A Charedi Majority, with Buying Power

letter-447577_1280

The Jerusalem Post reports that “every fourth baby born in Israel is haredi and so is 52% of the Jewish population under 18 year old.” Yay for the charedim, right? Well, I was scared for a moment, because it meant that that majority of babies born in Israel aren’t Jewish. Given that the Charedi population is growing rapidly, if 52% of Jews under 18 are Charedi, I think we can safely say that roughly 60% of Jewish babies are. And if those 60% are only 25% of babies, that means 58% of babies aren’t Jewish, if I have my math right.

The good news is that I think the JPost included the Palestinian Authority in those numbers. Analysts have been writing about the Arab demographic time bomb for years, along with comparisons of fertility rates not only between Arabs and Jews, but between Gaza, the West Bank, and within the pre-1967 Green Line. As Phill Brennan reported for NewsMax in 2002, “In 2000, total fertility rates (TFR) in the Gaza Strip were the highest in the world at 7.4 births a woman. The TFR in Palestine (5.9) was almost twice as high as in Israel (3.0)… Similar trends can be seen within Israel: Jewish women have a TFR of 2.7 compared with 4.8 for Arab women.”

But as Jon Dougherty wrote a year and a half later, projections of trouble within a generation include the West Bank and Gaza. So, if we can now exclude PA territories from calculations of future Knesset elections, and given a charedi TFR of at least 4.8 (among Chassidim, the average family size may exceed nine!), the charedi population is apparently on track to become not only the majority of Jews, but the majority of Israelis.

The JPost dropped these Jewish population numbers in an article about a new charedi purchasing co-operative. Taking a lesson from WalMart, “The haredi community launched what might prove to be the nation’s largest-ever consumer bloc on Sunday.”

“Dozens of yeshivot, seminaries, women’s schools and other educational institutions from all walks of haredi society – Lithuanian, Hassidic and Sephardi – plan to concentrate their buying power. Working together, these institutions hope to eliminate the middlemen and pressure wholesalers to lower prices… Huge yeshivot such as Ponevezh and Slobodka will join forces with the Beit Ya’acov Girl’s School and Hassidic courts to create a consumer force to be reckoned with.”

Various sources are quoted in the article pointing to the diverse tastes of charedi consumers, and — for this reason — doubting that households will participate.

“Satmar rely on the Eda Haredit for their meat while Lithuanians will only eat Rabbi Rubin’s kashrut certification and the Sephardi buys Beit Yosef,” said a haredi ad man who preferred to remain anonymous.

“Besides, the haredi market has grown accustomed to choosing from a wide range of products. So I don’t see how it will be possible to create a consumer bloc for one specific product.”

I think these pundits are mistaken, and the reason is WalMart. The various yeshivos and seminaries and “Hassidic courts” all have the same issues with kashrus and product preferences — but as WalMart shows, the same bulk-buying pressure can be exerted across a range of vendors. The real issue is delivery to individual customers — will the co-op sell to the corner makolet? Will it build super-stores? I do not think the “Hassidic courts” only intend to lower prices within the schools, but across the chassidim, and so they need a delivery model — or however well-meaning the initiative, the goal of “savings on staple products and food of as much as 30%” may never be realized.

You may also like...

26 Responses

  1. Yaakov Menken says:

    David, any backing for those numbers? You could well be right, but the JPost’s assertion was that “every fourth baby born in Israel is haredi and so is 52% of the Jewish population under 18 year [sic] old.”

    Since the publication of this post, the World Tribune came out with a new article about a “study by the Washington-based American-Israel Demographic Research Group.” “The group said that by 2025, Israel’s ultra-Orthodox Jewish sector would grow from 16 percent to 23 percent of the nation’s population. The ultra-Orthodox was expected to increase to 29 percent of the Jewish sector.”

  2. David says:

    WRONG NUMBERS – Please notice that 25% of all JEWISH Israeli newborns are Hareidi (or rather born to hareidi families). 52% under 18-years old are in no way hareidim, the articles in press were about similar number keeping some mitzvot like some sort of shmirat shabbos or some level of kashruth. At the moment, there are about 100,000 hareidi families in Eretz Yisroel (average number is 6 persons in a family – kein yirbu).

  3. Shlomo says:

    I live near a charedi grocery story in a northern Israeli city. The prices at the charedi store are usually 20-30% lower than in the “secular” grocery store nearby (except for meat of course). The quality of the food is often, but not always, 20-30% lower as well…

  4. dovid says:

    RE: Comment by SephardiLady — May 3, 2007 @ 2:37 pm

    You have a cold thanks to your kids? Baruch HaShem. It’s kaparah. A parent who experienced tzar gidul banim will not see pnei gehinom. You hear? not even it’s facade, let alone the inside. May you have refuah shlemah. The little rascals need you healthy and in top shape.

  5. SephardiLady says:

    Dovid,
    I’m sure my thoughts are more than a little disjointed amidst my newest head cold (thanks kids!).

    I really don’t more examples. I can think of a few myself.

    My comments and questions still stand. Where will the start up funds come from? Will the education sector loose interest if they don’t see a ROI of time or money quickly? Will the consumer cooperate in unity if they don’t see a return within 6 months, 1 year, 2 years, or 5 years?

    I would love to see this plan succeed. I’d love to see the US day schools and yeshivas/bais yaakovs come together in different regions to form their own buying block. But I think the focus of the plan is very scattered and thereby fails to capture imagination, investment, etc.

    That is all.

  6. dovid says:

    I would like to add to my previous post the following two excerpts from Ha’aretz about Yakov Litzman. (I did a search on him to get more background information and came across the article in Ha’aretz). http://www.haaretz.com/hasen/spages/807843.html

    Litzman has received accolades for his work as chair of the Finance Committee, including from his political rivals. Several weeks ago, when coalition chairman Avigdor Yitzhaki tried to unseat him, he encountered stiff opposition from MKs across the political spectrum.

    Those who work with him note his cleverness and shrewdness. Even though he lacks any formal education in economics, he faces off with no inferiority complex against powerful financial barons and sharks.

  7. dovid says:

    RE: Comment by dovid — May 1, 2007 @ 9:34 pm and Comment by dovid — May 3, 2007 @ 9:55 am

    I did not mean to convey that learning Gemara is a guarantee to success in business. Furthermore, one should definitely not learn it in order to achieve success in business. I was responding to a post that I found it derisive and wrong (“I do not believe that the Yaakov Litzman and Co. will be able to duplicate any of the Wal-Mart back-end, and as such, they will certainly fail to deliver Wal-Mart savings”). “Yaakov Litzman & Co.” do not have to duplicate the WalMart model and still they can be fabulously successful, way above WalMart. I have worked with the shiniest investment firms. Their Orthodox Jewish clients (none of them a business grad) are treated with utmost respect due to their success in business. By the way, Bill Gates is a high-school dropout. His business model is taught at Stamford B-School.

  8. dovid says:

    “I do not believe that being a talmid chacham translates into business acumen, negotiating power, and all of the other skills needed”

    I worked 20 yrs. ago for Olympia & York, owned by the Reichmann family. The principals were very learned, pious Jews. They had the typical background of Charedi Jews, plus WWII experience as refugees in France, Morocco, etc. They didn’t have MBAs. I doubt they had high school diplomas. Guess what? They had plenty of the “business acumen, negotiating power, and all of the other skills needed”. One of their senior managers was a former talmid of Yeshiva Chaim Berlin, known for his hasmadah in his yeshiva yrs. He never stepped his foot in a college. Attorneys kept calling him to pick his brains. Let me know if you need more examples.

  9. SephardiLady says:

    Dovid,
    I have no lack of respect for those that know gemorrah inside and out. And I believe there is a wealth of business knowledge to be found inside the Talmud. But I do not believe that being a talmid chacham translates into business acumen, negotiating power, and all of the other skills needed to get this plan off the ground and put into action.

    I posted some of my own thoughts, but I think the plan as presented has far too many objectives and far too wide of a reach. A more limited set of goals that can be achieved would be far better.

    Also, where is the money going to come from to finance the start-up costs? Surely there are plenty of them.

  10. jr says:

    Jacob Haller wrote:

    For example, if a lesser or non-observant couple from North Tel Aviv work in the high-tech industry for an American or European company, move into a 30 year old apartment complex and have 2 kids or less where is the “building”?

    Jacob,
    The above couple pays taxes (probably close to 50% of income) which support the army, infrastructure, health care, education, etc. All of which helps build/maintain a country not just oneself and his immediate family. (including the charedi community).
    Plus, of course, the military service.

    See the difference?

    JR

  11. easterner says:

    if the hareidi israeli street could vote with their feet, and not just to daas torah, i would assume they would be more like US style hareidim— and in the US govt there are actuaries, lawyers etc — one could envision a similar israeli hareidi society including a machane kaddosh, and again chassidishe officers [ in the days of 67 war there were still chabad and Ger in the army……][see for example the JPS book on the six day wardescribing the chassid reserve officer brought to the base still in shabbos garb….

  12. Jacob Haller says:

    Calev wrote

    “Charedim taking on their share of the responsibility of physically building and protecting the country.”

    Please define terms and explain how other population grops “building” the country?

    For example, if a lesser or non-observant couple from North Tel Aviv work in the high-tech industry for an American or European company, move into a 30 year old apartment complex and have 2 kids or less where is the “building”?

    I’m not one to judge anyone who might fill the oversimplified example above, of course and they deserve kudos for living in the Eretz while I do not. However, I gleaned from your statement an implication that Charedim at present play no role in building the country while it’s a given that other sectors by default do their share.

    I’m not sure how to define “defending” and if it’s limited to military service. As stated in other posts, Charedi acculturation into the military is complex. Furthermore, I’ve heard that young women from the Mizrahi camp who work in Sherut Leumi in place of two years in the military are often also targeted for abuse for being “slackers”.

    I vote that a Sherut Leumi participant working with special needs children gratis are accomplishing a lot more in any and every sphere than perhaps 95% of Israel’s chayalot (female soldiers).

  13. Jacob Haller says:

    Ori wrote

    “It would be impossible to replicate that in a market the size of Israel. If there were no political issues it might be possible to do it for the entire Middle East – but that would truly take a miracle.”

    That’s exactly one of the utopian line items that Labor/Meretz used to woo the public into accepting the Oslo plan.

  14. dovid says:

    When we are called to make a substantial contribution to the defense of EY, we will do it based on halacha and not on Ben Gurion’s doctrine or some government’s whims, so that our machane will be kadosh.

    Nachal Charedi has no female soldiers in their base. What tznius problems could they possibly have?

  15. Calev says:

    If predictions are correct that we can expect a majority Charedi population in Israel then I hope we can also look forward to a majority of the Charedim taking on their share of the responsibility of physically building and protecting the country.

  16. L.Oberstein says:

    As far as chareidim joining the army, you won’t get an argument from me. If that is the goal, then the government has to understand the psyche of the chareidi world and deal with them realistically. There are legitimate concerns regarding tzniyut and kashrut which the chareidi nachal unit deals with.Maybe with time this unit will become more popular. If there is a desire to work and earn a living, then the army will become more of a necessity and ways will be found.
    Right now, there is a gulf that divides one group of Jews from another. In the Baltimore Sun article, one chareidi remarks that he was surprised to see that not all secular Jews hate chareidim. With “sechel” the chareidim can become more invested in the state. t won’t happen by force.

  17. Ori Pomerantz says:

    Dovid, Wal-Mart’s efficiency depends heavily on economies of scale. It would be impossible to replicate that in a market the size of Israel. If there were no political issues it might be possible to do it for the entire Middle East – but that would truly take a miracle.

    Of course, that doesn’t mean there aren’t other advances in logistics that Yaakov Litzman and Co. could discover. If they did manage to attain Wal-Mart level efficiency in Israel, telling the rest of the world how they did it would be a tremendous act of Chesed – those advances could save lives in countries where some people are close to the starvation level.

  18. dovid says:

    “I do not believe that the Yaakov Litzman and Co. will be able to duplicate any of the Wal-Mart back-end”

    Dear Rejewvenator, you are in a dire need to rejuvenate your outlook and overhaul your thinking. Yaakov Litzman and Co. consists of people who mastered many pages of the Talmud and its commentators. If they were able to do that, Wal-Mart’s back-end, front-end and side-end are a piece of cake. You still don’t believe me? Try one page of your choice and don’t stop until you know it real well and then you know what I mean.

    “the buyers’ club will line the pockets of the participating institutions without passing significant savings on to the consumer.”

    If they don’t pass the savings on to the consumer, they have no clients. People won’t buy from them if they can save.

  19. dovid says:

    L. Oberstein, we will have to assume responsibility for the defense of EY as well.

  20. L.Oberstein says:

    You may want to read the article in this past Sunday’s Baltimore Sun. It profiles a 50 year old man who had no marketable skills a year ago but took a course and became a therapist who works with handicapped males in a swimming pools doing therapy. He is now earning a living and supporting his family. Up until a year ago, he was a full time learner in Kollel and had intended never ever to enter the work force. He was forced to by the drastic cuts in welfare payments that made it impossible for him to continue his lifestyle. The article says that basicly his rabbis are not telling him to go to work but are looking the other way and tacitly allowing it. The article says that more and more chareidim are taking courses and entering the work force out of economic necessity. This is one of the most positive articles I have read about Israel in a long time. If the population becomes more chareidi, as you say, then they will have to assume more responsibility not only for their own lives but for the common welfare as well. I hope it happens.

  21. rejewvenator says:

    What makes Wal-Mart so successful is their incredible logistics, as any business school grad will tell you. From their warehousing, distribution, and tracking systems to their point-of-sale communications (which includes, btw, a proprietary satellite system to handle data transfer), Wal-Mart has built an infrastructure that is without peer.

    I do not believe that the Yaakov Litzman and Co. will be able to duplicate any of the Wal-Mart back-end, and as such, they will certainly fail to deliver Wal-Mart savings (and let’s put aside Wal-Mart’s questionable employment practices for the moment, which we can only hope will not be duplicated).

    What will likely happen, and excuse me please for my cynicism, is that the buyers’ club will line the pockets of the participating institutions (who surely are participating because they will have a stake in the revenue) without passing significant savings on to the consumer.

  22. Lumpy Rutherford says:

    I’ve never been to Israel. However, I do understand that a makolet/מכולת is a grocery store. Is it a small grocery store like a bodega in NYC?

  23. Joel Rich says:

    R’YM,
    Perhaps you might include in your demographic projections what the GNP will be under this scenario, what trends in workforce participation will look like, and how the pie will be split (e.g. defence,education,welfare)and what the government will look like?

    BTW Walmart is currently taking tremendous heat on their employee relations(compensation. benefits, union avoidance) and vendor relations (whose hide do you think the savings come from?) Not tosay they are wrong or unethical, but these are issues.

    KT

  24. Bob Miller says:

    Or find a way to do home delivery economically, where there are enough customers per block.

  25. Moshe says:

    Actually, there already are very large Israeli Charedi supermarkets that are substantially less than their Chiloni counterparts. The best example is Alef – formerly Zol Po. It is far cheaper than other stores, yet there is a limit as to which brands they carry. I can’t see how much cheaper things can get, unless they work like walmart and give everyone who works there the minimum wage. Is that a Jewish thing to do? I don’t know, but it would make an interesting blog post.

  26. Ori Pomerantz says:

    In the US superstores rely cars to get consumers to the store and carry them back with their purchases. IIRC, Charedim in Israel are a lot less likely to have cars. To build superstores, CharediMart[TM] will need to provide transportation, especially on the way back (it’s a nightmare to stand in an Egged bus with heavy baskets of groceries).