One of the main challenges for Israel’s high-tech is diversifying the population segments that enjoy its fruits – like earning above average salaries. A new initiative will enable Ethiopian Jews, Ultra-Orthodox Jews and Bedouin army veterans to take part in high-tech occupations at the Negev Technology Solutions Center (NTS), which is being currently built in the town of Yeruham.
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The center will provide outsourcing services for Israeli companies. In its first year, it will employ around 35 workers, 85 in the second year and within three years, it is expected to have 100 employees. The initiative is led by Negevco, a private firm which develops businesses in the Negev (a desert town in the south of the country), and Andres Kukawka, a former VP at Ness Technologies.
“Near-shore” centers, such as the one being built in Yeruham, are one of the ways of enabling populations that are traditionally scarce in the field of high-tech, to join it. Instead of offering outsourcing solutions in India or Eastern Europe, these centers allow outsourcing to a place geographically close-by.
Unlike other forms of employments in high-tech, Israeli near-shore centers are low-cost in terms of manpower and operation, and predominantly employ two segments in the Israeli population: Arabs and ultra-orthodox Jewish women. Such centers operate in Bet Shemesh, Jerusalem, Nazareth-Elite and Be’er Sheva, which houses centers operated by Ness Technologies and TELDOR.
Kukawka explained (to The Marker magazine) that the location was selected due to Yeruham’s potential of becoming a high-tech hot spot: “Be’er Sheva became a high-tech center when companies like ECI and EMC set up shop there. Yeruham and Be’er Sheva are like Tel Aviv and Herzliya.” According to Kukawka, there are several mobile and web-developing companies operating out of Yeruham, and there is also an incubator there, operated by The Center for Educational Technology.
The center at Yeruham will provide development and maintenance services in COBOL, JAVA and PHP and also offer services in the fields of web and mobile application development and QA. Recruitment will start in November, and will focus on people from Yeruham and surrounding towns. In addition, special training programs will be offered to Ethiopian Jews, ultra-orthodox Jews and Bedouin army veterans, with hopes of keeping them in Yeruham. Over the next three years, $820,000 (NIS 3.2 million) will be invested in the project, funded by Negevco and other investors.
Employees at the center will earn a lower salary than their high-tech counterparts in central Israel, but Kukawka claims that tax perks given to workers in peripheral areas will increase their net earnings. “Everybody (in Israel) thinks of the Negev and peripheral Israel and has negative memories from their army training days – but the Negev’s has quality, ambitious people, whom we intend to harness to everyone’s benefit”, say Kukawka.
In the meantime, NTS has not signed with any costumers yet. “Our clients could be banks or insurance companies who need maintenance, a startup company who wants to cut costs without outsourcing to India or any other high-tech company,” says Kukawka.
The project will be unveiled at the NegeVision conference this November, which aims to present the business and economic potential of the Negev. The conference is held by Negevco, the Ministry for Development of the Negev and the Galilee, the Eastern-Negev Center for Development of Entrepreneurship and the Yeruham local council.
To read this story in Hebrew, click here.
Via TheMarker TechNation
Photo by Larry Miller