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Israel raised the minimum wage by 6% effective as of Tuesday by special order of Labor Minister Yoav Ben-Tzur. Monthly pay will begin at NIS 6,247, ($1686.46) and the hourly rate will begin at NIS 34.32 ($9.26). This is the highest increase to the minimum wage in Israel's history.
After minimum wages were not increased in the five years between 2018 and 2023, the government agreed on phased increase the culminated with the current adjustment.
The decision came despite the Finance Ministry's position that there should not be an increase to the minimum wage under the current economic conditions and while the government was working to reduce the deficit caused during the war.
Although the new wages would be welcomed by low income earners, they are bad news for employers and for hundreds of thousands of Israelis who require the assistance of caregivers. Past increases in minimum wages have also resulted in higher costs for products and services.
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Economists war that the higher wages would contribute to a rise in inflation in April, alongside the seasonal increase and the 33% spike in transportation, higher food prices and a 1.4% increase in the price of water expected in May.
Ben-Tzur said in a statement that raising the minimum wage ahead of the Passover holiday is welcomed news for many who work hard for their wages. "I call of employers to follow the law and take care of the rights of their workers."