Summary:
- The level of inequality in Israel is among the highest in the Western world and is high in historic terms as well, though since 2006 the level of inequality has stabilized and even declined slightly.
- The increase in the rates of employment among population groups that are characterized by low participation and employment rates and a high incidence of poverty (particularly among Arab women and the ultra-Orthodox) has increased their relative share of income and has contributed to a reduction in the inequality of economic income.
- The decrease in inequality and poverty in terms of economic income was offset by the shift in government tax and transfer payments policy, which made it less progressive, and which increased inequality in net income.
- The average income of a middle class household has grown at a faster pace than the prices of most goods and services since 1997. Nonetheless, price increases accelerated since 2007 and the prices of housing services, rent, food, electricity, gas and water have grown faster than income.
- The increase in the proportion of the elderly in the general population, which is expected to accelerate in the future, bolsters the need to improve, and increase the efficiency of, the long-term care of the elderly.
Welfare Policy Issues - PDF file