Due to summer teacher layoffs: unemployment rose to 3.3% in July
Israel's unemployment rate rose to 3.3% in July, with the broad rate reaching 4.4%. The increase is largely attributed to seasonal layoffs of education personnel during the summer break.
An increase of about half a percent was recorded in unemployment in the month of July. The broad unemployment rate rose from 4% in June to 4.4% in July, and the classic unemployment rate from 2.8% to 3.3%. However, this is largely a seasonal increase resulting, among other things, from the problematic phenomenon of summer layoffs of education and non-formal education personnel without tenure.
Seasonally adjusted, the classic unemployment rate rose slightly from 2.9% to 3.1%. This is according to the labor force survey data for July published today by the Central Bureau of Statistics. In absolute terms, the number of classic unemployed rose from 128,000 in June to 148,200 in July. Despite the fluctuation, this is still an exceptionally low figure for a labor market with frictional unemployment. As mentioned, a large part of the increase can be attributed to those laid off for the summer who will return to work by October.
The broad unemployment percentage soared from 4.0% (180,000 people) in June to 4.4% (199,600 people) in July. The employment rate (excluding people on unpaid leave) rose from 60.1% in June to 60.3% in July. At the peak of the war in March, it fell to 51.9%. One can see this as a return to the "war routine," between 60% and 61%, but not to the levels of 61% that existed before it. It should be emphasized that the employment rate, and not the unemployment rate, is the figure that reflects the level of activity in the economy. Its difficulty in returning to routine expresses the high reserve mobilization and also the crisis in the tourism industry.
Meanwhile, an increase of 9.9% was recorded in the number of employees in non-profits since 2022 — double the increase in the number of employees in the economy. It is possible that this stems from the increased needs in the fields of welfare and health. The non-profits' income from donations grew during this period from 16.3% of all their income to 17.3%.
An increase of 4.9% was recorded in 2025 in the gross product of non-profits — from 100.8 billion shekels in 2024 to 105.7 billion shekels in 2025. This is an increase of 22.2% from 86.5 billion shekels before the war. However, the share of non-profits in the GDP remained the same as in 2022 — 5% — and is not returning to the level of 5.4% that was consistently present until 2020. The number of employees in non-profits grew from 624,000 in 2024 to 642,000 in 2025, and their share of total employment in the economy grew from 14.8% to 15.5%. Non-profit income rose by 6% to 265 billion shekels in 2025.
