Salary and Compensation

While everyone is striving to find a job that is satisfying and matches their lifestyle, at some level, compensation is a critical component in the decision-making process. The difficulty in addressing this issue generally is that everyone wants to answer the simple question: "What is the correct compensation for me for this job?". Yet, not all simple questions have easy answers, and this is a case in point.

The reason that there is not always a straightforward answer to this question is actually not related to Israel itself, but rather to the nature of the global employment market, of which Israel is simply a small member.

In such an environment, the ability to predict salaries is no higher or lower than in any other country. However, for a new person entering the Israeli workforce, without history/knowledge of the compensation structure, and possibly lacking a network of experienced people in the country who can answer their questions, such uncertainly often causes a lack of confidence.

So, our purpose here is to present you with some guidelines to help you make more informed decisions.

A New Mindset

Of course, it is also important to remember that each country has a minimum wage and average salary. However, what is critical to you at the end is your salary, which may be quite different than the market indexes, depending upon profession, industry, and years of experience.

The mean average Israeli salary is currently in the region of 7900 Shekels (NIS/₪) per month. We are sure you already have your calculators out, and are quickly determining what these numbers translate to in your local currency. Don’t press that button!

One critical tip after deciding to make Aliyah is to stop making such comparisons, as natural as it may initially seem. Once you arrive in Israel, such calculations are counter-productive, and in most cases not relevant to your day-to-day financial situation here.

Salary is a portion of your income, and must be compared with your expenses. Since expenses in Israel will be different than they were before you arrived (and in many cases lower), then it is only relevant is to think in terms of shekels, and view your Israeli salary based on this perspective.

Standard working hours in Israel vary from 35 to 45 hours/week, including a lunch hour. Some employers may have contracts which include additional pay for overtime hours, while others are globali (a fixed salary without extra for overtime). Be sure to find out.

Written conditions of employment are required by law from the employer, yet unfortunately these are often not supplied.

A variety of benefits are found in the Israeli workplace. None of these are required, however the rule of thumb is that the higher the salary, the more likely that one or more benefits will be offered.

Some of the more common benefits include:

Pension - An obligatory employee sponsored pension fund is currently being discussed in the Knesset; for now it is optional.
Bituach Menahelim - insurance/retirement
Keren Hishtalmut - savings plan
Pitzuim – severance pay, sometimes paid to employee when leaving company independent of the reason
Company car
Lunches at subsidized rates

Fully combined, the company contribution can amount to more than 20% of your base salary.

Standard deductions include Bituach Leumi (National Insurance), Kupat Holim (health insurance), and the employee portion of saving plans when relevant.

Salary Comparisons

In terms of salaries, as is true with all countries, for any particular position there is a wide range of salaries that may be considered normal. The reason for the large range is usually related to the experience of the employee, the company, the industry, and the compensation philosophy of the company.

Keep in mind that salary surveys, whether posted on the internet or found in other mediums, are often not representative of the market overall, and quite likely not to you in particular. Thus, while you can use them as one piece of information, it is important not to place too much emphasis on them.

Talking to people that you know in the industry in Israel can be a much better indication of the current market conditions. If you don’t have relevant connections, we recommend that you use networking techniques to help you make the appropriate introductions.

Studies consistently indicate that although new immigrants may have salaries lower than non-immigrants, in many cases immigrants catch up. For English speakers in particular the situation is even more positive, as since English is strongly required in the Israeli marketplace, those that have a good command of the language can actually receive a premium.

Get Your First Job

The job search for a new immigrant is a unique situation, both from the perspective of the job seeker and from the employer. From the employee’s viewpoint, you are beginning work in a new country, trying to find your first job, and it is not always an easy process. On the other hand, the employer has to consider what additional risks are associated with hiring a person that has no employment history in Israel, and maybe no local references.

If you want to work out what your net salary will be based on a job offer where you know the bruto (gross) amount - try the following salary wizard will help you work out what you see in your pocket Hilan Salary Calculator

When so many variables exist, flexibility is the key to success. In many cases, the objective of a first job is to get initial Israeli work experience, improve your language skills, and meet people. Yes, compensation is important, but in the first job, it may not be the most significant factor. Sometimes the main goal when looking for a first job is to use it as a tool to ultimately secure a second job, the one that you really want.

Creative solutions such as one or part-time jobs and/or both adults working can go a long way towards meeting your financial obligations in Israel.  Although looking ahead, a job search in a new country is full of unknowns, with perseverance most people do succeed in entering the workforce and building careers.

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