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Press release: Excerpt from the "Bank of Israel – Annual Report for 2012" to be published soon:
Labor Productivity in Israel from an International Perspective


  •  Labor productivity in Israel is 24 percent lower than that of all the OECD countries. Its growth rate between 1995 and 2011 was lower than the OECD average, reflecting divergence.

  • Between 2000 and 2011, the rate of investment in Israel was one of the lowest among advanced countries, which may explain about half of the gap in the productivity level between Israel and the OECD.  The investment rate in Israel is low in all sectors, other than industry which is characterized by external competition that requires companies to adopt foreign technologies.

  • Other factors that may explain the delay in convergence of the productivity level to wealthy countries are: the relatively high volume of work hours per employed person, the harm to employment experience due to the growth in the labor force, and the low level of competition in the business environment.