The October Index is a preliminary estimate of the impact of the beginning of the war
The war could decrease the business product by 3.8 percent in the last quarter of 2023
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The Melnick State of the Israeli Economy Index decreased by 0.7 percent in the month of October 2023. The October Index is a preliminary estimate of the effect of the first month of the war on the business sector activity. The indicators are still partial; therefore, the estimate may change when the data is updated later. The decline in business sector activity results from several factors: a direct impact on production due to a reduction in the workforce caused by employees being called into reserves, leading to a diminished product supply; reduced commerce and market activity due to consumer behavior changes, with people avoiding shopping centers and decreasing demand; and a decline in tourist arrivals to the country. According to a preliminary estimate, the war could potentially damage the business sector’s product, in the last quarter of 2023, by 3.8 percent, consequently lowering the growth rate of the business product to 1.9 percent in 2023.
The components of the October index include: a 4.0% decrease in the industrial production index in September, after a 5.5% increase in August; a 3.9% decrease in the revenue in commerce and services in September after a 2.5% increase in August; a decrease of 4.8% in the import index in October, after a decrease of 3.2% in September; and a 0.7% increase in the number of employee posts in the business sector in August, after a 0.6% decrease in July.
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