Manufacturers Blame Layoffs on Strong Shekel

Announcements in recent days of two plant closings and layoffs were cited by Manufacturers Association of Israel president Shraga Brosh as evidence of the damage the strong shekel is causing the economy, Globes reported on Monday.

The two plants, both in Kiryat Gat, are owned by Visonic, which manufactures wireless home security products, and Sugat, a large sugar company. Some 450 people will be made jobless by Visonic’s decision to move its operations to China; and another 60 will be laid off by Sugat at its sugar refining facility as it shifts to importing sugar from Europe.

The layoffs will be partially offset by Osem, which said on Monday that it stands ready to hire 80 workers for its plant in its new Kiryat Gat plant, to be making more of its popular Bamba snack, and due to open next year.

Brosh warned that these layoffs are merely the first of a wave of unemployment caused by the unrestrained strengthening of the shekel.”Other factories will soon close and there will be a large wave of layoffs in the economy,” he predicted.

Brosh contends that Israeli industry has lost its competitive edge as a result of the strong shekel and that this is “exposing Israeli industry to danger, and it will not survive for very long if the dollar exchange rate does not weaken.”

He once again urged Bank of Israel Governor Dr. Karnit Flug and Minister of Finance Moshe Kahlon to use every tool they have to stem the surge of the shekel.