By Emmanuel Farajun, Tel Aviv, July 1979. Originally published in Hebrew by The Israeli Socialist Organization (MATZPEN) in “Dapim Adumim” (“Red Pages”), no 5, May 1978.


Palestinian Workers, A Reserve Army of Labour in the Israeli Economy

Chapter-1: The Arab working class

A quick glance at the numerical proportions of the two nationalities in Israel, i.e. the Israeli-Jewish and the Palestinian-Arab, is enough to show one the important role the latter plays, far outweighing its size in the population. Within the “green line”, the Arab age median is 15 as opposed to the Jewish one of 22. This results, among other things, from the fact that 9 per cent of the Jews are beyond pensionable age (65+), almost three times as many as the Arab number: 3.4 per cent. This age structure means that though the proportion of the two populations is three million Jews to half a million Arabs, i.e. 6:1, the annual population (age 20-65) increase is 3:1. In other words: in the last few years the Jewish population in this age group has increased by about 24,000 per year and the Arab population by about 9,000.1 This high proportion of potential increase in Arab labour power is less surprising if we re­member that in spite of Jewish immigration, the overall growth ratio of the Arab population (4 per cent per year) is twice that of the Jewish population (2 per cent per year). Every year there are an additional 60,000 Jews, as opposed to 20,000 Arabs. Already Arab children between the ages of 1 and 10 make up a third of the number of Jewish children.2

To sum up then, whereas the Arab population is a sixth the size of the Jewish population in Israel, Arab labour potential (Israeli citizens only) constitutes a third of that of Jewish labour potential, i.e. with every three Jews added to the labour force pool, one Arab is also added. These figures are underlined by some deeper factors. Examining Arab youth labour, we will see that 37 per cent of Arab boys between 14 and 17 are actually working or seeking em­ployment, as opposed to only 23 per cent of Israeli youths.3 Moreover, secondary education plays a more important role among Jews than among Arabs. This, of course, is the result of a deliberate policy. This policy was revealed long before the famous “Kenig report” by the serving-adviser to the Prime Minister on Arab affairs’, Uri Lubrani, who wrote in Ha’aretz:

“It might have been better if there were no Arab students. Had they stayed woodsplitters and waterboys it might have been easier to govern them. But there are things beyond our control. We cannot avoid the problem. What we have to do now is know how to localise it.”4

This approach manifests itself in the token support the government gives Arab education and the local Arab authorities – a support which is totally out of proportion to their numbers. The results in secondary education can be measured, for instance, in the number of secondary school teachers: 1,800 in the Arab sector as opposed to 24,500 in the Jewish sector, i.e. less than 7 per cent of all the teachers in Israel are working in the Arab sector, although its student population constitutes 20 per cent of the total secondary school population.

But Arab workers residing in Israel constitute only half of the number of Arabs working in Israel. The other half comes from the occupied territories (the West Bank and the Gaza Strip) and several hundreds even come from Lebanon. There are also workers from East Jerusalem, which is officially annexed to the State of Israel and appears in most official statistical publi­cations as part of Israel. Together with the East Jerusalem workers, there were about 540,000 Arabs in Israel in 1978, some 110,000 of whom were part of the labour force, according to official figures. These figures do not accurately reflect the true picture, though, for several reasons: the figures are based on surveys and questionnaires and obviously not everyone re­ports his work – in order to avoid income tax. Also it seems that only a small part of the fe­male Arab work force is included in these statistics, according to which only the 10,000 Arab women residing in Israel are included in the labour force. In fact, thousands of women do do­mestic and agricultural work and are employed by labour contractors in small village spinning workshops and in seasonal harvesting – and undoubtedly a large number of them do not appear in the official statistics. This statistical distortion occurs to the same extent regarding Jewish labour and if we ignore it, we probably won’t harm the comprehensibility of the numerical proportion between the two nationalities very much.

(Note: among the Jews, the self employed are the black marketeers whereas among the Arabs it is the workers who are employed by black market employers.)

On the other hand we cannot accept the official figures of Arab labour from the occupied territories. The figures for 1977 are as follows:5

in ‘000
Population (over 14)
Labour Force
Working in Israel
All territories
West Bank
Gaza Strip + Sinai


These figures were calculated from answers to representative questionnaires given to some 2,000 family units in the West Bank and the Gaza Strip. They do not reflect the actual situation since only a few employers accurately report the number of workers from the occupied terri­tories working for them. The reasons are many: the law against spending the night in Israeli territory, income tax and insurance for the workers, etc.

Hanokh Smith, the official statistician and director of the authority for manpower planning, reports vis-a-vis the workers from the occupied territories in the Be’er Sheva region: “There are about 5,000 workers from Judea and Samaria according to official data”. In fact, the real figure is at least double.6 The Tel Aviv police commander said late in 1977 that 70,000 workers arrive every day from the occupied territories to Tel Aviv alone.7

The Ministry of labour itself reports8 that it has in its possession a card index of 150,000 workers from the West Bank and the Gaza Strip who have worked at one time or another in Israel. These workers have been employed officially, of course, i.e. through the labour exchanges. This figure does not tally at all with the overall official figure of the labour force of the occupied territories, i.e. 203,000, even if we take into consideration that these are accumulative records ranging over 10 years of occupation. According to the same report, approximately 60,000 workers from the occupied territories are registered and work through the labour exchanges.9 The labour exchange of the Gaza Strip and north Sinai, for example, reports a constant drop in the number of workers registering with it. Among the rea­sons given is the delay in the payment of wages and the possibility of getting a job through private contractors who pay on the spot. It also seems that official salaries paid through the labour exchanges are lower than those paid on the open market. They are also tax deductible, pensionable and subject to all sorts of other deductions which Gaza Strip workers would rather not pay, since there is no guarantee they would get anything in return for them when they reach retirement age.

The following is a sample of the Gaza Strip labour exchange records during the last few years:10

in ‘000
Registered Labourers


There is a sharp decline, even during the economic boom years 1969-73, in which there was an enormous increase in the number of workers from the occupied territories working in Israel. According to the same Ministry of Labour report for every 5 organised workers, there are 4 other unofficial workers.

All the above shows that without a doubt the number of workers from the occupied territories working in Israel averages around 100,000 a year; averaging higher during the busy seasons in agriculture and in construction, lower during other seasons. In other words, the total num­ber of Arabs employed in the Israeli economy is about 210,000 men and women, or some 17 per cent of the total Israeli labour force.

The importance of this labour force is shown by the fact that the ratio of participation in the civil labour force, (i.e. the percentage of the employed and the persons seeking employ­ment) of the Israel population is one of the lowest in the world. In Israel this ratio is 33 per cent. By comparison: the percentage of the labourers in England is 46 per cent, in Switzerland – 48 per cent, in Holland – 38 per cent, in Hong Kong – 45 per cent, in Japan – 54 per cent and in Rumania – 54 per cent. Israel, on the other hand, is in the same category as countries like India – 33 per cent and the Sudan – 29 per cent. Such a small ratio in an in­dustrial country like Israel is a result, first of all, of statistical fraud which is in turn a result of a black market economy and of a large standing army, which swallows huge quantities of labour power. Another problem of the Israeli economy is the relatively low proportion of manpower working in agriculture, construction and production, in comparison with other in­dustrial countries.

The accelerated development of the Israeli economic infrastructure and the large capital in­vestments during the years 1967-1973 would never have materialised without Arab labour, and particularly the workers from the occupied territories. As the 1976 Annual Bank of Israel Re­port concludes on the role of Arab labour from the occupied territories:

“The workers from the occupied territories, who entered the Israeli economy in great numbers until 1974, have been excluded from it to some extent over the past two years. The economic boom in the Arab coun­tries and in the occupied territories themselves to some extent accounts for this exclusion. But in spite of attractions outside the Israeli economy, the most important determinant in whether they are employed or excluded, is the Israeli demand for these workers. This is apparent in the development of various areas of employment: the fast slump in the construction industry excluded about 6,000 Arab workers from the occupied territories whereas in industry and in the services, the number of workers from the territories has in fact increased, in direct proportion to the increase in export and tourism.

“These workers, whose wages are lower than those of Israeli workers, and whose real as well as relative wages have decreased in 1976, have taken over some manual jobs almost completely ­in construction, in agriculture and in the service industries (including hotels, which have had an increased number of guests this year). The slowing down of the Israeli economy has not yet unduly harmed them beyond their unavoidable concentration in certain sectors (like con­struction), since competition on the part of Israelis is diminishing constantly both because of the rise in the level of education within the Israeli labour force and because family allowances paid to Israeli families cancel the drive towards manual jobs, the wages for which are low and getting even lower.

“There is a difference between the inhabitants of Judea and Samaria and the inhabitants of the Gaza Strip working in Israel. The first find it easier to get work in the Arab countries and their numbers in the Israeli economy have decreased over the last two years. Their places have been filled by workers from the Gaza Strip whose number have increased in 1976 in the sectors.”11

This report touches on the three most important determinants of the Arab labour force: firstly, its absolute dependence on the market. (We shall deal with this in the chapter on the mobility of the Arab labour force.) Secondly, its concentration in certain sectors, though, as we shall see in the chapter on branch distribution, it does not limit itself to manual work only. Thirdly, the low price of this labour force, with which we shall deal in the chapter on Arab workers’ wage structures.

Continue to… Chapter-2: The division of the Arab labour force between occupations and enterprises


  1. Israel Statistical Annual, 1977
  2. ibid
  3. Ministry of Labour Report, 1975 (Youth employment)
  4. Ha’aretz, 4.4.1961
  5. Riv’on Statisti La’shtahim” (“Statistical Quarterly for the Occupied Territories”), vol 7, No.1
  6. Hanoch Smith, “Koah Ha’adam beIsrael” (“Israeli manpower”) – Annual report
  7. Ya’ir Kottler, opp.cit.
  8. Ministry of Labour, Administered Area Unit. Report on Activities, Aug. 1976
  9. ibid, p. 13
  10. Ministry of Labour, Report on activities, Gaza Strip, 1975-76
  11. Bank of Israel, Annual Report, 1976. p. 219