A self-propelled irrigation machine in operation in the Negev Desert
Courtesy Embassy of Israel, Washington

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Growing tomatoes under plastic near the Sea of Galilee
Courtesy Embassy of Israel, Washington

In the 1950s and 1960s, through a state effort to absorb the large number of immigrant children into the public school system, the government assured itself of a future supply of educated workers. The demand for more educated workers was provided by the rapid expansion of public services, which are inherently humancapital intensive. Growth in public services resulted from the rapid and sustained economic growth that lasted until the early 1970s, and from the high rate of population growth.

In the 1970s, the education level of the labor force continued to rise markedly. Unlike the experience of other Western economies, the increased supply of educated workers in Israel did not, on average, depress the relative wage level of those with more schooling nor did it markedly worsen the employment condition of more educated workers as compared with workers with a secondary education. The continued increase in demand for education-intensive services and for more sophisticated goods and services generally have so far precluded the negative effects experienced in other countries. The widespread high level of human capital is expected to continue into the twenty-first century as long as investment in education continues to be profitable.

Data as of December 1988