National Insurance report - Every 5th Israeli was poor in 2021: 1.95 million half of them children

In 2021, 1.95 million poor people lived in Israel, including 853.8 thousand children and 212.4 thousand people of retirement age. This is according to the National Insurance data, as part of the annual poverty report published on Thursday morning. The report shows that in Israel every fifth person is defined as poor.
  This is an increase compared to 2020, when there were 1,877,594 people below the poverty line in Israel, but this increase was mainly caused by the increase in the "poverty line" itself, and this is due to the increase in the standard of living after the first difficult year of the Corona virus. However, many in Israel are still left behind.
According to the National Insurance, in 2021 the median net income per standard capita, from which the poverty line is also derived, increased by a moderate rate of 1.3%, reaching NIS 2,849. In contrast, the median economic income per standard capita, which does not take into account the government's intervention through taxes and transfer payments, increased by a sharp rate of 7.9%.
According to the calculations of the National Insurance, a single person would need NIS 3,561 a month in 2021 to be above the poverty line, while a family of a couple with a child or an independent parent with two children needs an income of NIS 7,550 a month. A family of a couple with two children will need an amount of approximately NIS 9,117 to be above the poverty line.
The National Insurance says that the relatively moderate increases in the dimensions of poverty in 2021, despite the cessation of most of the special supports granted during the Corona period, starting in the middle of the year, reflect the impressive recovery in the labor market, including the increase in employment.
According to the report, without government intervention, that is, according to economic income, the incidence of poverty for families decreased from 37.4% to 35.5%, for individuals decreased from 33.9% to 32.1%, and for children decreased from 39.0% to 37.0%. These decreases are attributed to the rapid recovery in the labor market in the year of the report.
The highest increase in the incidence of poverty was recorded among senior citizens: from 16.4% in 2020 to 17.6% in 2021, "this, in view of the cessation of the special grants given in 2020 on the one hand and their little participation in the labor market on the other," it said.
Jacob (76), who worked for 45 years in the education system, is an example of one of those senior citizens who barely keeps his head above water. "I was a teacher, and now I need people's donations. It humiliates me. I am a survivor," he says.
Together with his son, who is on the autistic spectrum, Jacob lives in a small public housing apartment, the rent of which recently increased from NIS 300 to NIS 1,600 per month. "I live on subsistence allowances from the National Insurance," he explains. "I can't pay such sums, if I pay it, we don't have food. I get a food package from Tahon Lev once a week, the rest of the time we try to make ends meet. I have health expenses that are difficult for me to pay, I haven't paid an electricity bill for two months. We don't have Not even an oven, so we don't heat the house. It's cold at this time, so we dress warmer and go to bed."
According to Nitsa (Kliner) Kasir, VP of Research and Planning at the National Insurance, "2021 was characterized by the return of the economy to a growth path, a path from which we deviated during the Corona crisis. Many workers who left the workforce during the crisis have returned to work. The unemployment rate, which at the height of the crisis was 35%, dropped to 5% in 2021, and an increase was recorded in the real wage.
"With the removal of the restrictions imposed during the pandemic and the improvement in the economic situation, the supports given to families and businesses during the crisis period have been reduced as of July 2021," Kasir explains. "The decrease in the amount of support was low compared to the contribution of the economic recovery on incomes, and therefore, despite this decrease, net incomes increased in almost all deciles. The effect on the different populations was not uniform, and net incomes increased slightly less in the lower deciles and in the second decile there was even a decrease. Thus, for the first time in years , the rates of poverty and inequality according to net income have increased."
The data of the report indicate that the poverty rates measured by net income increased slightly: the poverty rate of families increased by 0.4%, to 21%. The poverty rate of all persons increased from 20.5% to 21% and the poverty rate of children increased by 0.8% and reached 28%. As mentioned, the poverty rate of senior citizens increased at a higher rate - from 16.4% in 2020 to 17.6% in 2021.
The poverty incidence of working families remained almost unchanged and reflects opposite trends between employees and the self-employed: the poverty incidence of salaried families increased slightly, while the poverty incidence of self-employed families decreased from 13.4% to 12.1% between the two years.