Simchon on returning the unemployed to work: “We should not trust the government” – General

A special conference of the Israel Democracy Institute was held today on the return of the Corona unemployed to the labor market, towards the beginning of June, when unemployment payments to the laid off and the disabled will cease, according to the latest CBS report, the unemployment rate is 745,000, or more than 18%. Work in Israel between the ages of 25-64.

The conference hosted several senior economists in Israel, including Prof. Avi Simhon, Chairman of the National Economic Council, former Governor of the Bank of Israel, Karnit Flug, Assaf and Serzog, Deputy Budget Officer at the Ministry of Finance and former Histadrut Chairman and Justice Minister Avi Nissenkorn.

The conference talked about whether it was right to end unemployment benefits en masse in June, when the majority were against as long as the level of unemployment remained high. “If we’re talking about what’s going to happen after June, I do not know. Will June just drop the rug and say all the unemployed will go to work because we dropped below 10% unemployment, my answer is absolutely no,” Stated Simhon.

“I support training, but our ability to do things effectively is very, very low. There was a committee headed by the Turner Foundation and Ronen Peretz on training. A lot of people sat down, issued a nice report, and nothing came of it. In the end, the government can do great things. Go Do training, we are very much in favor, we put a billion shekels on it. I do not know if we will spend the billion shekels, and even if we spend them, I do not know what the effect will be. We should not trust the government, but the private market that will do the job. “, Concluded.

Flug said that As long as the ratio between the number of unemployed and the number of jobs remains high (11: 1), government support should continue. “It is important to remember that even after we emerge from the crisis and unemployment rates fall, there will be many people who will not be entitled to unemployment benefits because of the exhaustion of previous entitlements. The aim of the policy is to minimize long-term damage to welfare, employment and inequality.

“We have come a very long way before the welfare crisis to work and employment rates have increased. We hoped that there would be no way back to the expansion of welfare populations following the crisis. A fact to consider when thinking about the safety net, as it has been so far and looking ahead, is the ratio of unemployed to number Job vacancies As of the last quarter of 2020, for every job vacancy there are a little over 11 unemployed, for comparison, in 2019 the number was 1.6.

“In order to accelerate the return to work of as many unemployed as possible, a policy must be adopted that includes stronger incentives to enter the labor market, both positive and less incentives. It should be remembered that the labor market is much less welcoming than it was before the Corona,” Flug said.

On the part of the Ministry of Finance, And Herzog, deputy budget director at the Treasury said Because: “Return goals must be set for employment: for people aged 64-25, about 78%, as was the case on the eve of the crisis, by the end of 2022. We estimate that it will be possible to get there long before.

“We must also focus on the unemployment rate among people aged 24-20, those people who will not go to higher education and are currently unemployed, and make sure that they do not remain in prolonged unemployment and low productivity for many years. First, a gradual exit from the safety net must be planned. Today, perhaps until the end of 2021. Another significant component is the abolition of a 30% reduction in unemployment benefits for those in vocational training, “he said.