‘State does not invest enough in education’

Experts say lack of effort to integrate haredim, Arabs raises fears for country’s economy

Chaim Rachmani spends his days studying Jewish religious texts in Bnei Brak, whose crowded streets brush up against the office towers of Tel Aviv. He has no plans to look for work – ever.

While dressed in a pinstriped business suit, Rachmani is among half of all haredi (ultra-Orthodox) men with no job. This trend in a rapidly growing community – along with employment problems among the Arab minority – is raising concerns about the long-term health of an economy now in the midst of a boom.

“My intention is to study for the rest of my life. I do it because I love it,” said 25-year-old Rachmani. “When you are taught from a young age to learn, you like it and don’t want to stop.”

He feels no need to venture beyond the walls of his yeshiva to seek paid work. Rachmani’s new bride supports him with her entry-level computer job at Intel, while he receives a stipend of about NIS 1,700 from the state and donations for learning Talmud.

While Rachmani was born in Miami, he graduated from Maoz Hatorah, a school in Bnei Brak for boys aged three to 15. It teaches some reading and writing in Hebrew and basic arithmetic, but most of the day is devoted to religious studies.

Therein lies a major problem for economic planners. Thanks to their large families, haredim are forecast to become a third of the population by 2065, up 11% from now. While female employment levels are in line with the rest of society, many of the men lack the skills needed to power a modern, first-world economy – if they want to work at all.

The hi-tech sector, which employs 9% of workers, is booming. Venture capital investment as a percentage of gross domestic product is the highest in the world, and growth is among the strongest of the developed economies.

But the overall figures mask divisions that, while also affecting less religiously observant and secular people, RABBI ASSAF AVITAN, founder of the all-boys haredi school Moaz Hatorah in Bnei Brak, speaks to children in a classroom on July 12. Right: A woman prepares food in her kitchen in the Beduin village of el-Atrash on July 17. particularly touch the haredi and Arab communities.

Poverty rates are higher than in all other developed countries, and income inequality is second only to the US within the OECD, a club for wealthier nations. Just 20% of the population pays 90% of income tax.

Bank of Israel Gov. Karnit Flug is worried.

“This is an impossible situation. If we want to become a cohesive society, without unacceptable social gaps in levels, we will need to change the situation of a dual economy, which exists today, to that of a single economy,” she said.

“The path to get there passes through inclusive growth,” she told a recent conference, referring to getting all social groups engaged in the workplace.

Economists say the country must change its priorities by investing in infrastructure, strengthening the education system and integrating the ultra-Orthodox and the Arab population – who make up 21% of citizens – into the workforce.

Failure could eventually threaten the very existence of the country, according to experts, who say creating wealth is vital for funding strong armed forces in a country that has fought several wars with its Arab neighbors since 1948.

“Already today, half of the nation’s children receive a third-world education and these are children belonging to Israel’s fastest-growing population groups,” said Tel Aviv University economist Dan Ben-David, founder of the Shoresh Institution for Socioeconomic Research.

“Children who receive third-world educations will only be capable of sustaining a third-world economy. But a third-world economy will not be able to maintain the first-world army that Israel needs in order to survive.”

In the 1980s, 63% of haredi men worked but as the community grew, it decided to rebuild the world of yeshivas that was destroyed in Europe in the Holocaust. The policy of paying yeshiva students a stipend solidified this trend, taking the level down to 51% now.

According to the Haredi Institute for Public Affairs, the government won’t achieve its 2020 target of getting the proportion of working men back to 63%.

The community is content with the status quo.

“We need a few generations of this,” said Rabbi Assaf Avitan, founder and principal of the school that Rachmani attended in Bnei Brak. “In the future there may be more of a balance.”

In the meantime Avitan, who studied until he was 35, believes his pupils are well prepared to work should they so choose. “If you learn Torah you can get by in everything,” he said.

The government sponsors special segregated courses to prepare religious men for continuing their secular education. It also offers courses to haredi women – many of whom have low-paying teaching jobs– to enable them to work in computers, graphics and occupational therapy.

In the sizable US haredi community, a quarter of adults get a university degree, compared with just 12.1% in Israel, Ben-David says.

While nearly 22% of the Israeli population is under the poverty line, that figure is 52% for the ultra-Orthodox, although their expenses are modest for a community where wives are the main family breadwinners.

“It’s not the government’s business who is a family’s primary provider and who is secondary,” said Eli Paley, founder of the Haredi Institute and owner of haredi media group Mishpacha, which employs mainly women.

Nearly three-quarters of haredi women work, identical to the general population, but their average monthly salary of NIS 6,170 is below the NIS 9,309 average of other Jewish women. Many work only part time.

Such data is hardly front and center when politicians tout economic statistics that have been among the best in the West.

Boosted by hi-tech, Israel’s economy grew 4% in 2016 and is forecast to grow 3.5% this year. Unemployment is at a historic low of 4.5%, yet 70% of workers earn less than an average salary of NIS 10,000 a month.

Israeli Arabs, like haredim, have low pay and high jobless rates, though for different reasons.

“If you want the Arabs to be integrated in the economy, we need more spending,” said Johnny Gal, a researcher at the Taub Center for Social Policy Studies.

According to the Bank of Israel, 60% of Arab men work, many in construction, earning half of what Jewish men make. Just 25% of Arab women work, while 55% of Israeli Arabs live below the poverty line.

The problem is particularly acute among the 260,000 Beduin scattered throughout the Negev, who have had difficulties giving up generations of nomadic living.

Salma el-Atrash, a father of 10, said many of his village’s 150 children do not attend high school because the nearest is too far away.

“The most impoverished villages in Israel are the Beduin villages,” he said. “The root of the problem is first and foremost education... the state does not invest enough in education.”

Talal al-Krenawi, mayor of Rahat, said if the government wants his people to contribute to economic growth it needs to invest in planning the villages and integrating the population in the workforce.

Finance Ministry chief economist Yoel Naveh said state spending on Arab education has increased over the past decade. It has been easier to engage the Arabs than the haredi community, which is a more closed society, and changes to education require political will, he said.

There are also broader problems in the education system. The average number of years of schooling is high compared with other countries but the quality is low, experts say, and teachers’ pay needs to be raised to attract more skilled people.

Israel built seven top-notch research universities in its first few decades, but none since the 1970s, though the population has more than doubled. Instead, non-research colleges have become the preferred policy direction, Ben-David said.

Labor productivity is now below that of most OECD countries and the disparity between what an employed person can attain in Israel and other countries is widening.

If this is not corrected, Israel could suffer an exodus of educated people “to reach a magnitude that may become irreversible”, Ben-David warned.

“I don’t think we will crash and burn. I think we will fix it,” he said. “But we are running out of time.”

(Reuters)