Is there a solution to Israel’s foreign worker crisis? "My Outline" launched

Dawn of a new day? After seven months of severe labor shortages across various sectors, especially the construction industry, which has faced a deficit of approximately 90,000 Palestinian workers from Judea and Samaria since October 7, the government announced on Wednesday that it will approve "My Outline" for a comprehensive approach to the employment of foreign workers in Israel. The outline was developed under the initiative and leadership of Prime Minister Benjamin Netanyahu.

The government's goal is to mitigate worker shortages in various industries and stabilize the economy amid the current security situation. This involves strengthening the supervision and enforcement of foreign worker employment, reducing prohibited brokerage fees, and ensuring the preservation of foreign workers' rights in Israel.

According to government estimates, the decision will remove barriers and revise existing regulations to enable uniform treatment of all foreign workers and facilitate quick, orderly decision-making based on the proposed professional infrastructure.

What does the outline include?

• The decision states that the quota of foreign workers that can be brought in privately will be increased by another 10,000 workers, beyond the 10,000 foreign workers that were approved in the previous government's proposal that was extended on May 5, 2024. In addition, it will be possible to bring foreign workers to the construction industry according to the outline to be determined by the Construction and Housing Ministry.

• It was also decided, in light of the increase in the price of hiring foreign workers—mainly in the construction industry—that the government will work to increase competition between manpower contractors who have a permit to employ foreign workers in the construction industry, thus leading to an increase in the supply of foreign workers in the industry. In this context, it should be noted that the Population and Immigration Authority has already increased the number of manpower companies from 30 to more than 100.

• In addition, the decision establishes a procedure for reducing the fees and permit costs that employers pay to the state for bringing in foreign workers. For example, today employers in the construction industry are required to pay fees and permit costs amounting to over NIS 20,000 per year for each worker. According to the decision, the state intends to reduce these permit fees which ultimately affect the cost of living.

• The decision also significantly strengthens the supervision of the rights of foreign workers. According to the decision, 442 standards will be added—after staff work done by the Ministry of Treasury—most of which are intended for supervision by the Population and Immigration Authority and the Ministry of Labor. For example, to the latter, which currently has only eight standards, over 100 standards will be added.

• The government's decision also says that the state will not approve the bringing in of foreign workers who do not live in countries ranked Tier 1 and Tier 2 by the database of the American State Department concerning human trafficking. This situation will ensure that Israel meets the internationally accepted criteria for bringing in foreign workers.

"Since the outbreak of war on October 7, 2023, many vital sectors of the economy have suffered due to a lack of workers, which has led, among other things, to an increase in labor costs," Prime Minister's Office Director-General Yossi Shelley, stated.

"The current outline continues to strengthen various branches of the economy during wartime through a comprehensive package of reducing regulation and bureaucracy, increasing the number of foreign workers, setting standards for supervision, and lowering costs for contractors and the cost of living. We will continue to work tirelessly and in inter-ministerial cooperation to restore and strengthen the Israeli economy."

"Success will be tested by the result"

In response to the decision on the new outline for foreign workers that the Prime Minister's Office is expected to bring to the government's approval today, Raul Sargo, president of the Haaretz Builders Contractors Association, said: "This is an important step in the right direction, but the outcome will test success.

"One of the main barriers to bringing in workers, which is not being addressed in the proposal, is the heavy bureaucracy that has been delaying the arrival of workers for months, which the association has examined and approved abroad," he said.

"In addition, it is of great importance to approve new foreign personnel corporations and give them the actual possibility to bring workers," Sargo said.

"We very much hope that this time there will be a real change because the construction and infrastructure industry is in a difficult situation that has a dramatic negative effect on construction companies and their quarter of a million Israeli workers, on apartment buyers, and the entire public that is waiting for infrastructure and public buildings, and for the economy in Israel, which is already suffering from a decrease in state revenues and an increase in the deficit."