Israel's War Costs Reach Tens of Billions as Mental Health Toll Mounts
A National Insurance Institute report reveals that Israel spent tens of billions on the civilian toll of the war, highlighting 58 billion in reservist pay and a surge in mental health disabilities.
Three years have passed since the black Saturday of October 7, and the National Insurance Institute report published today reveals the staggering dimensions of the civilian toll. Behind tens of billions of shekels lies an entire nation trying to recover—on the front lines, the home front, and in mental health.
Massive Reservist Compensation and Labor Market Shocks
The immense war effort forced the state to open its coffers. No less than 58 billion shekels have been allocated over the past three years for reserve duty compensation alone, paid for the first time in a continuous monthly format.
The labor market also suffered severe shocks, with unpaid leave payments totaling 4.2 billion shekels distributed across three combat rounds: "Iron Swords" (2.5 billion to 210,000 unemployed), "Roar of the Lion" (1.7 billion to 196,000 people), and "With the Strength of a Lion" (about half a billion to 100,000 people). In an effort to prevent employment collapse, return-to-work grants costing 1.2 billion shekels were distributed to 74,000 workers.
Housing Evacuations and Disparities Between Fronts
Yet the war not only halted the economy, it also redrew Israel's housing map. The state treasury paid more than 5 billion shekels in housing grants to 190,000 evacuees who chose not to crowd into hotels.
The gaps between the fronts cry out from the data: while 131,000 evacuees from the South were paid 1.3 billion shekels, 63,000 evacuees from the North were allocated 3.8 billion shekels. With the beginning of the trend of returning home, the National Insurance Institute transferred another 1.42 billion shekels as return grants to 110,000 residents, and another 272 million shekels as unemployment alternatives.
"More than 9 billion shekels have been transferred to the families of hostages, the fallen, and victims of hostilities—a sum that jumped from 800 million in 2023 to 3 billion in the current year."
The Hidden Epidemic of Mental Wounds
The most painful numbers are found in the section on casualties and physical injuries. Since the outbreak of the war, the National Insurance Institute has been handling 87,286 victims of hostilities, of whom 84,000 received immediate assistance grants totaling 662 million shekels.
Out of more than 40,000 people who have already been officially diagnosed with a disability, the most shocking figure reveals the hidden epidemic of the war: the absolute majority, 34,878 citizens, were recognized as disabled due to mental trauma, compared to only about 3,171 physical injuries. The state may be funding rehabilitation expenses at over 750 million shekels, but the healing of the Israeli psyche will take many more years.
