A troubling new report from the Israel Innovation Authority, titled “Long-Term Relocation in High-Tech”, reveals that approximately 8,300 Israeli tech professionals have relocated abroad for a year or more since the outbreak of the war in October 2023. This figure represents roughly 2.1% of the entire high-tech workforce in Israel.
The report, released Monday morning, marks the first documented decline in employment in Israel's high-tech sector in over a decade, and reflects a broader shift in workforce distribution—favoring international hires over domestic ones.
Key Findings:
- Israeli tech companies now employ more people abroad (approx. 440,000) than in Israel (approx. 400,000).
- The monthly average of long-term relocations stood at 826 tech workers, peaking at 1,207 in October 2023.
- The industry has seen a net loss of 5,000 workers in 2024 alone.
- Multinational hiring is rising—Israeli companies hired 4,500 R&D professionals and over 2,000 sales/marketing staff abroad this year.
The data is based on cross-referenced figures from the Population and Immigration Authority and Israel’s Central Bureau of Statistics.
Why Are They Leaving?
The report attributes the surge in departures to growing political instability, national security uncertainty, and a stagnant local employment landscape. Unlike previous years where tech employment outpaced the broader labor market, the growth rate has now plateaued.
Companies like Waze, Gett, and Sygnia—all privately held Israeli tech firms—now employ over 50% of their workforce abroad, including core R&D teams, long considered Israel's strongest advantage in the global tech race.
Even more concerning is the situation among public Israeli companies like Check Point, NICE, and Wix, which now employ only 60,000 workers in Israel out of 260,000 globally.
Wider Implications:
The exodus is not just about numbers—it’s reshaping the structure of Israel’s tech sector:
- Roles in non-technical fields (product, operations, etc.) are shrinking significantly.
- The share of tech employment within Israel’s overall workforce has stagnated around 11.5%, after a decade of steady growth.
- Salary gaps are widening—average tech salaries now reach ₪32,300, nearly 2.8 times the national average.
The AI Effect & Urgent Recommendations:
The report also flags the impending impact of artificial intelligence, which is expected to reduce staffing needs across the industry, adding urgency to the need for structural adjustments in education and workforce training.
Dror Bin, CEO of the Innovation Authority, stated:
“In this time of political, security, and economic uncertainty, the data reflects a series of challenges that require immediate action—employment stagnation, changes in job composition, and rising relocation. Ensuring the future of Israeli high-tech demands joint effort between government and industry, investment in human capital, and incentives to bring talent back home.”
Among the key recommendations are :
- Stabilize the business environment to reduce uncertainty.
- Update tax and relocation incentives for returning Israelis.
- Expand government-industry cooperation to retain top talent and boost domestic hiring.
