The price of chaos: The massive economic damage caused by the shutdown of Ben Gurion Airport

The strike that led today (Thursday) to widespread disruptions at Ben Gurion Airport caused damage to the economy estimated at this stage at 25 to 30 million shekels. This is a preliminary estimate that includes the direct and indirect costs of the shutdown of operations.

The damage is reflected in the loss of passengers' time, direct and operational costs for airlines, and loss of revenue for the Israel Airports Authority and the various operators at the airport. Added to this are the disruptions in cargo and courier systems, the damage to the supply chain, and the losses to the tourism and hotel industries.

Beyond the immediate damage, the event exposed three structural problems in the Israeli aviation infrastructure: limited capacity, dependence on a single operator, and the great power of the workers' committee, which harms the ability to create operational flexibility, streamline operations, and promote the development of additional airports.

Ben Gurion Airport is at maximum capacity

Ben Gurion Airport is currently operating at its maximum daily capacity. This means that any malfunction, strike, or unusual load can quickly cause widespread disruptions, without an alternative airport capable of absorbing a significant portion of the activity.

Complementary airports are supposed to increase capacity and provide a solution in cases of shutdown or malfunction, but development plans are delayed. Every additional day that the approval and construction of the airports do not progress increases the pressure on Ben Gurion Airport and deepens Israel's total dependence on it.

The absolute switch of the workers' committee

The Israel Airports Authority is a monopoly that holds the national aviation infrastructure in its hands. The strong workers' committee concentrates great power through its control of operational roles, and thus effectively holds the "switch" that allows for the shutdown of the entry and exit gates of the State of Israel.

The absence of competing operators turns any local conflict into an event with national impact. Creating competition between several airport operators will reduce the possibility of shutting down all aviation activity due to business, organizational, or other considerations.

60% of expenses are directed to salaries

Another problem concerns employment costs at the Israel Airports Authority. Salaries at the Authority are significantly higher than the average salary in the economy, and salary costs reach about 60% of the organization's total expenses.

The high current expenses limit the budget available for infrastructure development and are a burden on efficiency and the level of service. The extensive use of the Authority's employees instead of franchisees and other operators also makes it difficult to create employment flexibility and to reinforce systems during peak days.

The steps that will prevent the next crisis

The required response begins with the approval of the plans for the establishment of the complementary airports in Ramat David and Tzaklag, alongside the development of Ben Gurion Airport's capacity to the maximum possible. At the same time, the establishment of airports by private entities and the legislation required for this must be promoted.

The complementary step is the formulation of a comprehensive efficiency plan at the Israel Airports Authority and a change in its role even in existing airports — from a body that performs a significant part of the operational activities itself to a management body. Expanding competition and operational flexibility may reduce the risk that another crisis will once again shut down the country's gates.