AhlulBayt News Agency (ABNA): The Israeli regime's technology industry faces pressures that threaten its ability to continue growing. The most important of these pressures are the decline in entrepreneurial activity and the migration of the regime's skilled personnel abroad from the occupied territories.
According to a report by Al-Arabi Al-Jadeed newspaper, the relatively stable employment indicators and the success of some companies in the Israeli regime's technology industry in attracting capital and carrying out sale or acquisition deals do not necessarily reflect the dimensions of the risks whose effects may become apparent years later. This comes as the establishment of new technology companies in this regime has declined, and the sector's ability to attract labor and retain its employees is eroding.
Ofir Traub, the director of the Advanced Technology Association at the Israeli regime's Manufacturers Association, in an interview with the Hebrew newspaper Ma'ariv published today, Saturday, warned that the sector's current strength is not a guarantee of its continuity and that the consequences of the downward trend may only become apparent after several years.
The apparent stability of employment conceals the slowdown in growth
According to statistics from the Israeli regime's Technology Association, the number of employees in the technology sectors of this regime in the first quarter of 2026 reached about 362,200 people. This figure was about 361,200 in 2024 and about 360,100 in 2025.
This limited increase indicates a slowdown in the industry's employment growth after several years of rapid development. This relative stagnation has occurred simultaneously with concerns about the decline in the number of new companies starting their activities.
Traub believes that the success of some companies in the Israeli regime's technology sector in attracting investment and carrying out sale or acquisition deals is not a guarantee of the continued acceleration of this industry's growth. Because these companies operate on the basis of projects that began years ago.
He warns that the decline in entrepreneurial activity may remain hidden for a while in employment, export, and investment statistics, and its real effects may only become apparent several years later.
Artificial intelligence puts pressure on employment and business models
The data of the Israeli regime's Technology Association published by Ma'ariv newspaper indicates the expansion of the use of artificial intelligence in companies. According to this data, 73 percent of the surveyed companies have used this technology in the field of research and development and innovation, and 66 percent have also used it in administrative and commercial processes.
Traub said that artificial intelligence forces companies to change their strategies and products and to do a larger volume of work with fewer employees.
He emphasized that this transformation is still ongoing and that it is still too early to announce that companies have passed its consequences.
According to him, the nature of jobs is also changing as a result of automation. To explain this trend, Traub referred to building-painting robots, which, with the introduction of these technologies, reduce the need for certain manual tasks, but in contrast, new roles emerge for setting up, guiding, and controlling the robots.
He described the labor shortage in the industrial sector as very large and believed that the combination of artificial intelligence and robotics could help reduce this shortage.
The gap between companies and the rising cost of technology development
Traub referred to the significant differences between software companies and hardware companies, as well as between startups and large global conglomerates.
According to him, these companies are not in the same conditions in terms of maturity, financial needs, and ability to cope with transformations.
Also, developing activity in advanced technology fields has become more dependent than before on costly infrastructure and large-scale investments. This issue places a bigger obstacle before companies. An obstacle that companies active in fields such as cybersecurity faced with less intensity in past years.
In some cybersecurity sectors, a group of experts could start activity with relatively limited facilities by relying on their knowledge and experience. But the expansion of new advanced technologies requires more extensive financial resources and infrastructure.
The decline of the dollar puts pressure on technology companies' revenues
The decline of the dollar against the Israeli regime's shekel imposes additional pressure on the technology companies of this regime, which earn a large part of their revenue from foreign markets but pay their operating costs and employee wages inside the occupied territories.
With the decline of the dollar, the value of these companies' foreign currency revenues decreases after conversion into the Israeli regime's shekel. While many of their expenses are still paid in the national currency.
Traub acknowledges that companies or the government alone do not have complete control over the exchange rate but has called for measures to be taken to help export-oriented companies in the Israeli regime's technology industry to absorb the losses caused by exchange rate fluctuations.
According to him, this issue is more important for companies that have a high dependence on exports and have employed dozens or hundreds of people.
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