The Manufacturers' Association warns: Employers plan to lay off about 30,000 workers during the holidays • Manufacturing output was severely affected: 37% in the second quarter and another 16% in the third • Association president: "The expected wave of layoffs clearly indicates the aggravating situation of Israeli industry"
Alkogel factory
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More than 30,000 people employed in the manufacturing industry are likely to lose their jobs during the holidays, according to data obtained by Israel Today.
This is according to a "survey of expectations for the months of July-October" conducted by the Manufacturers' Association among 169 industrial companies, and its data are published here for the first time. 11% of companies responded that they intend to continue laying off employees in the third quarter of the year - more than twice as much as in the same period last year. However, the third quarter is an improvement over previous quarters.
Archive // Photo: GPO
It should be noted that the Manufacturers' Association is not an objective body, and by virtue of its position as representing the manufacturers seeks to pressure the state to increase its investments in local industry, including through the acquisition of "Made in Israel" in infrastructure projects. According to the Ministry of Finance, over-reliance on local industry means raising the cost of living for the general public in the form of price increases of 15% -10%, which could add up to tens of billions of shekels.
Since the beginning of the Corona crisis in March, 36,000 industrial workers have been laid off and taken out, representing about 10% of all workers in the industry. The Manufacturers' Association notes that the continuation of the layoff trend may deepen the crisis The industry is in a steep decline, and in the second quarter 20% of employers reported that they do not need new employees - compared to 10% in the first quarter and only 3% at the end of 2019.
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• Over NIS 1 billion for manufacturing
Manufacturing output was also hit dramatically due to the corona crisis, with manufacturers reporting a negative net balance of 37% in the second quarter and expecting a further 16% hit in the current quarter. The impact also applies to factories abroad - where there was a decline in all indices: output, investments and the number of employees. Improving trend with a decrease of 25% In terms of export profitability, there was a drop of 34% in the second quarter, after 19% in the first.
The volume of investments in manufacturing is expected to decrease in the current quarter by industry by 11%, compared with an increase in this index in the corresponding quarter in 2019. Sales expectations for the domestic market will decrease by 20% - an improvement over the previous quarter (a decrease of 37%). 55% of manufacturers reported difficulties in maintaining a credit line in the previous quarter, and more than half of them have difficulty obtaining new credit.
The president of the Manufacturers' Association, Dr. Ron Tomer, said: "The expected wave of layoffs testifies to more than a thousand words about the deteriorating situation of Israeli industry, which is having a hard time surviving the corona crisis; However, we can and should prevent the next wave - the Israeli government must take responsibility, and fully expand and implement the preference for the country's products in public tenders. Through this priority, Israel will be able to create tens of thousands of new jobs in the economy, reduce unemployment and provide the unemployed with a new and promising career alongside employment stability in industry, which is the driving force behind the growth of the Israeli economy. "