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Yoram Ettinger: Israel’s Brain-Gain; No Brain-Drain

Yoram Ettinger

Ambassador (ret.) Yoram Ettinger, “Second Thought: a US-Israel Initiative”
Straight from the Jerusalem Boardroom #234, https://bit.ly/2VfFw89
December 28, 2018, previous Boardroom issues: https://bit.ly/2NB51fk

1. According to Adam Reuter, Chairman of “Financial Immunities” and author of the 2018 Israel – Island of Success (Globes Business Daily, Dec. 19, 2018): Israel is not afflicted by brain-drain, but benefits from brain-gain.

While Israel’s establishment documents net-migration of higher-education Israelis, it fails to document the massive influx of higher-education Olim (Jewish immigrants).  About 2/3 of the Olim – 18-years-old and older – have gone through higher education. For instance, in 2015, Israel’s Central Bureau of Statistics reported a brain-drain of 1,360 higher-education Israelis, ignoring the 14,870 higher-education Olim, who arrived in 2015, 48% of whom possessed graduate degrees and PhDs.

While the ratio of higher-education Israelis (compared to the entire population) ranks third in the world, following Japan and Canada, the ratio of higher-education Olim is significantly higher than the rest of Israel’s population. Over 25% of the Olim are experienced in the critical areas of hightech, engineering, computer science, medicine and health.

From 1980-2010, 30,000 higher-education Israelis emigrated (the total of exiting, minus returning Israelis), while 290,000 higher-education Olim arrived from the USSR, France, the USA, etc.. Considering the 25,000 higher-education Olim who emigrated, there was a net brain-gain of 235,000 from 1980-2010.

From 2010-2018, some 105,000 higher-education Olim arrived (out of a total of about 198,000 Olim), while 22,000 higher-education Israelis emigrated – a net brain-gain of 83,000; an annual net brain-grain of 9,000.

From 1980-2018, there has been a net brain-gain of 315,000 higher-education people!

Moreover, from 2010-2016, 4,000 PhD Israelis returned to Israel with enhanced experience and networking, providing tailwind to economic growth.

2. Israel’s 2018 economic indicators according to Bank of Israel: Israel’s public debt to GDP ratio: 60.4% in 2017, 66.1% – 2014, 71.1% – 2010 [225% – 1985], compared with the European Union – 81%, Britain – 85% and the USA – 105%.
GDP growth – 3.7%, GDP per capita – $39,600, unemployment rate – 4.1%, inflation rate – 1.2% [445% – 1985].

3.  Israel’s ultra-orthodox Jewish population has been increasingly integrated into Israel’s economy, as documented by Eli Paley, the founder and Chairman of the Jerusalem-based Haredi (Ultra-Orthodox) Institute for Public Affairs. The Haredi Institute – in cooperation with top (secular) Israeli hightech entrepreneurs – is dedicated to the enhancement of the Haredi integration into Israel’s hightech sector.  The latter is the major driving force behind Israel’s economic growth, but is threatened by a growing shortage of skilled developers.

The goal of the Institute is to increase the number of Haredi persons in the hightech sector, while moving them from low-tech to high-tier positions.

The Haredi community has expanded from 4% of Israel’s population in 1980 to 11% in 2018, while accounting for approximately 20% of the younger-than-nine population.

While 18% of the working Haredi women possessed academic degrees in 2006 (compared to 7% of the Haredi men), the volume grew to 24% in 2016 (compared to 11% of the Haredi men).

A recent study, by the Institute, on The Quality of Life among Israel’s Population Groups, documents a rise in the employment rate among Haredi men from 40% in 2008 to 52% in 2018, while the employment rate among Haredi women surged from 57% to 75% over the past decade. However, despite the rise in employment, the majority of Haredi Israelis remain employed in lower-level positions.

According to tests and evaluations conducted by the Haredi Institute, the graduates of Haredi seminaries – in the computer science track – demonstrate talent, strong work ethics and ambition equal to the secular population.

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