In addition to reports of difficult times for Torah institutions in Eretz Yisrael as a result of the financial difficulties in the United States, other areas of the country’s economy are also feeling the crunch.
 
The daily Yediot Achronot provides a comprehensive look at a number of spheres of the Eretz Yisrael economy. Following are excerpts from the report.

REAL ESTATE

It appears that according to the representatives of the nation’s real estate industry, the market has dropped an estimated 5%, although building industry officials state this is just not so. Sales of high-end luxury properties are down, as are the sales of the more standard real estate opportunities. Builders insist the number of projects has not dropped. Second hand home sales however have increased, reportedly as a result of the global fiscal situation.
 
Contractors admit they have been hit, reporting a drop in business, explaining people are too scared to undertake the major expense of renovating at present.

UNEMPLOYMENT

Government officials report 19,000 Israelis reported to an unemployment office in August, joining the growing number of unemployed. Officials explain the number includes 13,000 people whom have lost their jobs and 1,000 young who recently completed military service and are unable to find employment.
 
Labor Ministry officials report that following four years of a prospering economy, the last six months reflect a rise in unemployment. Unemployment is rising on the average of one percent a month. Last month, 194,000 Israelis reported to unemployment offices around the country, with 40% being out of work for a year. Trade and Industry Ministry officials are already predicting unemployment in 2009 will reach 8%, an increase from the current 6.3%.
 
Yossi Farchi, who heads the nation’s unemployment services offices reports that the number of available jobs is down, with his offices receiving 25,000 requests in August, as opposed to 26,000 in July. “The recession has already hit and we are beginning to feel the effect in the working sector” Farchi explains.

ASSISTANCE FOR THE NEEDY

Ironically, as the need increases, organizations assisting the needy report donations are down tens of percent. In addition, donations arriving in foreign currency, especially US dollars, are just worth much less. These non profit organizations are already feeling the crunch, big time.
 
Having just completed the major Rosh Hashanah campaign, the heads of the assistance organizations report the effort was most difficult and it was a major task seeking to meet the growing demand on one side while faced with the reduction in donations on the other side.
 
Shimon Sabag of the Yad Ezer L’Chaver organization reports that private donations dropped 60% in recent months. The average NIS 200 donation of last year was reflected by a NIS 50 this year. “Some people, who give annually, announced they would not be making donations this year. They see the recession and prefer to hold onto their money,” Sabag explains.
 
Officials of the Tachlis organization report donations are down tens of percent. They explain there is a “real war” for every donation and the competition is greater while there are less people willing to donate.”
 
Officials of the Meir Panim-Koach L’tet organization report that commitments totaling NIS millions from the United States are being canceled due to fiscal concerns in North America.

SHOPPING FOR BASICS

Agencies monitoring shopping habits of the Israeli consumer report a decline as well, not only in the beginning of September, but even the Rosh Hashanah shopping season. The average credit card purchase two weeks before Rosh Hashanah dropped from NIS 581 to NIS 561, Gama Nihal U’Slika reports. In previous years, the pre-Yomtov season reflected an average purchase of NIS 650. 
 
The decline has impacted many areas, including clothing, house wares, cleaning products and supermarkets. The computer and electronic industries however are not reporting a decline.

VEHICLE SALES

A decline in vehicle sales is reported over the past five months with the sharpest drop seen last month. While October is expected to be another slow month for new car sales, November and December are expected to reflect and increase as dealers generally offer end-of-year sales in the hope of emptying warehouses of current year models.
 
Nevertheless, it is expected that 200,000 new vehicles will have hit the road in 2008, as compared to 191,000 in 2007. In 2009 however, a decline of 10-20% is predicted.
 
Used car prices have dropped 4-7% and as new car dealers offer end-of-year sales, used car prices are expected to continue dropping.
 
Leasing companies are particularly hard hit as vehicles leased by companies going out of business are being returned. They are trying to sell them to recoup loses but the depressed market is making this difficult.

HIGH TECH

While the high-tech industry is not officially reporting a decline, officials of Israel’s TCS report that during the last quarter, they have slowed down hiring in expectation of a recession. Those hired are receiving salaries 5-10% lower than the previous quarter.
 
It is becoming increasingly difficult to find new investors and some feel that following the Yomim Tovim, there will be salary cuts and dismissal notices.
 
Finance industry officials warn that the global financial crisis alongside credit difficulties and the strong shekel may lead to the dismissal of thousands of high-tech employees. In the last three years, the dollar fell 30% against the NIS. The falling dollar against the NIS has made high-tech employees in Israel too expensive. 
 
It goes without saying that start-ups will be hit hard since it is increasingly difficult to find seed money and potential investors.
 
For now, as is the case in the United States, treasury officials are trying to maintain calm, releasing messages of stability – seeking to assure Israelis that the future is not bleak and the economy in Eretz Yisrael remains stable and strong.

(Yechiel Spira – YWN Israel)