18% of workforce absent due to Gaza conflict; Knesset approves business compensation outline

NOVEMBER 2, 2023 10:00

Updated: NOVEMBER 2, 2023 11:45

Building workers pouring concrete on the first floor of a new gas station in the Industrial zone of the northern town of Katsrin, Golan Heights on September 9, 2023. (photo credit: MICHAEL GILADI/FLASH90) — Building workers pouring concrete on the first floor of a new gas station in the Industrial zone of the northern town of Katsrin, Golan Heights on September 9, 2023.

(photo credit: MICHAEL GILADI/FLASH90)

An additional 46,000 workers have been fired or put on unpaid leave as a result of the ongoing war.

A report published on Thursday by the Labor Ministry has revealed that, as of the beginning of the ongoing conflict with Gaza, approximately 760,000 people have been forced to step away from their jobs due to military service, residing in the Gaza periphery, or caring for children, making up approximately 18% of the workforce.

Additionally, over 46,000 employees (making up approximately 1% of the workforce) have been either terminated or placed on unpaid leave, with 70% of them falling into the latter category.

In response to this significant workforce gap, Labor Minister Yoav Ben-Tzur announced that, among other measures, the ministry has “approved the recruitment of 5,000 foreign workers from various countries worldwide to address the Israeli agriculture crisis and assist the sector in continuing to function.”

Clearly needed businesses support

Late Wednesday night, the Knesset approved the outline Finance Ministry's plan to provide compensation for businesses affected by the indirect damage resulting from the conflict, which will now move to a vote for approval in the coming days.

This plan provides financial relief based on the level of impact and business revenue. It covers a wide range of businesses, from those with annual revenues of 18,000 NIS to 400 million NIS.

Minister Yoav Ben-Tzur at a replacing ceremony in the Ministry of Social Affairs, Jerusalem on January 1, 2023. (credit: YONATAN SINDEL/FLASH90)

Eligibility for compensation is determined by the extent of revenue reduction, with specific criteria for new businesses that started operations after September 2, 2022. The compensation structure varies, with fixed amounts for some businesses and a more complex calculation for others, including additional reimbursement for salary expenses.

The Tax Authority will allow businesses to file online claims within 90 days from the system's launch date. To be eligible, businesses must submit VAT reports for September and October 2023 and maintain proper accounting records.

Additionally, the plan includes various easements to support businesses. These measures will be in effect from October 7 to November 30 and include removing conditions for vacation day deductions, extending unemployment benefits, and reducing waiting periods.