Number of high-tech workers in Israel 2023, by sub-sector

Israel's advanced technology sector continued to be a major driver of the country's economy in 2023, employing over 440,000 people. Among the various technology industries, computer programming ranked first in job creation, with 227,500 workers. It was followed by computer and electronics manufacturing with 79,700 employees. The important position of local high-tech is further underscored by its world-leading investment in research and development, with 6 percent of GDP dedicated to R&D in 2022.

Global startup ecosystem leadership

Israel has grown to become a global center for tech startups, ranking third worldwide in 2024, according to StartupBlink's Global Startup Ecosystem Index. This puts Israel behind only the United States and United Kingdom, highlighting its outsized impact given its relatively small size. Within Israel, Tel Aviv stands out as the primary hub, ranking first in the country and ninth globally among the best cities for startups.

Investment landscape picking up?

Israeli venture capital experienced a significant slowdown in 2023, with total investment falling below 7 billion U.S. dollars, the lowest level since 2018. This marked a decline of 73 percent from the 26 billion U.S. dollar peak in 2021. Several factors contributed to this poor performance, including a global slowdown in venture capital funding, as well as local impacts such as a contentious government plan to reform the judicial system and the outbreak of the Israel-Hamas war. Early 2024 data indicate this negative trend may be turning.