The slowdown of the business sector continues
The economic slowdown is also reflected in the labor market
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The Melnick State of the Israeli Economy Index decreased by 0.1 percent in May 2023. This decline indicates a continued slowdown in the business sector’s economic activity. It appears that a combination of global economic slowdown and the impact of attempting to implement significant changes to the legal system in Israel is hindering the growth of the business sector. The revenue in commerce and services, which reflects domestic demand and especially private consumption, expresses a stagnation of private consumption. The industrial production index, which reflects the supply side of the business sector, failed to recover following a sharp decline in the previous month, highlighting weakness in the supply side. The import index, which consists mainly of inputs for domestic production, rose slightly this month, after declines that began in October 2022. The number of employee posts in the business sector fell again and it seems that the economic slowdown is also reflected in the labor market.
The components of the May Index include: no change in the industrial production index in April, after a 2.2% decrease in March; a 1.6% decrease in revenue in commerce and services in April after a 1.7% increase in March; a 0.3% increase in the import index in May, after a 0.4% increase in April; and a 0.3% decrease in the number of employee posts the business sector in March, after a 0.3% decrease in February.
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