Consequences of the High-Tech Evolution on the Israeli Society and Economy

The values of the traditional Israeli economy (collectives, hierarchy, social security, political support) appear to have been diminished in response to market forces, particularly American market forces. ^[3] A new elite has appeared in Israel, composed of high-tech entrepreneurs, employees , investors, and executives, and this has brought about a social revolution.

It can be argued that all those changes have influenced Israeli culture, but the high-tech sector is concentrated in a 30-km area around Tel Aviv called Kiriat Atidim, and in a small area of Haifa. These enclaves have one of the highest GNP per capita in the world and its population is fully Americanized: working between Kiriat Atidim and the U.S. can be seamless.

For many Israelis these changes are reshaping not only the economic landscape but also the whole of Israeli society. The digital divide is producing economic schisms in a society that was once proudly egalitarian. Most of the wealth is going to a small percentage of the population. Around 100,000 people work in high-tech in Israel and a one-third of them are highly paid, while in the rest of the economy the wages are stagnant and with the economic downturn, the unemployment rate in Israel is hovering at 10%.