lengthin km., 1961-2007

20072005

20001995

19901985

19801975

19701965

1962

Immigrants Public construction Private construction

11c Construction completed on dwellings, thousands, 1962-2007

20071970

2,284266Vehicles (thousands)

3,281439Drivers (thousands)

45.05.9Kilometers traveled (billions of kilometers)

17.99.3Length of paved roads (thousands of kilometers)

144.654.7Area of paved roads (thousands of square kilometers)

12a Transport, 1970, 2007

12b Transport, percentages of change, 1970-2007 (base year 1970)

Length of roads Area of roads Km. traveled

Vehicles Drivers

2007

1962

1965

1970

1975

1980

1985

1990

1995

2000

2005

2007

250

200

150

100

50

0

16

institutions, and local authorities). Dwellings built in public construction are usually located in peripheral areas and in Jerusalem, and they are relatively small, whereas dwellings built in private construction are larger and located in the central region of the country. Since 1995, there has been a sharp decline in the extent of public construction, and a moremoderate decline in the extent of private construction.

• 39% of the dwellings on which construction was completed in 2007 were in buildings with 1-2 dwellings, compared to35% in 2000.

• Small dwellings (1-3 rooms) constituted 92% of alldwellings on which construction was completed in 1955- 1969. In subsequent years, large dwellings were built, so that the share of small dwellings out of all dwellings constructed decreased, and amounted to 17% in 2000-2007; 51% of the dwellings on which construction was completed in 2007 hadfive rooms or more.

• In 1961-2007, construction of 20,000 kilometers of new and reconstructed roads was completed, and 40,000 kilometers of water, drainage and canalization pipes were installed.

12. TRANSPORTHila Yavlovich - Tehila Klien

• The development of the transport infrastructure stimulates the development of a country’s economy. The length of roads in Israel in the early 1970s was 9,300 kilometers, and their total area was 54,700 square kilometers. Over the years, roads were lengthened and widened, and new roads were constructed. By 2007, the length of the roads in Israel was 17,900 kilometers, and their total area was 144,600 square kilometers. The most extensive addition was during the 1990s, when 3,300 kilometers were added to the length of the roads, and 33,000 square kilometers were added to their area.

• As the number of vehicles increased more than the lengthand area of the roads, road density also increased.

• In 2007, approximately NIS 8 billion were invested in transport infrastructure, more than half of it was invested in roads. In 1995, NIS 5 billion were invested, of which 80% wasinvested in roads (at 2005 prices).

• The average number of kilometers traveled per year by aprivate car decreased from 19,300 in 1970 to 16,500 in 2007.

• Despite the increase in the number of vehicles per 1,000 residents – from 22 in 1950 to 315 in 2007 – the rate in Israel is lower than in many Western countries (i.e., about 500 in theNetherlands, and about 800 in the US).

• The number of road accidents with casualties increased, with fluctuations, and reached an annual average of approximately 25,000 in 1996-1998. Afterwards, the number decreased, and in 2003-2007 the annual average wasapproximately 17,000.

12c Persons killed in road accidents 1950-2007

12d Railway passengers, millions, 1950-2007

0

1,000

2,000

3,000

4,000

5,000

1059 1

069 1079 1

089 1099 2

0007002

Departures abroad Tourist arrivals

13a Tourist arrivals to Israel and departures abroad of Israelis, thousands, 1950-2007

Average annual increase, %Annual average

13.547,0001950s14.1269,0001960s10.3772,0001970s1.31.3 million1980s7.32.0 million1990s-2.21.7 million2000-2007

13b Tourist Arrivals35

30

25

20

15

10

5

0

1950 1960 1970 1980 1990 2000 2007

17

• The annual number of people killed in road accidents increased since the establishment of the state, and reached 716 in 1974. In 1975-1986, the number decreased to 387. Since then, there have been fluctuations; in 2007 the number ofpeople killed in road accidents was 398 – the lowest since 1985.

• The share of public buses operating on scheduled routes out of the total number of buses has decreased, from 90% inthe early 1960s to 44% in 2007.

• The annual average number of train passengers between 1950 and 1989 was 3.6 million. During the 1990s and in the 21st century, programs were formulated for the development of the Israel Railways, and its budget increased. The train has become an advanced, popular mode of transportation. The number of railway passengers was12 million in 2000, and in 2007 a peak number of 32 million was reached. Between 1990 and 2007, the number of railway passengers increasedby an annual average of 16%.

• About 2,300 aircraft landed in Israel in 1950, and about 117,000 passengers entered and departed from Israel in those aircraft. The number of aircraft landings at airports in Israel increased gradually over the years: in 2000 about 33,000 aircraft landed in Israel, and the number of passengers was 9.6 million. In 2001-2003, following the Intifada (Palestinian Uprising) that broke out at the end of 2000, the number of aircraft landings decreased sharply. Recovery began in 2004, and in 2007 there were 34,500 aircraft landings and 10.2million passengers.

13. TOURISMOsnat Levy – Taly Rosenfeld

Tourist Arrivals

• Since the establishment of the state, there were 57 million tourist arrivals in Israel, of which 80% occurred since the 1980s. The number of tourist arrivals increased from an annual average of 47,000 in the 1950s, to 2.7 million in 2000 (the year the Pope visited Israel). Along with the general upward trend, tourism to Israel has been characterized by fluctuations. Tourism declined substantially following security events in Israel, in the Middle East, and throughout the world.Afterwards, tourism recovered.

• Following the Second Intifada, which broke out at the end of 2000, and with the intensification of terror attacks in 2001, there was an ebb in tourism to Israel (0.9 million in 2002). Since then, there has been a steady recovery, and in 2007 thenumber of tourist arrivals reached 2.3 million.

• The 1950s: Following the Sinai Campaign (1956), the number of tourist arrivals to Israel declined by 15%. In 1958, the 10th Independence Day, the number of tourist arrivalsincreased by 60%.

• The 1960s: Until 1966, the number of tourist arrivals increased at an average annual rate of 19%. In 1967, the year of the Six Day War, the number of tourist arrivals declined. After the war, the number of tourist arrivals increased bynearly 50%, in 1968.

Average annual increase, %Annual average

7.838,0001950s

9.3101,0001960s

12.8288,0001970s

6.1714,0001980s

14.22.0 million1990s

2.33.6 million2000-2007

13c Departures abroad of Israelis

18

• The 1970s: The Yom Kippur War (1973) led to a decline in the number of tourist arrivals, which continued for three consecutive years. Afterwards, the number of tourist arrivals increased at an average annual rate of 16% per year (in 1978, the peace agreement with Egypt was signed), reaching overone million for the first time.

• The 1980s: During that decade, there were numerous fluctuations in tourism. A decline in the number of tourist arrivals began in 1982, after the First Lebanon War. In addition, tourism was affected by terror attacks and by theFirst Intifada.

• The 1990s: As a result of the First Gulf War (1990-1991), there was a cumulative decline of 24% in the number of tourist arrivals. After the war, there was a substantial recovery (especially following the peace agreement with Jordan in 1994). That agreement provided an opportunity for tourists to combine visits to Israel with visits to neighboring countries. In 1994, the number of tourist arrivals reached two million forthe first time.

• 2000-2007: In 2000, the number of tourist arrivals reached a peak of 2.7 million. The Second Intifada and world terrorism led to a sharp drop in the number of tourist arrivals, to less than one million in 2002). Since 2003, there has been a gradual recovery in tourism (despite a slowdown as a result of the Second Lebanon War). In 2007, the number of touristarrivals reached 2.3 million.

• The average length of stay for tourists staying in Israel up to one month (90% of all tourists) declined from 13 days in the1950s to 8 days in 2007.

• During crisis periods, the share of Jews out of all tourists arriving in Israel was relatively high, because they were the ones who continued coming to the country regardless of the security situation. In 2001-2003, arrivals of Jewish tourists constituted approximately one-half of all tourist arrivals in Israel, compared with one-fourth during the peak years of tourism (1999-2000). Therefore, the share of tourists from France (most of whom are Jews) grew from an annual average of 10% in the 1980s and 1990s to 16% in 2001-2003. In contrast, the share of tourists from Germany (most of whom are non-Jews) declined from 10% to 5% during the sameperiod.

Departures Abroad of Israelis

• During the 60 years of Israel’s existence, there were 60 million departures abroad of Israelis. Since the establishment of the state, that number has risen steadily – from an annual average of about 38,000 in the 1950s to a peak of 4.2 million in 2007. The number of departures per 1,000 residentsincreased from 22 to 578, respectively.

• The 1950s: During the 1950s, the number of departures abroad of Israelis continued to increase, almost throughout the entire decade.

• The 1960s, 1970s, and 1980s: During that period, the upward trend in departures abroad of Israelis continued, except for a decline of 24% in 1985 due to the reinstatementof travel tax.

• The 1990s: There was a sharp rise in the number of departures abroad of Israelis. Among other reasons, that increase can be attributed to: rapid growth in the population following the massive influx of immigrants from the Former USSR; cancellation of the travel tax in 1992; the peace agreement with Jordan in 1994, cancellation of restrictions on foreign currency in 1998; the decline in air fare; and the large supply of inexpensive vacation packages to Turkey, Greece,and Cyprus.

• 2000-2007: In 2002, the number of departures abroad of Israelis declined by 8% as a result of the economic recession. In 2004, when the economy began to recover, the number of departures increased by 10%. The increase in departures was more moderate in 2005 and 2007, due to the implementation of the disengagement plan from Gaza, and to the Second Lebanon War. In 2007, despite the crisis situation, the numberof departures abroad of Israelis reached a peak of 4.2 million.

• The number of departures by land to Jordan and Egypt is affected by the security events in Israel and the region. The peace agreement with Jordan (1994) and opening of the “Arava” and “Jordan River” checkpoints led to a rapid increase in the number of departures by land (a rise of 83% in 1994), whereas terror attacks in Egypt and Israel led to a sharpdecline in departures by land (32% in 2001).

• The average length of stay abroad of Israelis departing by air for up to three months declined from 36 days in 1975 to11 days in 2007.

• From 1993 to 2007, the median age of Israelis departingabroad remained stable (40 years).

Total Tourist person-nights Israeli person-nights

0

5

10

15

20

25

1961 1966 1971 1976 1981 1986 1991 1996 2001 2007

14a Person-nights in tourist hotels, millions, 1981-2007

19

14. ACCOMMODATION SERVICESTilda Khait

• The increase in incoming tourism to Israel and in domestic tourism generated a growing demand for hotels and accommodation rooms. As a result, the number of tourist hotels (registered as such by the Ministry of Tourism) increased from 190 in the early 1960s to 331 in 2007, and the number of rooms in those hotels increased from about 7,000 to 47,000, respectively. In addition, in 2007 there were13,000 rooms in rural tourism accommodations, hostels, etc.

• The average number of rooms per hotel increased from 34in the early 1960s to 142 in 2007.

• In the 1980s, rural tourism began to develop rapidly. By the end of 2007, there were 100 rural tourism establishments in kibbutzim and collective moshavim with close to 3,500 rooms, and approximately 1,200 more private establishmentswith over 4,000 rooms.

• The number of tourist person-nights in hotels is on the rise, despite fluctuations characterized by sharp declines at times of crisis followed by periods of recovery. The most serious crises included the First Lebanon War in 1982, the First Gulf War in 1990-1991, and the Second Intifada between 2000 and 2003. The number of person-nights of Israelis has increased almost continuously, and stabilized at an average number of about 12 million person-nights annually over thepast few years.

• In 1961, Jerusalem and Tel Aviv-Yafo had the largest number of accommodation rooms in hotels (7,100 and 4,900, respectively). In 2007, these were Elat and Jerusalem (10,800and 9,100, respectively).

• The number of employed persons in hotels rose steadily until 2000. In 2001 and 2002, the number dropped sharply, and since 2003 there has been a steady rise again. In 2007, there were over 30,000 employed persons in hotels, includedpersons hired by temporary employment agencies.

THE CENTRAL BUREAU OF STATISTICS

Jerusalem (main office)

66 Kanfe Nesharim St., Corner Bachi St.

P.O.B. 34525, Zip Code 91342

Information Center in Jerusalem

Phone: 02-6592666

Fax: 02-6521340

Library: located in Jerusalem and open to the public Sundays-Thursdays from 9:00 to 14:00

Tel Aviv-Yafo

86 Menachem Begin Rd.

P.O.B. 57207, Zip Code 61571

Information Center in Tel Aviv-Yafo

Phone: 03-5681933

Fax: 03-5681946

CBS publications are also available at the Tel Aviv-YafoInformation Center

Cover photograph

On right: The National Photograph Collection

On left: Courtesy ISCAR Ltd

May 2009