Organized crime adds 23 billion shekels to the annual cost of living in Israel [1].
These findings highlight how criminal networks penetrate essential industries to inflate prices, deepening a national economic crisis for average citizens. The burden extends beyond corporate losses, directly impacting the affordability of housing and basic goods.
Researchers studying Israel's economy and organized crime networks released the data in 2024 [1]. The study estimates that the presence of these criminal syndicates adds approximately 8,000 shekels to the annual expenses of every household [1], [2].
The impact is particularly severe in the construction and housing sectors. According to the research, extortion accounts for roughly five percent of all construction costs [1]. This systemic skimming increases the price of new developments, a cost that is eventually passed down to homebuyers and renters.
Beyond construction, the study identifies agriculture as another sector vulnerable to these networks [2]. By extorting businesses and manipulating supply chains, criminal organizations create an artificial price floor that makes essential goods more expensive for the general population.
This economic drain functions as a hidden tax on the Israeli public. While government policies often target inflation through monetary tools, the research suggests that a significant portion of the cost-of-living crisis is driven by illicit activity rather than market fluctuations alone [1], [2].
“Organized crime adds 23 billion shekels to the annual cost of living in Israel”
The data suggests that Israel's cost-of-living crisis is not merely a result of macroeconomic trends or government policy, but is actively exacerbated by systemic organized crime. By infiltrating the construction and agriculture sectors, criminal networks create a 'crime tax' that disproportionately affects low- and middle-income households, potentially limiting the effectiveness of standard economic interventions to lower prices.
