Israel's Population Growth Slows Amid Economic Challenges and War

Israel's population has seen a modest increase of 1.1% over the past year, reaching just over 10.027 million, as reported by the Central Bureau of Statistics. This marks a decline from the 1.6% growth in 2023 and represents the first dip in population growth since 2020, during the Covid-19 pandemic.

One of the main factors contributing to this slowdown is a rise in emigration, with 82,700 Israelis leaving the country in 2024. Immigration also saw a decline, with 32,800 Jews immigrating to Israel—a drop of 33% compared to 2023, likely due to the ongoing war and economic uncertainties. Despite these challenges, 23,800 Israelis who had been living abroad returned home.

The breakdown of Israel's population shows that 7.707 million (76.9%) are Jewish, while 2.1 million (21%) are Arab. The country's natural population growth, primarily driven by births, saw 181,000 babies born during the year, contributing to a total population increase of 112,000 after factoring in net emigration.

While the number of deaths has risen sharply since October 7, 2023, due to the ongoing conflict, it has not yet reached the levels seen during the Covid pandemic.

Economic Outlook: The Shekel and Dollar Dynamics

On the economic front, 2024 has been a year of mixed fortunes. Despite the global economic challenges, including geopolitical instability and the ongoing war, Israel's shekel has performed relatively well. The US dollar had its strongest year since 2015, gaining over 7% against major currencies. However, the shekel has managed to maintain parity with the dollar, even recovering from a low point in the weeks following October 7, when the shekel-dollar rate reached NIS 4.08/$ before stabilizing at NIS 3.627/$ by the end of 2023.

The shekel has also outperformed most major currencies. It appreciated against the euro, opening the year at NIS 4.074/€ and closing at NIS 3.796/€, and showed a slight strengthening against the British pound, closing the year at NIS 4.574/£, up from NIS 4.621/£ at the start of 2024.