New Approaches to Employment Policy

In the 1990s, the massive wave of immigration from the former Soviet Union and Ethiopia posed a large challenge to the Israeli labor market trying to integrate populations with extreme variations in skills and experience.  At the time, MJB’s studies were pivotal in informing national policies to more effectively help the new immigrants make the transition and find appropriate employment.

Employment was also central to a major government policy shift in 1995 that placed greater emphasis on addressing poverty through work rather than through income support.

Against this backdrop of shifting government policy and an awareness of the importance of integration into the labor force, the Institute created the Center for Research on Employment of Disadvantaged Populations in 2003.

In the years since, Israel’s national employment policy and infrastructure has been transformed, with the investment of significant resources, the development and dissemination of new employment models, and an understanding of the importance of taking a multi-pronged, holistic, and integrated approach.


In the early 2000s, a joint MJB-Social Security Administration study revealed that, unlike the prevailing public image, a considerable proportion of income-support recipients had a history of employment.  In fact, 27% had held a steady job during the previous five years.  Furthermore, almost half of the recipients who were not working were either actively seeking work or wanted help to find work through professional guidance and counseling, supplemental education and vocational training, and financial assistance for childcare.

This study served as important background for the decision by the government to establish the Tamir Commission to reform the government’s income support policy through more integrated employment models.  Based on the Commission’s recommendations, a national welfare-to-work initiative was launched on a pilot basis in 2005.  MJB served as the professional coordinator for the Tamir Commission, and then conducted the evaluation of the pilot.

The initiative generated tremendous controversy, with sharp ideological lines drawn over the merits or faults of the reform.  Eventually, the Knesset refused to accept the government’s proposal to expand the program nationally.

What did continue, however, was a number of initiatives to promote employment among disadvantaged populations.

One major step was the introduction of an Earned Income Tax Credit (wage subsidy for low-wage earners) as a policy tool for incentivizing employment and improving the income of the working population at the bottom of the income scale.  The credit was based on a similar program that had been extensively implemented in the US and was spreading to other countries. MJB’s monitoring and evaluation of the program, conducted together with the Bank of Israel and Israel’s Social Security Administration, enabled the government to refine the program and eventually introduce it nationally in 2011.  The Institute,and its partners in the evaluation, released a further follow-up of the national implementation in 2015.

In this same period, the Ministry of Social Affairs made its own major policy shift, based on the recognition of the key role that employment plays in a family’s social and economic rehabilitation.  The Ministry decided to significantly introduce employment-related assistance into its work with the full range of clients served by the Ministry, including disadvantaged youth and young adults, families with complex problems, and people with addictions, and to expand its work with people with disabilities.  As a part of this shift, the Ministry introduced the concept of an “employment social worker” to work with families in a more holistic and integrated manner, and help to increase their participation in the labor force.  MJB’s evaluation of the pilot helped the Ministry in its decision to set up a national network of regional employment centers that the Institute is now evaluating.

Significant additional changes were also underway in the area of employment of people with disabilities.  In 2005, the same year that the welfare-to-work program was introduced, the Laron Commission recommended a significant restructuring of the national Social Security Disability Insurance System to introduce new incentives and supports for the employment of people with disabilities.  After serving as the professional experts for the Commission, MJB undertook a multi-year evaluation of the implementation of the recommendations and the uptake of the new incentives.  The findings have been used to refine and reshape the incentives in order to increase the uptake by people with disabilities.

In recent years, there has been a growing focus on the challenges facing young adults and their transition to adulthood.  In 2014, MJB carried out the first national survey of three groups of young adults: those who were neither working nor studying, those with disabilities, and those with 12 years of schooling or less.  This path-breaking study has helped to inform the government and JDC’s development of new programs for this disadvantaged population.

Working with JDC-TEVET

In 2005, JDC-Israel established TEVET (a Hebrew acronym for T’nufah B’Ta’asukah, or Momentum in Employment), a partnership with the government focused on incubating new models of employment services and promoting their national dissemination.

From the start, MJB worked closely with JDC-TEVET in its strategic planning, and in the planning and evaluation of its various initiatives, both in the pilot stages and in their national rollout.  Some of the most important studies have focused on the development of models to promote employment opportunities for Arabs, ultra-Orthodox, and Ethiopian-Israelis, again with a focus on a more holistic and integrated approach.  These JDC-developed programs ultimately were adopted by the Ministry of Economy and the Ministry of Social Affairs for national dissemination.  (See the article on Arab employment for more on MJB’s work with JDC-TEVET.)

The work with JDC has also focused on making employers more aware of the challenges that disadvantaged populations face in integrating into work.  Studies such as the evaluation of JDC-TEVET’s program to introduce culturally fair employment tests have helped lower barriers to integration.

International Activities

As the work of MJB’s Center for Research on Employment of Disadvantaged Populations expanded in Israel, international interest in the Center’s work has expanded as well.  Of particular note is the ongoing collaboration with the OECD (Organization for Economic Cooperation and Development), the international development organization for the world’s largest western economies.  In 2009, MJB conducted national studies on Arab employment and immigrant employment, both of which were used in assessing Israel’s application for admission to the OECD.  Following Israel’s acceptance in 2010, MJB prepared the first and second progress reports on the implementation of the OECD’s recommendations for labor market and social policy reform.

The Center has also played an important role in providing critical data for the international Jewish community, which has become more involved in the issue of employment of disadvantaged populations in Israel. Fact sheets and regular updates help inform Federations, foundations, and other organizations in their own philanthropic and service efforts.

Most recently, the Center’s international activities have been concentrated on the issue of reforming vocational education and training (VET), a critical tool to promote and upgrade the employment of disadvantaged populations. This includes a collaboration with the European Training Federation, and a cooperative effort between the governments of Israel and Germany to exchange experience and knowledge in developing the VET systems in both countries.  (See the accompanying article on vocational training and apprenticeship.)

A Transition in Leadership

Today, the Center is undergoing a transition, with the Center’s first director, Denise Naon, stepping down.  In looking back at the evolution of the Center, Naon is particularly proud of its contribution to raising awareness of the employment needs of Israel’s most vulnerable.  “People knew that there were challenges, but we were able to quantify them, characterize them, and clarify the factors influencing these challenges, and thus inform the development of new policies and programs,” she said.

As the new director Dr. Nir Levy takes over, the Center is increasingly focused on what might be called the “new agenda” for employment policy and services in Israel.  This includes:

  • the shift from job placement to job advancement
  • a growing interest in apprenticeship as a model of vocational trainin
  • the operation of national networks of employment centers that integrate a range of services and employment tracks.

The Center’s work over the years has certainly contributed significantly to the development of a focus on hard data on outcomes as a basis for key policy and programmatic decisions.  More recently, it has been promoting the use of cost-benefit analysis as well as the development of a set of shared outcomes indicators for evaluating employment programs, with the cooperation of all of the key Ministries and JDC-TEVET.  These shared measures will enable the Center to better compare outcomes across programs and enhance the learning process.

For Levy, it is exciting to become director at a time when the landscape is shifting.  “We’ve learned a lot about what works over the years, and are applying that knowledge.  At the same time, we are constantly striving to help identify new directions to develop and promote better employment solutions and to learn how to best implement them.”