Intel, Israel’s largest private-sector tech employer, is implementing workforce reductions as part of a global restructuring effort.

The company’s workforce in Israel, which peaked at 12,000 employees in 2021, has fallen to below 9,350 this year. Further cuts are expected at the Kiryat Gat fabrication plant.

The Kiryat Gat plant is a vital site for Intel’s operations and has received significant support from Israeli state funding. Recently, Intel has accelerated automation at the plant as part of broader cost-cutting measures under CEO Lip-Bu Tan’s strategy. This comes amid increasing global competition in chip manufacturing.

Intel’s RISE report details the company’s contributions to Israel’s economy since it began operations in 1974.

The report states that Intel has exported over $86 billion in goods and services, with roughly US$55 billion generated in the past decade.

It also reported more than US$25 billion in local procurement since its inception, including US$18 billion in the last ten years.

The report estimates that each direct job at Intel creates up to four additional jobs through local supply chains and service providers.

Furthermore, Intel has noted its investments in STEM education, diversity initiatives, and partnerships with local suppliers, including minority-owned businesses.

Despite these contributions, there are concerns about Intel’s future investments in Israel, particularly regarding the potential expansion of the Kiryat Gat facility.

The company had previously announced a US$25 billion project to build a new Fab38 plant, but has not confirmed its commitment amid ongoing budget cuts.

Globally, Intel has announced job cuts totaling over 6,400 positions in the United States, including 2,400 in Oregon. While the layoffs in Israel have been gradual, they are being closely monitored by local communities that depend on the company’s presence.

Intel’s long-term role in Israel’s high-tech sector remains uncertain as it navigates economic contributions and cost-saving measures in a competitive global market.

Recent Intel developments