The continuation of the and mobilization of the reserves is harming the manufacturing sector

A sharp decrease in the number of employee posts in the business sector

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The Melnick State of the Israeli Economy Index decreased by 0.2 percent in January 2024. The decrease in the Index reflects the continued effects of the war on the activity of the business sector. At the beginning of 2024, the output of the business sector continues to shrink. The partial recovery observed in the revenue index for commerce and services, reflecting domestic demand and particularly private consumption, somewhat mitigated the overall economic downturn. However, challenges persist on the supply side of the business sector, as reflected in the industrial production index. Evidently, the ongoing mobilization of reserves appears to be adversely affecting the industry’s functionality. The import index, predominantly comprising inputs for domestic production, continues its descent, signaling prevailing pessimism. In real terms, the January import index is 15 percent lower than the same period last year, suggesting a potential future decline in economic growth. Notably, the number of employee posts in the business sector experienced a sharp decline for the second consecutive month amidst the ongoing conflict.

The components of the January Index include January index : a 2.7% decrease in the industrial production index in December, after a 2.6% increase in November; an 8.3% increase in the revenue in commerce and services in December after, a 3.0% increase in November; a decrease of 0.3% in the import index in January, after a decrease of 1.4% in December; and a 3.9% decrease in the number of employee posts in the business sector in November, after a 2.8% decrease in October.

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