In the previous article (2/12/22) I wrote that people choose not to live in Haifa and this is reflected in the average price of an apartment in the city, which is one of the lowest in Israel (1.4 million NIS). I also wrote that the entire responsibility falls on the Haifa Municipality and its leader and that quantitative targets will be published to the public, necessary for proper management. In addition, I focused on the employment problem in Haifa, which in my opinion is one of the main causes of the unattractiveness of our city.
In the present article we will dive into the employment problems, examine representative numbers and their meaning and conclude with a solution plan. Come on, let's start…
A very disturbing fact
After all, you have a statistic, unfortunately extremely disturbing: 86% of the vacancies for software developers in 2021 were in the Tel Aviv and Central districts. What was the percentage of vacancies for software developers in Haifa? 6% only! And by what percentage did the number of jobs in Haifa increase in the years 2015-2021? Only one percent! Yes yes, you read that right - by 1%. Does anyone think this negligible increase is coincidental? On the contrary, such an increase indicates a continuous management failure over many years. When the goal is not defined, there is no one responsible and there is no plan - there are no results either.
Some may ask, why do I focus specifically on software developers when there are so many other important professions? Well, software developers represent a significant part of those employed in high-tech. As we know, this is an economic sector and a national and international growth engine that is one of the strongest in the country, which can greatly benefit Haifa. To understand how high-tech is economically significant, It is worth reviewing the annual report - the state of hi-tech 2022 of the Innovation Authority. In 2021, the percentage of employees in the high-tech industries of all employees in Israel was 10.4%. One tenth of the employees in the economy - doesn't sound like much, right? But notice how much this tenth contributes to the economy: 54% of total Israeli exports in 2021. In other words, one tenth of the employees in high-tech export half of Israeli exports. In addition, the growth rate in the amount of employees in hi-tech Tech is 8 times higher than the growth in other sectors of the economy and for dessert, the capital raisings in 2021 amounted to 27 billion dollars and of these, 88 capital raisings were carried out, each of which was over one hundred million dollars. Imagine how this would affect Haifa if it participated in the celebration.
It is important to understand that growth and growth in the high-tech sector creates additional circles of employment in areas such as accounting, law, human resources, construction, catering services, cleaning and more. So much for the good news, now on to the bad news. The described success in the high-tech sector is not evenly distributed in the country. In fact, the representation of the residents of the center in hi-tech is 35% greater than their relative share in the salaried population in Israel. On the other hand, The representation of the residents of the north and the south in hi-tech is about 33% lower than their relative share in the salaried population in Israel. If you look at employment in start-up companies, the situation is even worse: In 2020, 72% of these companies and 78% of the salaried jobs in which they were concentrated in the districts of Tel Aviv and the center.
Not everyone is high-tech, rightly so. If so, let us compare the percentages of employed residents of Haifa and Tel Aviv, by economic branch, as a percentage of Israel's population. The percentage of employed residents of Tel Aviv is approximately twice as large (2 to be exact) than its counterpart in Haifa. Therefore it is expected that in a normal situation, the percentage of employed people in Tel Aviv in every economic branch will be twice that in Haifa. Pay attention to the table below, where severe disparities in the percentage of employed people in the two cities are marked in red by economic branch, and next to them is the approximate disparity.
(Source: Haifa Statistical Yearbook 2021: Employment - 2019 data)
Where does Haifa "star" negatively?
In the tourism, information and communication, banking and insurance, real estate and entertainment industries.
surprising? No!
Based on numbers so they don't smear us? Yes!
And this is the heart of the matter, the grim reality in numbers. Neither gut feelings nor slogans. So we realized that the situation was bad, very bad. Such a deterioration over the years when the economy is growing, clearly indicates the failure of Klish as well as her predecessors in the position. True, this is a big challenge, but what exactly did Klish do about it in her four years in office? This, in my opinion, is the root of the problem and here, in my opinion, lies the solution.
In Lewis Carroll's famous book - Alice's Adventures in Wonderland, Alice meets the Cheshire Cat and asks for his direction:
"Could you tell me please, which way should I walk from here?" Alice asked.
"It largely depends on where you want to go." said the cat.
"I don't care so much where," said Alice.
"Then it doesn't matter which way you go." said the cat.
"- Provided I get somewhere" Alice added as an explanation.
"I'm sure you'll come, if you just keep walking" said the cat.
When you don't identify the main problems, you don't come up with solutions and you don't build work plans with indicators - then surely you end up somewhere... the sad place where our beloved city is today.
Solutions - the 12-point plan
Below are initial recommendations for an action plan. Of course, a lot of work is required, but if these recommendations serve as a compass pointing in the right direction, we will discuss it.
- Defining the issue of employment and business development in Haifa as of strategic importance and prioritizing the high-tech sector.
- Setting a numerical goal of increasing the number of jobs by 10% each year.
- Appointing a responsible for the field of employment and business development.
- Establishment of a city development consortium (association) with the participation of representatives of the Technion, Haifa University and businessmen - led and managed by the mayor. Commitment to regular monthly meetings and follow-up management.
(It has been proven that an increase in employment is related to proximity to centers of knowledge - the Technion and Haifa University should be leveraged as employment growth engines.) - Building a detailed and measurable work plan, which includes required resources, in order to meet the employment goals. There will be a reliable monthly report to the public on the program's achievements.
- Raising investments through the permanent presence in Jerusalem of the mayor and his senior representatives - near the tables of the decision-makers and state budgets. Pressure the government to prioritize Haifa for benefits such as Yokneam, Beer Sheva, Jerusalem, etc. We must work with the government and not against it.
- Creating a tripartite employment plan: Haifa Municipality, the Technion and the Arab population and financing the plan with the help of existing and dedicated government budgets for the promotion of the Arab sector in Israel.
- An appeal to the IDF (which has a large budget) for a joint examination of the expansion of activity in Haifa and the north (see the entry for the City of the Behadim) while creating jobs in Haifa.
- Holding meetings with large companies (high-tech, banking, real estate, insurance, etc.) outside of Haifa in order to understand what is required for them to establish operations with us, as well as studying other successful cities.
- Regular meetings with economic delegations and investors who frequently come to Israel and joint thinking on how to attract them and motivate them to maintain their activities in Haifa.
- Appeal to venture capital funds and their encouragement in cooperation with academia, businessmen and the municipality to open branches in Haifa. Financial encouragement for students and local entrepreneurs to open companies and businesses in Haifa.
- Definition and staffing of a fast track for solving business problems proactively and reactively - the municipality at the service of businesses in the city.
As you know, Haifa has many problems that require treatment. However, it is important to focus on the most difficult problem of all - employment. Its solution will have a positive effect on the other problems. Occupational and economic development will bring about the welcome growth of the city that we all love, will attract new and high-quality residents, will preserve the young people, who are the children of all of us, and will bring about positive immigration to the city.
Such economic development will increase the number of businesses in the city and flow money into the municipality's coffers, so that it can facilitate and invest back in us, the residents and the businesses. The first step is identifying the problem and defining solutions. I am confident that with a worthy mayor, open-minded and willing to accept help, we can put Haifa on the high road it deserves.
In the following article we will discuss the characteristics and qualifications required of a candidate for mayor in order to be worthy of our support.
[...] I reviewed the city's problems and what they boil down to, I focused on the issue of employment which in my eyes is one of the city's strategic problems and I proposed 10 [...]
Oh well. Analysis in shekel.
A great example of a response that contributes nothing to the discussion.
There is no explanation, no facts and no message other than Noel's attempt to belittle fact-based analysis.
Some people have no right to speak. Not even the right to tweet. Before the construction of the stadium in an impossible location in southern Haifa, there was an intention to place it in the Check Post area. Accessible to public transportation and enjoy unlimited parking during the games. Guess who objected? When a construction plan came up for discussion on land classified for construction on the slopes of Lincoln and Tel Aharon. Guess who pressed almost violently for the approval of a tiny section of the plan on green lands owned by the Ofer brothers?
I didn't understand why the location of the stadium in South Haifa is "impossible" when it is a 4-minute walk from the Carmel Coast train and in the shortest and most convenient location for most Haifa residents = much more convenient than getting to Haifa Bay, which is also dangerous. Imagine placing a stadium near the refineries or near the ammonia tank (have you forgotten it?) or the gas farm that Yahav transferred to us from rolls. Can you imagine 30 people having to evacuate because of a flame in a chimney in Bezan in the middle of a game? The decision on the location of the stadium is excellent, only a residential neighborhood should not have been created around it, but a business and high-tech neighborhood only. It is not our fault that Benaot Peres reproduced the problems of the Kiryat Eliezer Stadium with the neighborhood around it. Make complaints only to the failed city engineer. The municipality was ordered by the court to construct a pedestrian bridge over Route 4 to the train parking lots and the beaches and it refuses to construct the bridge. Is this a problem for Galbhart or the municipality of Yahav and Klish? Let's remember that Yona Yahav did not want Park Hecht, he thought it was a place for industry. Didn't want the southern residential entrances thought it would be an industrial area. Sold 51% of MTM to Gev Yam and caused the residents of Haifa losses in the hundreds of millions of shekels that went to Gev Yam instead of the city coffers as CEO of the economic company. I suggest to those with a really short memory to do an investigation on Yahav's hundreds of failed decisions.
I am afraid that the solutions you proposed will result in more business and less employment. What do we actually do? I did not find practical answers to this, only the same "administrative" suggestions of the familiar and purposeless type. Meanwhile, some of the horses ran away from the stable. Do you know the technical school of the Air Force? It was supposed to develop in a big way, as a general technological college of the IDF, thousands of employees, tens of thousands of apprentices. All this is expected to happen, but not in Haifa, but... in Karmiel. Because the municipality of Haifa, of Yahav first and of Klish after him, gave it up without batting an eyelid, so that the vast areas would fall as a ripe country in the hands of Hani, the Israel Ports Company, which functions according to my feeling as the China Ports Company.
In Be'er Sheva there is a branch of the technical school. Try to get one computer and a printer out of it. Mayor Danilovitz is kicking you out of town...
Is it still possible to stop Haifa's stupidity parade? Depends on the results of the upcoming municipal elections.
Hello Shmuel,
It is not the solutions that generate business or employment, but through their implementation. In other words - management. I believe that a suitable mayor who will act in accordance with the 12-point plan as a basis will be able to bring about a transformation in the city.
Hello Hanan. You are quite naive, and sorry for the bluntness. About 25% of Haifa residents are retirees, pensioners with a large budget pension who have left the employment circle. About a third of the city council are pensioners, who personally do not care about employment. They and their children, some in Haifa and some long gone, are occupationally arranged and so is their circle of associates. If you ask them, you will be amazed to hear that they don't think Haifa has an employment problem, but a lack of attractiveness towards young people, who work in Haifa but don't live there. According to them, even if you greatly increase employment in Haifa, it will not change the city's situation because a very high percentage will not move to live there, and vice versa - quite a few of Haifa's residents work in Kneam, Herzliya, and the surrounding industrial areas.
There are 5 factors that harm all the points you have listed for dealing with encouraging employment: 1. The city does not have an accessible international airport, which prevents companies from locating management there and harms the development of tourism and conference hosting industries, etc. 2. The property tax for businesses is not exactly as attractive as the property tax for residences. 3. Matam's monopoly. Matam, which belongs to the municipality and Geb Yam, does build high-tech office space, but it is the only one. There are no other hi-tech parks in the entire Haifa area, with the exception of the one in Yakneam and the one in Yakneam. 4. The withdrawal of the biotech sector: Haifa relied heavily on the idea that it would lead a biotech niche adjacent to the many hospitals in the city. This simply did not materialize. For all kinds of reasons. 5. Lack of incentives to build a strong MRA. A new office tower has not been built in Haifa outside of the MTM for 20 years. There are a few small buildings here and there in Chek Post and the Government Building, not even 5% of what was built in Tel Aviv for employment. There are no national incentives to build offices and strengthen the city's economy, and Haifa already It is not seen as the 'capital of the north' or 'the capital city that needs to provide employment'.
On the contrary, the state invests in the cities around Haifa to encourage employment there and further weakens the existing one (for example, the removal of the technical school to Karmiel, or the transfer of the railway management from Haifa to Lod).
He was a mayor for 15 years who didn't care. Although he embarrassed the state of Tel Aviv, he was one of the major contributors to its establishment in the failed management of Haifa, which did not become a better alternative to high tech than Herzliya and Ramat Ha'il.
When the city council has a third of retirees who are not interested in employment, and another third from sectors who are only interested in budgets unique to their sector, then don't be surprised that this is an issue that doesn't come up. There is simply no one to move things. The city is a prisoner of a mayor under any criticism, a relatively sleepy city council whose hands are still tied by legal advice, and a financial company that is engaged in the purchase of a pool because there are no operators in the private market.
Hello Eyal,
I will directly address the arguments you raised.
1 - Most pensioners have children and grandchildren. Those who do not find employment in Haifa leave them and move away from their parents. I don't know any parent who is happy that their children are moving to another city. Therefore, it is not clear to me why you say that employment "doesn't bother them". All the pensioners I talked to are very upset about their children leaving.
2 - Haifa residents who work in Yokneam, Herzliya, Tel Aviv, etc. do so with difficulty. I find it hard to believe that someone would volunteer to invest an hour and a half in a daily commute to Tel Aviv if there was no possibility of working close to home.
3 - Haifa does not have an accessible airport. Neither do Yokneam, Herzliya, Ra'anana, Kfar Saba and Petah Tikva. Regarding tourism, it is indeed a painful issue that an airport might have helped a little. The problem in Haifa is that there are no tourist centers and anchors will cause tourists to spend more than an hour here - going to the Louie Promenade, photographing the view of the Baha'i Garden and on to the next attraction outside of Haifa.
4 - Matam Park almost never grew because there is no demand. The same is true in other areas of the city. Yokneam grew because the mayor of Alfasi was very talented in getting his city a national priority area and offering benefits to companies.
5 - The withdrawal of the biotech field - in my opinion, this is not about the withdrawal of the field, but rather an unfortunate choice to begin with. Biotech and the medical field they are trying to promote in the city are among the most challenging fields in terms of fundraising, need for investment in development, regulation and time to mature into a product. In Haifa's situation where it needs quick victories, it would be better to focus on software industries, AI, perhaps in the field of IoT. This is of course a subject for significant discussion.
6 - Lack of incentives / building m/shared - again, a matter of supply and demand. Why would a developer build an office building when he would have trouble housing it?