Terrorism Surge Threatens Construction Industry

The ongoing surge in terrorist attacks may not disrupt the peace process, as some analysts say it is intended to do, but it could bring down the Israeli construction industry.

Building contractors are warning that further deterioration in the security situation could cause serious damage to the sector and the economy in general, Globes reports.

The reason for that is the large number of Palestinian workers at building sites. Full or partial closure of Palestinian areas in Yehudah and Shomron for security reasons could wreak havoc on construction schedules, as those workers are prevented from entering the country.

Currently, the sector employs about 28,000 Palestinian workers, compared with 5,000 from China and Europe.

“In view of the deterioration in the security situation, there is the possibility of a partial or full closure of Yehudah and Shomron for a long time and/or brief periods. A change of this kind in the daily routine of construction workers could cause a collapse of the construction industry, and building times could, with one blow, be greatly prolonged,” warned Israel Builders Association president Nissim Bublil in a letter to Prime Minister Binyamin Netanyahu, Minister of Finance Yair Lapid, Minister of Defense Moshe Yaalon, Minister of the Interior Gideon Saar, and Minister of Housing and Construction Uri Ariel.

“The sharp drop expected in the number of Palestinian workers is liable to greatly reduce the housing supply and worsen the current crisis. The government and the ministers responsible for the matter should prepare in time and take this likely scenario into account. To prepare accordingly and avoid a further deterioration in the housing market, causing an additional rise in prices, the government should immediately allow the import of a large number of foreign workers,” Bublil wrote.

The shortage of foreign workers has been a point of contention for some time, for other reasons, unrelated to security.

As Eldad Nitzan, chairman of the Association of Foreign Construction Workers Companies at the Federation of Israeli Chambers of Commerce noted: “The shortage of foreign workers is sending the labor cost of construction workers skyrocketing. Chinese construction workers are earning a net NIS 1,000 a day, averaging NIS 25,000 a month. These amounts are ultimately rolled over onto homebuyers.”

This article appeared in print on page 6 of the January 14th, 2014 edition of Hamodia.