As Tech Jobs Go Unfilled, Israel Looks to Hire More Arabs

Joseph Karkaby, a 24-year-old Israeli Arab, was chosen for a government-subsidized internship while still in college because his grades were so good.

Yet he received no replies to the hundreds of resumes he sent out after graduation -- until he removed references to his background, including changing his hometown from the Arab village of Shfaram to the mostly Jewish city of Haifa.

“In three weeks I had three contracts to choose from,” said Karkaby, whose Arab origins soon became clear in face-to-face interviews.

Only one in five of Israeli Arabs with a computer science degree works in the field, and a new government program is trying to change that. As part of a push to add 300,000 jobs in the Israeli Arab sector by 2020, the Ministry of Economy has budgeted more than 40 million shekels ($10.5 million) over the next three years to integrate one of the country’s fastest-growing populations into its most promising industry.

“We see employment as a very important component in economic growth and in closing social gaps,” said Michal Tzuk, the ministry official in charge of employment programs.

A growing shortage of technology workers is making the integration of Israeli Arabs, who account for a fifth of Israel’s 8.2 million people, even more urgent. About 7,000 new jobs are created annually while there are fewer than 5,000 graduates to fill them, the Economy Ministry said. Despite this scarcity, about 40 percent of Israeli Arab technology graduates end up teaching instead of working in the field, according to Tsofen, a non-governmental Arab-Jewish organization whose goal is to integrate Israeli Arabs into the tech world.

Outside Circle

Israeli Arabs face a series of handicaps when chasing the kinds of jobs Karkaby found first at Comverse, a maker of telecommunications business technology, and then at Galil Software, established to bring Arabs into the tech industry. Because most are exempt from the draft, they don’t belong to the inner circle of veterans of elite military technology units and are unknown to recruiters. Some Israeli Arabs say they suffer from discrimination. A further burden is that most technology jobs are in the Tel Aviv area, a 90-minute drive from the north, where the majority of Israeli Arabs live.

Amnon Be’eri-Sulitzeanu, co-executive director of the Abraham Fund Initiatives, a group that promotes Jewish-Arab coexistence in Israel, said the government was moving in the right direction. At the same time, “there is a lot more to be done,” including a push to have the industry “break out, diversify and not rely only on the army as a source for human resources,” he said.

Slowest Pace

Technology makes up about 40 percent of Israeli industrial exports, while sales abroad account for about a third of gross domestic product. A 2009 book by Dan Senor and Saul Singer dubbed Israel “Start-Up Nation” for its technology entrepreneurship. The push to bring more Israeli Arabs into technology companies comes at a time when the economy is growing at its slowest pace since 2009.

“Only 10 percent of the Israeli workforce is in high tech and I’d like it to be 20 percent,” said Chief Scientist Avi Hasson. “One way to do this is to expand and bring in the Israeli Arabs as well as the ultra-Orthodox. This is the challenge and I am not underestimating the difficulties.”

Tsofen says only 350 Arab engineers worked in technology six years ago. Now about 2,000 do, accounting for about 2 percent of technology workers, it says.

“What we are doing is giving hope,” said Sami Saadi, co-founder of Tsofen. “The government didn’t invest in the Arab community for 60 years.”

Greater Poverty

More than half of Israeli Arabs live in poverty, compared with 19 percent of Jews, according to Tsofen. The average monthly salary for Arabs is 7,590 shekels, compared with 13,246 for Jews, it said.

The sum the government has earmarked for the technology jobs program is part of a total 1.2 billion shekels allotted to encourage Arab employment. The International Monetary Fund cautioned in February that the Israeli economy will slow significantly unless Israeli Arabs and ultra-Orthodox Jews are integrated into the workforce.

“High tech drives Israel’s economy,” said Smadar Nehab, Tsofen’s chief executive. “It is impossible to think that 20 percent of the population isn’t part of it.”

The opening of a high technology center in Nazareth, the biggest Arab city in Israel, is a sign things are moving. Amdocs Ltd, a maker of billing software, has a branch there and employs about 200 people, 85 percent of them Arabs, according to Tsofen. An incubator partially financed by the Economy Ministry is just steps from the Basilica of the Annunciation in the city.

Role Models

For Arab women in particular, proximity to the home is important, so Nazareth offers a good option. Tsofen, which runs a training program designed to give Arabs the workplace experience Jews get in the army, says it has placed 80 percent of its 350 graduates in jobs.

The Economy Ministry is subsidizing Arab employment in the technology sector, while the chief scientist’s office is offering Arab-run startups 85 percent funding, compared with as much as 50 percent for Jewish-founded peers. “Innovation likes heterogeneity,” said Hasson, the chief scientist. “The more role models there are, the better it will be.”

Ameen Abu Leil, a 24-year-old team leader at Galil Software, said his parents didn’t talk to him for two weeks after he said he wanted to study computer science.

“They wanted me to study medicine because this was the only job for intelligent Arabs to find a job in,” he said. Upon graduating from the Technion-Israel Institute of Technology in Haifa, Abu Leil sent out 1,115 resumes, he said. No one responded. “I was very upset,” he said. “For the first time in my life, my dad was right.”

Then a friend asked him to meet a potential Galil client to persuade him Israeli Arabs could do the project as well as Jews.

“It took half an hour to convince them that we talk the talk and walk the walk, that we know the material,” he said.

Today, he’s vice president of customer projects at Galil.

Before it's here, it's on the Bloomberg Terminal.