|Rate of unemployement at its lowest level since 2000 in Israel as economy grew by 2.5 % last year
Israel‘s unemployment rate fell to 5.3 per cent, reaching its lowest level at least since 2000. In 2010, it still stood at 8.4 per cent, the Bank of Israel said in its annual report.
The drop in unemployment was attributed to an increase in “employment-intensive commerce and business services” and a boost in public service jobs in the country of eight million people.
The Israeli economy grew by 2.5 per cent last year, in line with the previous two year, when GDP growth stood at 2.3 and 2.6 per cent respectively.
Bank of Israel Governor Governor Karnit Flug said the Israeli economy was "reasonable" given the current global economic climate, adding that Israel‘s limited growth was mainly the result of weak exports.
The strengthening of the Israeli currency, the shekel, was also cited as a reason. Inflation stood at negative 1 per cent, according to the report. The Bank of Israel interest rate was lowered in March 2010 to an all-time low of 0.1 per cent.
Housing prices rose by 8 per cent in 2015 and the record number of 48,000 housing starts were insufficient to curb the price.
“All in all, the labor market is in a good situation; unemployment is low, employment has increased, wages have risen, and the good economic situation allows us to focus policy on matters that we really need to focus on in the long term. I think that this will also free us to focus on the next budget and our major challenges,” said Governor Karnit Flug.
The Bank of Israel projects 2.8 percent economic growth for 2016. It recorded 2.6 percent growth in 2014.