15.8.2006
 
New Research in the Bank of Israel: "Commuting Patterns in Israel, 1991-2004"
 
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The opinions brought in the study referred to herein are those of the authors and do not necessarily reflect those of the Bank of Israel
  Commuting––defined as employment outside the employee's area of residence––is widely practiced in Israel; on average in the period 1991-2004, some 43 percent of employees were employed outside their local area of residence and about 28 percent were employed outside their residential sub-district.
  As in other advanced countries, in Israel men commute more than women and commuting rates are higher among younger and more highly educated employees.
  Only five sub-districts––Tel Aviv, Jerusalem, Ramla, Haifa, and Zefat and Kinneret––registered positive commuting balances, that is they had more people entering these districts to work than leaving.
  Commuting is driven mostly by geographical proximity, and by conditions of employment and potential wages in the areas of destination and origin.
Research by Dr. Natalia Presman of the Research Department of the Bank of Israel and Professor Arie Arnon of the Department of Economics, Ben Gurion University of the Negev, examined commuting patterns of Israeli employees in the period 1991-2004 and the factors behind them, where commuting is defined as employment outside of one's area of residence. Commuting was found to be widespread in Israel and 28.2 percent of employees were employed outside of their residential sub-district, on average during the period reviewed. It was also found that Israelis demonstrated the same main commuter characteristics as in other countries: commuting rates were higher among younger employees (aged 24-35), men commute more than women, and commuting increases with higher levels of education. However differences in commuting rates between various age groups do not apparently stem from individual preferences, but differences in the groups' makeup. Examining the changes in commuting behavior of the same cohorts over time shows a significant reduction in commuting rates only after the age of 64.
The research found that only five sub-districts had positive commuting balances––incoming commuters less outgoing commuters––throughout the entire period: Jerusalem, Zefat and Kinneret, Haifa, Ramla, and Tel Aviv. Examining the in-commuting and out-commuting rates found that Tel Aviv was the only sub-district with a pronounced employment orientation (shown by the ratio of employed persons in the sub-district to the district's labor force size, which was 1.63 on average in 1991-2004); that the Holon, and Judea and Samaria sub-districts had predominantly residential orientations, providing jobs for only half their local labor forces; and that three sub-districts––Jerusalem, Be'er Sheva, and Zefat and Kinneret––could be considered autonomous from an employment perspective, as their commuting rates (both incoming and outgoing) were low.
The central finding of the research was that commuting behavior is mainly motivated by geographical proximity, relative ease of finding a job and potential wage level in the destination area compared to the origin district. However commuting in Israel is not necessarily directed toward areas with relatively low unemployment rates.
Concerning possible policy implications, policy-makers must take into account that commuting behavior mainly characterizes highly educated employees, and commuting flows decrease with distance. Therefore reducing the unemployment rate among the poorly educated residents of outlying areas, particularly of the development towns in the north and south, should be addressed through establishing employment centers in the peripheral regions of the economy with appropriate range of employment opportunities for a relatively low-skilled labor force, or improving the public transportation system to ease the access to existing employment centers. This is because for this problem, commuting does not represent an appropriate solution.