The Subcommittee on Artificial Intelligence and Advanced Technologies, chaired by MK Orit Farkash Hacohen (National Unity Party), convened on Wednesday for a debate entitled “Artificial intelligence changing the labor market: Model and policy for prosperity in the era of AI." In the debate, forecasts were presented on the future of the labor market in Israel in light of the impact of artificial intelligence. Speakers said that the new tools could replace many jobs, mainly in fields such as customer service, sales and other technological occupations.
Subcommittee Chair MK Farkash Hacohen: “Today's debate shows that the challenge of labor, given the AI eruption, is not theoretical, it's already here. Many high-tech companies report that they are replacing workers, [including] programmers and technological professionals, with advanced AI tools. In other words, along with the fact that artificial intelligence will supplement and improve various professions, there will certainly be a replacement of workers and personnel here. I call upon the Government to take immediate action in order to cope with the upcoming changes, to prepare for the ramifications of use of artificial intelligence in all fields of work, and to prepare a work plan that will cover all the aspects."
Daniel Schreiber of the MOSAIC AI Policy Institute presented a national road map warning of significant repercussions of the artificial intelligence revolution on the labor market in Israel. The document, entitled “Road map from vision to policy: Policy recommendations for the prosperity of all of Israel's citizens in the AI era," stresses the urgent need for a national policy that will cope with the structural changes expected in the labor market. The document states that without proper preparation, the development of artificial intelligence could significantly harm Israel's economic and social resilience. MOSAIC calls upon the Government to adopt a proactive approach that will include constant monitoring of the effects of artificial intelligence on the Israeli labor market and economy, while ensuring a social safety net for workers who are adversely affected by the technological changes.
Another study, conducted by the Taub Center for Social Policy Studies in Israel, also presented worrying statistics regarding the effect of artificial intelligence on the Israeli labor market. The study, which was published recently, reveals that a worrying trend is already evident of an increase in the percentage of unemployed whose occupation has a high level of exposure to artificial intelligence, and a low “complementarity" level--in other words, professions in which there is a high risk that a human worker will be replaced by artificial intelligence technologies.
The study, based on data from a personnel survey, examined the effect of artificial intelligence on various occupations using two main indices: “Exposure to artificial intelligence," which measures the ability of large language models (LLMs) to surpass humans in tasks that are characteristic of the profession, and “complementarity," which reflects the essentialness of the human factor in the occupation (according to criteria such as face-to-face work, public speaking, accountability and manual labor).
The findings show that among unemployed, the percentage of workers who recently worked in an occupation that artificial intelligence is likely to replace is higher than among employed workers. Moreover, in the past year (2023–2024), a significant increase has been recorded in the rate of unemployed whose occupation is marked by high exposure to artificial intelligence and a low complementarity level.
The RISE Israel institute presented to the committee its positions and recommendations on the impact of AI on the labor market in Israel, and the need for immediate preparations by the state in light of the expected changes in the labor market. The institute's representatives said that the growing use of artificial intelligence technologies could pose a threat to the future of technological startups in Israel, and this will require training and adaptation programs. The institute recommended that the Government take immediate actions to gear for the effects of AI, while protecting the interests of the business and educational sectors in Israel and creating training programs that are suited to the future job market.
Artificial intelligence expert Dror Globerman said that the industry was already at the stage of transition to automation in service centers. “As of today, we have been updated that significant waves of layoffs are expected from support and customer service systems in the next month or two," Globerman said. “We're not talking about the distant future—the changes are already starting now, and this will continue to expand to additional fields in the coming years," he stated.
Ministry of Labor official Ifat Citroen said about the State of Israel that in terms of digital skills, reading literacy and mathematics, “We are, regrettably, holding ground or dropping. This challenge is particularly significant among certain populations, and the data shows that the achievements of the Arab population in Israel in international comparative tests are even lower. This is a clear challenge that we have identified, and it's important to prepare for it and see which measures are needed. There are professions that are disappearing, such as cashiers, secretaries and bank tellers; these are not just theoretical forecasts, studies or surveys such as those performed by the World Economic Forum. This decrease is already taking place, and we see the gradual disappearance of routine, repetitive professions."
Yosef Gdalyahu of the Ministry of Innovation, Science and Technology said that artificial intelligence was expected to have a significant effect on the labor market, including changes in the required skills, loss of jobs and new opportunities in the technological field. About 30% of the jobs in Israel could be affected by artificial intelligence, and about 25% of the jobs are expected to be replaced, he said.
Dr. Ella Shachar of the Bank of Israel Research Department said that she did not share the pessimistic forecasts presented in the debate. She said, “Despite the fact that the spread of artificial intelligence could lead to changes, the trend is not expected to be immediate. The contribution of artificial intelligence to work productivity is expected to be about 0.1% per year, meaning about 1% in the next decade. The trend will not necessarily lead to a significant loss of jobs in the short term, but the public sector must prepare for the changes that will arrive later on. In the coming month, the Bank of Israel will issue a comprehensive study that will address all the types of occupations in Israel and the ramifications."
Subcommittee Chair MK Farkash Hacohen: “Today's debate shows that the challenge of labor, given the AI eruption, is not theoretical, it's already here. Many high-tech companies report that they are replacing workers, [including] programmers and technological professionals, with advanced AI tools. In other words, along with the fact that artificial intelligence will supplement and improve various professions, there will certainly be a replacement of workers and personnel here. I call upon the Government to take immediate action in order to cope with the upcoming changes, to prepare for the ramifications of use of artificial intelligence in all fields of work, and to prepare a work plan that will cover all the aspects."
Daniel Schreiber of the MOSAIC AI Policy Institute presented a national road map warning of significant repercussions of the artificial intelligence revolution on the labor market in Israel. The document, entitled “Road map from vision to policy: Policy recommendations for the prosperity of all of Israel's citizens in the AI era," stresses the urgent need for a national policy that will cope with the structural changes expected in the labor market. The document states that without proper preparation, the development of artificial intelligence could significantly harm Israel's economic and social resilience. MOSAIC calls upon the Government to adopt a proactive approach that will include constant monitoring of the effects of artificial intelligence on the Israeli labor market and economy, while ensuring a social safety net for workers who are adversely affected by the technological changes.
Another study, conducted by the Taub Center for Social Policy Studies in Israel, also presented worrying statistics regarding the effect of artificial intelligence on the Israeli labor market. The study, which was published recently, reveals that a worrying trend is already evident of an increase in the percentage of unemployed whose occupation has a high level of exposure to artificial intelligence, and a low “complementarity" level--in other words, professions in which there is a high risk that a human worker will be replaced by artificial intelligence technologies.
The study, based on data from a personnel survey, examined the effect of artificial intelligence on various occupations using two main indices: “Exposure to artificial intelligence," which measures the ability of large language models (LLMs) to surpass humans in tasks that are characteristic of the profession, and “complementarity," which reflects the essentialness of the human factor in the occupation (according to criteria such as face-to-face work, public speaking, accountability and manual labor).
The findings show that among unemployed, the percentage of workers who recently worked in an occupation that artificial intelligence is likely to replace is higher than among employed workers. Moreover, in the past year (2023–2024), a significant increase has been recorded in the rate of unemployed whose occupation is marked by high exposure to artificial intelligence and a low complementarity level.
The RISE Israel institute presented to the committee its positions and recommendations on the impact of AI on the labor market in Israel, and the need for immediate preparations by the state in light of the expected changes in the labor market. The institute's representatives said that the growing use of artificial intelligence technologies could pose a threat to the future of technological startups in Israel, and this will require training and adaptation programs. The institute recommended that the Government take immediate actions to gear for the effects of AI, while protecting the interests of the business and educational sectors in Israel and creating training programs that are suited to the future job market.
Artificial intelligence expert Dror Globerman said that the industry was already at the stage of transition to automation in service centers. “As of today, we have been updated that significant waves of layoffs are expected from support and customer service systems in the next month or two," Globerman said. “We're not talking about the distant future—the changes are already starting now, and this will continue to expand to additional fields in the coming years," he stated.
Ministry of Labor official Ifat Citroen said about the State of Israel that in terms of digital skills, reading literacy and mathematics, “We are, regrettably, holding ground or dropping. This challenge is particularly significant among certain populations, and the data shows that the achievements of the Arab population in Israel in international comparative tests are even lower. This is a clear challenge that we have identified, and it's important to prepare for it and see which measures are needed. There are professions that are disappearing, such as cashiers, secretaries and bank tellers; these are not just theoretical forecasts, studies or surveys such as those performed by the World Economic Forum. This decrease is already taking place, and we see the gradual disappearance of routine, repetitive professions."
Yosef Gdalyahu of the Ministry of Innovation, Science and Technology said that artificial intelligence was expected to have a significant effect on the labor market, including changes in the required skills, loss of jobs and new opportunities in the technological field. About 30% of the jobs in Israel could be affected by artificial intelligence, and about 25% of the jobs are expected to be replaced, he said.
Dr. Ella Shachar of the Bank of Israel Research Department said that she did not share the pessimistic forecasts presented in the debate. She said, “Despite the fact that the spread of artificial intelligence could lead to changes, the trend is not expected to be immediate. The contribution of artificial intelligence to work productivity is expected to be about 0.1% per year, meaning about 1% in the next decade. The trend will not necessarily lead to a significant loss of jobs in the short term, but the public sector must prepare for the changes that will arrive later on. In the coming month, the Bank of Israel will issue a comprehensive study that will address all the types of occupations in Israel and the ramifications."