“The immunity of the Israeli high tech stems from its ability to sell most of its product to the US,” Sergei Sumkin of the Aron Institute told The Media Line. “The demands of companies like Apple, Google and others are almost endless.”
Israel’s high-tech industry continues to grow, demonstrating resilience in the face of shifting trends, technological advances and political upheaval.
The sector, a primary engine of Israel’s economic growth, continues to perform strongly despite major challenges.
Alongside geopolitical instability, the increased adoption of artificial intelligence has reshaped the global high-tech industry, changing how companies hire and invest. Israel’s technology sector has not been immune to these changes, although their impact has not necessarily been negative. The strengthening of the shekel against the US dollar has created another challenge for the country’s export-dependent high-tech industry.
According to data released by the Israel Innovation Authority, Israeli high-tech output increased by 8.2% in 2025. There was a 30% increase in capital raising, record levels of exits, and a record share of high-tech in Israeli exports.
Rotem Meitiv-Klein is the CEO of Expiris, a high-tech recruiting firm. Their data also show that over 40% of Israeli tech companies plan to hire in the coming year.
This is a sign of recovery and resilience and is a higher figure than what we see in other countries that are less vulnerable to both geopolitics and global trends
“This is a sign of recovery and resilience and is a higher figure than what we see in other countries that are less vulnerable to both geopolitics and global trends,” Meitiv-Klein told The Media Line.
Israel is considered a global technology hub, recording $85 billion in exports, $84 billion in exits, and nearly $15 billion in capital raised throughout 2025, despite the period being one of major regional instability and war.
In the first quarter of 2026, this trend appears to be continuing. The tech industry reached a major milestone, with employment in tech positions surpassing 600,000, representing 7% growth. In a report released last week by The Aaron Institute for Economic Policy at Reichman University, this number represented a sharp increase and a departure from three years of employment slowdown.
“This is a big surprise,” Dr. Sergei Sumkin, head of the tech sector at the Aaron Institute, told The Media Line. “In the first quarter, as the shekel strengthened and Israel experienced a full month of war, this is not trivial. It is very encouraging to see an increase in employment and exports.”
Since October 2023, Israel has been engulfed in a major multi-front war. While its intensity has significantly lowered in recent months, the latest flare-up was with Iran in March of this year.
“Between 2023-2025, we saw a slowdown in employment in the tech industry and in tech jobs in other industries,” Sumkin explained. “Within the 7% increase in employment, we are seeing an increase in research and development jobs and in product jobs.”
In recent months, there have been major layoffs in Israeli companies and multi-national corporations (MNC) based in the country. Wix, Amdox and MNCs have significantly downsized their Israeli operations. Unicorns and start-ups have also experienced steep job cuts.
Even those who are firing, are simultaneously also hiring. They are looking for new employees that are better suited for the new tasks, new structure and new needs.
“Even those who are firing, are simultaneously also hiring,” Meitiv-Klein explained. “They are looking for new employees that are better suited for the new tasks, new structure and new needs.”
According to Sumkin, the increase in product-related jobs—roles that combine coding with product and marketing skills—contradicts predictions that AI would replace such positions.
“History has taught us that man and machine, or in this case AI, usually complement each other,” Sumkin said. “AI does not replace manpower, and in the past, we have never seen that employment decreased when new technology was introduced. Jobs will change, especially those whose positions can be taken over by computers.
In the past, we have never seen that employment decreased when new technology was introduced
Some argue that the bigger challenge is not job loss but adapting the workforce to a rapidly changing technological landscape.
“Professions aren’t being deleted, but it might be harder to find jobs, and there will be a need for a shift in education and skills,” said Meitiv-Klein. “We are in the midst of a transitional period between the need for traditional data and IT skills needed and AI literacy and the ability to develop AI-based applications and models.”
Despite major challenges, the numbers show that the Israeli tech industry is thriving and will continue to do so.
“The Israeli economy as a whole is very tech-dependent, and therefore it is less vulnerable to such changes,” Sumkin continued. “It is also highly diversified, and this diversity is a major contributor to its resilience.”
Almost three years of war have left Israel largely isolated in the international political arena.
“The immunity of the Israeli high tech stems from its ability to sell most of its product to the US,” he continued. “The demands of companies like Apple, Google and others are almost endless, and the ability of the Israeli tech industry to compete in these markets is a huge asset that must be protected.”
Several governments have announced weapons embargoes, while academic and cultural boycotts are spreading. A global surge in anti-Semitic incidents is also being linked by critics to Israel’s weakened international position. Israel is also being accused of committing genocide in Gaza, with an active court case at the International Court of Justice.
However, the tech industry continues to push forward as the numbers clearly demonstrate.
“The secret to the success and the resilience of Israel’s high-tech–is the people who work in the industry.” He adds that they are “resilient” and have the “ability to keep putting one foot in front of the other, even in very unstable periods–both nationally, or amidst winds of change in the industry,” Meitiv-Klein added. “This includes the Israeli entrepreneurs who keep coming up with new ideas, founding new firms, and this is expressed in the data we see now.”
One of the clearest signs of that economic resilience has been the shekel’s recent appreciation against the US dollar.
The shekel has strengthened sharply against the dollar in recent months, making it one of the stronger-performing currencies among developed economies. Economists attribute the appreciation to a combination of increased foreign investment, a rebound in confidence following the end of the high-intensity regional conflict, and strong inflows from Israel’s export-oriented technology sector. While a stronger currency reflects investor confidence, it also makes Israeli goods and services more expensive abroad, creating challenges for exporters who earn much of their revenue in dollars.
“The Israeli high-tech industry exports about 90% of its output, and as soon as the shekel is strong, this has an impact on the margin profits by squeezing them and impacting the ability to pay wages,” said Sumkin. “What has helped balance this is massive investments,” allowing breathing space “amidst the appreciation”
The Aaron Institute report shows a total $4 billion investment in Israel’s tech sector for the first quarter of 2026, a high figure that exceeds even some years prior to the outbreak of the war.
Despite strong employment growth, Israel’s high-tech industry still faces a new set of challenges. As AI reshapes the skills companies seek, and a stronger shekel squeezes exporters’ competitiveness, the sector is adapting to a rapidly evolving technological and economic landscape while continuing to demonstrate resilience.