Israel's high-tech industry, the growth and export engine of the country's economy, is going through difficult times. Statistics indicate that more and more start-up companies find it hard to raise funding, while older companies are cutting personnel.

lastartup website, which monitors the Israeli high-tech industry, reports that from March 2022 until the beginning of the current month, over 5,700 employees lost their jobs. 15% of those laid off were employed by cybersecurity companies, 12% by SaaS companies, 10% content and media and 9% fintech.

The Central Bureau of Statistics at the end of October reported that the rate of vacancies in the high-tech industry dropped to 6.8% at the end of the third quarter of this year. This represents a decrease of 11% compared to the second quarter of 2022 and a decline of 22% compared to the first quarter. Vacancies in other sectors of the economy are stable, and an increase was even observed in demand for employees by the hospitality and food service sectors as well as in the cultural and leisure sectors.

Signs of contraction are apparent also in funding. Based on a recent report issued by data source and business information firm, IVC, and the high-tech banking arm of Leumi Group, LeumiTech, during Q3 2022, Israeli high-tech companies raised $2.57 billion in 143 rounds. This amount represents a 38% drop from Q2 2022 and a 55% fall compared to Q3 2021. The number of rounds declined as well, though less sharply — 22% and 16% compared to Q2 2022 and Q3 2021, respectively.