Israel

Israel: strong, sustained growth, 1980–2025

A globally significant technology and defense-industry cluster, built on strong R&D investment and a deep talent pipeline from mandatory military service, has powered growth despite recurring regional conflict. Between 1980 and 2025, Israel's GDP per capita grew from $6,545 to $60,337 (current US$), a compound annual growth rate of 5.1% — strong, sustained growth. Annual GDP growth averaged 4.0% with a year-to-year standard deviation of 2.4 points, reflecting relatively stable macroeconomic conditions. Structurally, agriculture's share of the economy moved from 2.1% to 1.3% of GDP (a classic decline as the economy industrialized/modernized), while services rose from 62.9% to 72.8% of GDP, underscoring a shift toward a services-driven economy. On human development, life expectancy rose from 73.9 to 83.2 years, while tertiary school enrollment moved from 51.1% to 56.3%, while the urban population share grew from 88.8% to 91.6%.

What this growth cost: Growth was not without cost: per-capita CO2 emissions rose from 5.27 to 5.77 tonnes CO2e per person; income inequality (Gini index) widened from 36.5 to 38.3; the poverty headcount ratio fell from 0.5% to 0.4%.