BDO LLP | INTERNATIONAL TECH HUBS
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TALENT POOL A striking development in the last 10-15 years or so is that the salaries of tech professionals – coders, developers, UX, IU and so on – have risen by as much as 300%, in recognition of the quality of talent here. Where once US companies might have swept in from Silicon Valley or Boston to swoop up top talent at relatively cheap rates, now they find that the salaries of skilled Israeli tech practitioners are on a par with US salaries. The strength of Israel’s tech talent is the ultimate source of its success. Where once every Jewish mother might have been proud to see their daughter or son become a doctor or lawyer, those traditional aspirational roles have given way to things like coding or software. And such sophisticated, well-trained and experienced people are always in very high demand here too: Israel always needs more. The Israel market offers a very high level of talented young people who will go on to become some of the world’s finest future technology leaders. There are good reasons for this, such as a sophisticated education system which continues to pump out new talent, and the maturity of a marketplace where all the world’s major tech players are represented and new ideas and businesses are vying for primacy every day. On top of that, however, is a unique factor to Israel: the role of military service in developing tech talent. Every 18-year-old in Israel must do a year’s military service. The Israeli military has dedicated specialist technology units, backed by virtually unlimited resources, where young talents can hone and develop their skills in critical real-world situations such as cyber- security and counter-intelligence. While an American or European 18-year-old is practising coding in their bedroom, an equivalent Israeli could be engaged in real-life covert military scenarios that to their counterparts around the world would be familiar only from the movies. As a result, when they leave military service, their skills are extremely advanced in terms of experience and expertise, and just a step away from becoming highly paid professional specialists who are attractive to the best global tech firms. A key reason why so many of the world’s global tech players and Fortune500 companies have established operations in Israel is to have direct access to this cutting-edge talent and the vibrant culture of innovation that goes with it. Companies want to reach these people at the source, not wait till they’ve travelled aboard and become even more expensive. It’s very common for big global players to set up an R&D centre in Israel and recruit local talent to help them develop their next innovation. Global tech companies are looking for dynamic, experienced people with a positive attitude, and a proactive mindset operating in innovative areas. In Israel there are about 220 R&D centres owned and operated by international technology players – not just the real tech giants, who are of course also present here, but also the second-tier players, who all have a footprint in Israel, where they’re driving future innovations. Every Fortune 500 company is here, whether it’s a pure tech player or just tech-enabled, from Ford to Cisco. Typically they come to Israel, take over a local entity, transform it into their R&D centre, and look to develop a new technology or create a relationship with other players.
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