Israel recruiting ultra-Orthodox for the diamond industry – by Ari Rabinovitch and Tova Cohen (Reuters/Toronto Star – January 6, 2013)posted in Canadian/International Media Resource Articles, Diamonds and Gemstones |
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RAMAT GAN, ISRAEL —Diamond manufacturing is a dwindling trade in Israel. The country has one of the world’s hottest diamond exchanges, but polishers and cutters of the precious stones have been replaced by cheaper workers in newer hubs like India and China.
Israel wants to bring them back. To do so, it plans on recruiting a legion of ultra-Orthodox Jews, who because of their dedication to prayer and study, have been unable or unwilling to join the work force, putting a heavy weight on the economy.
The job of a diamond polisher, however, is unique, said Bumi Traub, president of the Israel Diamond Manufacturers Association. It need not disrupt their pious lifestyle.
“The profession is fitting. You deal with the rock, and if you need to go pray, no one will bother you,” he said. The door to Traub’s office requires a fingerprint scan. Security is tight in the four-building exchange where annual turnover of trading reaches $25 billion (U.S.) each year.
About a third of rough diamonds produced in the world each year pass through the Jewish state and diamonds account for more than one-fifth of the country’s industrial exports. It was a natural sector to develop when Israel was founded 64 years ago, since the small stones have been choice merchandise for generations of Jews who had to quickly flee from riots and persecution.
The plan to revitalize manufacturing will cost millions of dollars and the diamond sector, for the first time, is turning to the government for help. The government, eager to get as many ultra-Orthodox working as possible, is on board.
The global financial crisis has taken a toll on the diamond trade, and Israel has not been spared. Turnover was nearly halved at the outset in 2009, though in 2011 it returned to precrisis levels. A smaller drop is again expected for 2012.
The damage has been moderate compared to other major hubs such as India, according to Yair Sahar, president of the Israel Diamond Exchange.
“In other centres the leverage was tremendous, as opposed to here where we were much more conservative,” he said, referring to the low level of debt among Israeli firms. “We entered the crisis more prepared, so to speak.”
There have, however, been other problems.
The price for raw material has risen faster than that of the final product, eating away at profits. And a money laundering and tax evasion scandal at the start of 2012 scared away some customers. The investigations have ended and, so far, no one has been charged.
The diamond trading floor in Ramat Gan, a suburb of Tel Aviv, is the biggest in the world. Armed guards escort non-members and on one wall are mug shots of problematic dealers whom customers are urged to avoid.
For the rest of this article, please go to the Toronto Star website: http://www.thestar.com/business/article/1310885–israel-recruiting-ultra-orthodox-for-the-diamond-industry