About two million Israelis or 21 percent of the population, including roughly 900,000 children, are living below the poverty line, according to the National Insurance Institute’s (NII) 2024 poverty report published on Friday, January 30. The war in Gaza, which began months earlier with the October 7 war contributed to the rising poverty levels in Israel, according to the annual NII report.

Volunteers hand out food packages to elderly people in southern Tel Aviv, Bat Yam and Rishon LeZion, June 2025 (Photo: Latet)

Some 27.8% of households cannot meet all monthly expenses. About 9% forgo medical treatment due to financial hardship, and 4.7% skip a hot meal at least once every two days. Roughly half of Arab households report they cannot cover monthly costs. Preliminary 2025 estimates based on partial data point to further deterioration.

With around one in four children living in poverty, Israel has the second-highest rate of child poverty among OECD capitalist countries.

Poverty levels are highest in the ultra-Orthodox and Arab sectors, with 32.8% of Haredi households and 37.6% of Arab households falling below the minimum threshold.

Meanwhile, a growing class of “war poor” – families pushed into financial crisis after October 7 skyrocketed the cost of living – is struggling to afford necessities even when both parents work full-time, Latet’s 2025 Alternative Poverty Report, published in December 2025, warned. The report, compiled by the nonprofit aid organization, depicts a deepening social emergency in which “hunger and chronic financial stress are spreading from Israel’s weakest populations into the lower-middle class.” Its findings show that the economic shock of October 7 has both intensified existing deprivation and pushed thousands of previously stable households into poverty.

Latet calculated that the minimum cost of living in Israel in 2025 stands at approximately NIS 5,589 per person per month, or NIS 14,139 for a household of two adults and two children. This is significantly higher than the official poverty line set for 2025 by the National Insurance Institute (NII), at NIS 4,105 per person and NIS 10,508 for a family of four. Even NII’s two full minimum-wage salaries – roughly NIS 12,495 combined – fall short of Latet’s basic monthly budget (14,139). And with the average household employing just 1.35 earners, the shortfall reaches nearly 40%.

The gap between wages and the real cost of living lies at the core of the “new poor” phenomenon. Families of reservists saw their income collapse during the month-long call-ups, with self-employed workers forced to shutter businesses due to prolonged absences. The report also said that the cost of essential goods – food, housing, clothing, health, and education – has risen sharply. Per the latest estimates, an additional annual burden of roughly NIS 3,500 per person and NIS 9,000 per household, compared with previous years. The minimal health basket alone rose nearly 15% due to increased premiums and higher out-of-pocket spending.

Food insecurity is the most alarming area. According to the report, 26.9% of families – about 867,000 households – face food insecurity, alongside 2.8 million individuals and more than 1.18 million children. This represents a jump of roughly 27% to 29% from last year. Many households rely on donated food to free up limited funds for rent, electricity, and medicine. More than half of Latet’s aid recipients say they have reduced portion sizes or skipped meals; in the general population, the figure is 18%. Latet CEO Eran Weintraub said that without social structural reforms, Israel risks becoming a “super-Sparta” – a state investing heavily in war and occupation while class gaps widen unchecked.

Just a week before the Jewish New Year, in September 2025, far-right Prime Minister Benjamin Netanyahu predicted a future of economic and diplomatic isolation and continuous warfare. Netanyahu said that Israel — known globally for the tech prowess that earned it the title of “Startup Nation” — must aspire to turn into a 21st-century “super-Sparta” as it braces for an era of trade sanctions and boycotts.

Related: https://maki.org.il/en/?p=33154