MKs' Hard Times: $8,640 a Month

The recession has hit the Knesset. The House Committee ruled Tuesday that MKs will have to make do on wages of NIS 33,259 ($8,640) a month. The average salary in Israel, for those who have not been the victims of layoffs, is approximately NIS 8,000 ($2,078) a month.

The House Committee ruled against an automatic raise of NIS 997 ($259) a month for the legislators. "It's important that the Knesset set an example to the public during these hard times," said Likud MK Reuven Rivlin."

In addition to the monthly check, which is about 20 percent less than a minimum wage worker earns the entire year, MKs receive a car, telephone and mail privileges, all funded by taxpayers.

Most private sectors are facing wage cuts and job cuts as the winds of worldwide financial recession howl in Israel. The number of those looking for work rose by more than two percent in November, and the number of out-of-work university graduates has reached a five-year high.

High-tech layoffs are expected to reach 8,000, and two giant chemical companies have suspended operations. Haifa Chemicals and Israel Chemicals have shut down their Rotem operations near Arad for two weeks to a month, leaving thousands of employees out of work.

Analysts expect the current unemployment rate to rise from the current 6.1 percent to 8 percent next year.

Finance Minister Ronnie Bar-On (Kadima) has come up with a plan to keep down a politically damaging high unemployment rate by proposing that employers rotate unpaid leaves-of absence for three months at a time, keeping more people on the permanent payroll while they are unemployed for several weeks. The government would pay 70 percent of their wages, according to the Finance Ministry plan.