Decline in industrial production raises a lot of concern in Israel, as the nation’s major share of economic support is from the industrial sector. A drastic fall has been recorded in production volumes in Israeli industries in the second half of 2016. Industrial production has been a key factor driving the economic growth of the nation in recent past.
The major reason behind the sluggishness can be pointed out toward the dip in technology and electronics related industries. The country has recorded a further drop in High-tech production during August to October 2016 post tumbling of the sector in the preceding three months. In addition, a moderate decline in overall industrial employment has been noticed recently in the country, having reduced the strength of salaried position including in the high-tech sector.
Likewise, the situation has also impacted the industrial export levels that have taken a hit, reflecting almost a 19% drop over the past few months majorly attributed to the slowdown in high-tech exports. Moreover, exports decline from other industries also made an impact but not as severe to that of High-Tech exports. Between August and October, the overall economy slumped worryingly without making any substantial recoveries. In 2015, the annual figures of exports based on business services were up to more than US$ 26 Billion, which was calculated at over $25 billion in the previous year. Exports from research and development based services accounted for nearly 72% share in 2015 and were estimated to worth more than US$ 3 Billion. Israel exported over US$13 billion worth high-tech services, accounting for close to 53% of the overall business service exports taking place in 2015. In terms of business service imports, Israel imported high-tech services worth over US$ 3 Billion.