If residential building was initially a positive growth factor, now it will probably be flat in 2001. Households are more pessimistic. Housing starts, or the number of new homes being built, were estimated at 43,000 for 2000, with a similar figure for 2001, Katz said. Those figures were in line with Israel's moderate immigration rate and the country's natural population growth rate. But with the current unstable political situation and expectations for it to continue for several months, estimates are much less positive.
Closed borders mean fewer Palestinian construction workers showing up for work.
When they don't show up, the whole process grinds to a halt. Expectations for the coming year have fallen dramatically as the number of available workers from the Palestinian Authority has declined. A total of some 252,000 workers are employed in the industry and some 57,000 are Palestinian. But there would still be a gap and it's up to the government to let us bring in foreign workers. As a result, the construction sector will probably end up with only 40,000 housing starts instead of 45,000, a 10 percent drop in the estimated figure.