The independent Arabs in Israel

In the years 2021-2006, the percentage of Arabs among all active self-employed people in Israel increased from approximately 15% to approximately 18%. This percentage continued to increase even after the outbreak of the Corona crisis, slightly offsetting the sharp damage to Arab employment resulting from the crisis. • The current proportion of Arabs among the total self-employed is greater than the total employed in the economy (13%), but still less than their share in the population (21%). • Also, self-employment is less common in Arab society: only about 8.4% of all employed Arabs in 2019 were self-employed, compared to a rate twice as high in Jewish society. • A sectoral examination reveals that the Arabs increased their share the most in the sectors in which the total number of self-employed people grew the slowest and among them: transportation, trade, industry, and hospitality and food. That is, the increase in the share of Arabs is supported by the decrease in the activity of self-employed non-Arabs in the same industries. • On the other hand, the share of the independent Arabs remained almost unchanged in the high-tech service industries: the information and communication industry, which in recent years has been increasing its share of GDP considerably, and the professional, scientific and technical services industry. • The geographical distribution of the Arab independents is similar to the distribution of the Arab population in Israel. Therefore, the self-employed Arabs make up the majority of all the self-employed in the northern district, while in the Tel Aviv district the share of the Arab self-employed amounts to only 3.1% (of the self-employed in the Tel Aviv district). are lower compared to their Jewish counterparts. The gap opened already in the second year of activity, and at the end of 15 years from the establishment of the business (year 2021) only 8.22% of the Arab independents survived compared to 8.26% of the Jewish independents. • There is a close relationship between the survival rates of the self-employed and the economic sector in which they operate. For example, in the health, welfare and relief services sector, the survival percentages after 15 years of Jews and Arabs are higher than 40%, while in the hospitality and food services sector, the survival percentages reach only about 10%. • At the same time, the differences in survival rates between Arabs and Jews are not uniform across the different industries. The survival percentages of Arabs are particularly high in the professional, scientific and technical services sector, but considerably lower compared to Jews in the agricultural sector. • The gap in survival rates between Arabs and Jews is the largest in the Tel Aviv District, while the North District is the only one where the Arabs’ survival rates do not fall below those of the Jews. • No support was found for the disparity in survival rates between Arabs and Jews reflecting a tendency of the self-employed Arabs to engage in more dangerous industries or districts.

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