Following the decision of the political-security cabinet to extend the mandatory service in the IDF to 36 months, economic experts warn of the significant economic consequences of the move.
Tens of thousands of ultra-Orthodox protest once morest the recruitment of Yeshiva members in Jerusalem June Rickner
Chen Herzog, the chief economist of the consulting firm BDO, explains that “the reservists are a central part of the productive routine of the Israeli economy. Their long absence from the workplace causes severe economic damage to the economy.”
According to Herzog, “the move to extend the regular service allows for savings of approximately NIS 5 billion per year compared to the expansion of the military service in a parallel way through reservists.” However, he emphasizes that “from an economic point of view, the extension of the regular service will be significantly more expensive compared to the alternative of expanding a base The recruitment through Haredim recruitment.”
Fresh recruits at the recruiting office (archive), photo: Koko
Herzog points out that “Conscripting the ultra-Orthodox into the army would have made it possible to increase the regular army without extending the mandatory service. Estimates conducted at the time by the Ministry of Finance showed that the conscription of the ultra-Orthodox might even shorten the military service by 7 months for all regular soldiers.”
The economist explains that “the economic cost of the regular soldiers, who have not yet acquired training and work experience, is lower than the cost of the reserves.” However, he warns that the extension of the regular service might lead to a significant loss of revenue for the economy in the long run.
He also added that “the decision to extend the mandatory service postpones the date of integration of the regular soldiers into the labor market, thus creating a heavy cost for the regular soldiers and the economy as a whole. The right solution from an economic point of view is to expand the recruitment base, which, beyond its importance to the issue of equality in the burden, also produces a high economic benefit, because instead of delaying the integration of regular soldiers into work, it recruits ultra-Orthodox who are currently outside the workforce.’
Those who do not come to the recruitment office, who will not come to the polls either, photo: Koko
The cabinet’s decision to extend the mandatory service comes once morest the background of the continuation of the Iron Swords War and the need to increase the military force. However, public criticism of the sweeping exemption from conscription for Yeshiva members continues to resonate, with experts such as Herzog pointing to the potential economic benefits of broadening the conscription base.
It remains to be seen how the extension of the service will affect the Israeli economy in the long term, and if additional steps will be taken to deal with the economic and security challenges facing the country.
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