In the wake of the labor shortage caused by the barring of Palestinian workers for security reasons after the Oct. 7, 2023 attack, Israel has turned to Indian laborers to fill construction jobs.
Approximately 16,000 Indian workers have arrived over the past year, with plans to recruit thousands more, according to AFP. While this initiative has eased the labor gap, it falls short of replacing the 80,000 Palestinians from Judea and Samaria who previously worked in the sector, slowing construction and risking a housing shortage.
According to Eyal Argov, head of the Macroeconomics and Policy Division in the Bank of Israel’s Research Department, before the attack, the construction industry employed about 80,000 Palestinians and 26,000 foreign workers.
Now, about 30,000 foreign workers are employed, significantly fewer than pre-war levels. Argov highlighted that construction activity in late 2024 was approximately 25% below pre-conflict levels.
Despite the growing number of Indian workers, Argov cautioned that their numbers remain insufficient to meet demand. While there is no immediate housing shortage, delays in the supply of new housing could occur. With Israel’s population growing at an annual rate of 2%, such delays may lead to shortages in the future.
