The Absorption of Soviet Immigrants into the Labour Market

Since late 1989, when the new wave of immigration from the FSU to Israel started, nearly 600,000 immigrants have come to Israel, an addition of almost 11 per cent to the population of the country. ¹ At present (mid-1995), the annual immigration rate stands at 50–70,000. This is an almost unprecedented volume, even for Israel, a country of permanent immigration. What was initially seen as an immigrant absorption problem, with only marginal effect on the economy, has become a challenge requiring substantial structural changes in the Israeli economy, which will affect the direction of future economic development. The absorption problem has emerged as an overriding endogenous factor, which will influence many aspects of Israel’s economic policy making for years to come. ^*