Arab families are greatly over-represented among Israel’s poor: over half of Arab families in Israel are classified as poor, compared to an average poverty rate of one-fifth among all families in Israel. Arab towns and villages are heavily over-represented in the lowest socio-economic rankings, and the unrecognized Arab Bedouin villages in the Naqab are the poorest communities in the state
Gaps in income and poverty rates are directly related to institutional discrimination against Arab citizens in Israel.
Although the right to equality demands that states take positive steps to bridge the gaps between the various population groups, the State of Israel actively seeks to promote and direct resources to Jewish citizens as a privileged majority within the “Jewish State”. In many policy areas, including the designation of “National Priority Areas” and the use of the military-service criterion to allocate resources, the state actively preserves and perpetuates inequalities between Arab and Jewish citizens of Israel.
The state has consistently failed to take adequate and effective action to address the phenomenon of absolute and relative poverty among the Arab minority in Israel. Where it has initiated development programs targeting the Arab minority, such as the “Multi-Year Plan”, the state has tended to implement them partially, gradually, or not at all.
Direct state policy measures to reduce poverty disproportionately target Jewish citizens, with the result that poverty rates have fallen far more sharply among Jewish citizens than among their Arab counterparts, and inequalities have consequently persisted.
Palestinian citizens of Israel often face discrimination in work opportunities, pay and conditions, both because of the inadequate implementation of equal-opportunity legislation and because of entrenched structural barriers, which particularly affect women, and include poor or non-existent public transportation, a lack of industrial zones, and a shortage of state-run daycare centers. Palestinian citizens are also excluded from the labor force by the use of the military-service criterion as a condition for acceptance for employment, often when there is no connection between the nature of the work and military experience.
Unemployment rates remain significantly higher among Arab than among Jewish citizens, and the rate of labor-force participation among Palestinian women citizens of Israel, at just about 20%, is among the lowest in the world.
Palestinian citizens of Israel in general, and women in particular, continue to be sorely underrepresented in the civil service, the largest employer in Israel (in total, Arabs constitute just around 6% of all civil service employees), despite affirmative-action legislation stipulating fair representation for the Arab minority and for women.
The lack of development and investment in Arab towns and villages inside Israel and the unexploited or under-exploited human resources of the members of the Palestinian minority inhibit the growth of the Israeli economy. The lost potential to Israel’s economy has been estimated at around US$ 8 billion per year by the Organisation for Economic Cooperation and Development (OECD).