The economic damage of the war: An analysis of the Economics Department of the Manufacturers Association shows that the Israeli economy has already begun to pay a heavy price for the war that began eight days ago.
NIS 4.6 billion is the price the economy pays as a result of workers not coming to work and a decline in output as a result of the war, due to the shutdown of the education system, the closure of traffic arteries, and the extensive mobilization of reserves throughout the country.
In total, it is estimated that about 1.3 million employees did not go to work this week. However, it should be noted that the shortage recorded in some basic food products (mainly due to the Home Front Command's recommendation to store food) is decreasing, which means that at least the food production industry is managing to function even in conditions of shortage of working hands. The manufacturers' estimate is based on the cost of five working days to the economy, assuming that about 85 per cent of employees in the southern region have been absent from work, along with another 20 per cent throughout the country, and that about 25 per cent of parents who had to be absent from work to look after their children can work from home.
Shopping at the supermarket (illustration), photo: Oren Ben Hakon
A severe economic blow
President of the Manufacturers Association and Chairman of the Presidium of Employers and Businesses, Dr. Ron Tomer, said following the assessments, "There is no doubt that the war is a severe economic blow to the economy, and we will have to be strong and united in order to get through the crisis. Israeli industry in particular is currently suffering from a shortage of workers as a result of going to war, but we are making every effort to continue working regularly, and are confident that we will be able to supply the beloved Israeli products to every home in Israel.
"The main problem is logistics, but we are also finding solutions for this, and despite the difficulties, no significant shortage is expected on the shelves."
Ron Tomer, Photo: Oren Ben Hakon
It should be noted that this estimate does not take into account additional and very significant financial damages, the economic assessment of which will be only at the end of the fighting, such as direct damage to factories, damage to profitability and indirect damages such as damage to reputation vis-à-vis customers abroad, cancellation of transactions, non-compliance with timetables, depreciation of the shekel, and more. Also, the estimate does not take into account the damage resulting from a decrease in output.
"50% work less"
Nir Levinger, CEO of the Central Beverage Company, which markets Coca-Cola, Neviot and Frigat, among others, told Israel Hayom: "I estimate that we are now working with 50% less workers. These are hundreds of recruits of the company's employees and dozens of family members. We did not file a motion to cancel Order 8. Cottage and Coke are no more important than a tank.
"Unfortunately, there is an employee of Tara who was at the party and is still missing, one employee whose husband was apparently kidnapped, other employees whose daughters are missing. It's a complex coping. "On top of that, the issue of drivers is very problematic, we have a big shortage of drivers. Our factories are located from north to south. Tara's factory is located in Netivot near Ofakim and Sderot and this is undoubtedly a significant event.
"There are dairy farmers who were murdered and we have many workers who live in the envelope. The southern line has more than 1,000 employees living there. A large part of the milk comes from the envelope and this is significant."
Neviot Company Building (Archive), Photo: Yehoshua Yosef
In the central company, the mineral water of Neviot is produced. It should be noted that these days it is not possible to find mineral water of all companies due to high demand and because of the shortage of workers.
According to Levinger, "We produce mineral water 24/7 and we also produced for the Ministry of Defense, because of the instructions of the Home Front Command, everyone went to store mineral water and there is ostensibly a shortage, but we produce all the time.
"We deliver almost every day to all writers. These are huge numbers. We deliver 150,000 sixes daily, 3-2 times as many as on a normal day. "This week we will be all of us, all the company's employees in the orchards because there are no workers, some of the workers are recruited. We will take control of this and help the orchards pick the fruit from the trees. If there's one thing I'm proud of, it's our employees. In addition, local industry is always important, especially in times of war."
Pini Gurevich, CEO of Zanlach, which markets Yachin products and Golan Heights Dairies, says, "At the Yachin plant in Alon Tavor we produce canned vegetables and sauces, and at the Golan Heights Dairies in Katzrin, milk and cheese. In both factories, we work with a great shortage of workers, following the recruitment of workers under Order 8. In the Golan Heights Dairies in Katzrin, for example, out of about 80 employees, 30 are currently under Order 8.
Dairy sector activity declined
"Thanks to the fact that both of our factories are located in the north and since we are after the vegetable agricultural season, we are getting through things in a reasonable way.
"In the dairy sector, we can't bring in a workforce because we need professional people, so what we don't feel in vegetables, we feel in milk. In regular milk, we don't produce less because it's automatic, so we need less manpower. Cheese and dairy operations declined by 40-30 per cent due to labour shortages. We allocate our manpower to distribution channels, which is the most important thing."
Fewer dairy products on the shelves, photo: Oren Ben Hakon
Gurevich notes that the company provides emergency inventory that is planned and predefined. "We send to the army everything it can absorb, and first of all we send it to the army. The same goes for dairy products, we supply the IDF, end units and even provide chocolate milk to soldiers."
"Working about 20%"
And if factories that produce food continue to function with great effort, then in other, non-essential areas, activity is almost shut down. Amnon Schwartz, owner of the Aminoach factory, told Israel Hayom that "the headquarters workers work from home because they are afraid to come.
"We have quite a few people who have been drafted into the reserves, there are also production workers who don't come for all sorts of reasons, and there are also Palestinian workers who don't come at all. Also the shops don't work because there are no orders. We manufacture to order. I estimate that we are working at 30-20% of the ongoing activity, nothing more."
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