How do the incomes of Israeli Arab physicians compare with those of Israeli Jewish physicians?

In 2023 Israeli Arabs (i.e., Arab Palestinian citizens of Israel) constituted 22% of Israel's working-age population. In that same year, Israeli Arabs constituted 25% of Israel's employed physicians of working age - up significantly from 8% in 2010. The objectives of this study were to: 1) assess whether, and to what extent, there is an Arab-Jewish income differential among Israeli physicians; 2) assess the extent to which any such differential can be attributed to Arab-Jewish differences in the demographic, geographic, and/or work-related characteristics of the medical workforce; and 3) explore the policy implications of the key findings.

The analysis utilized the Central Bureau of Statistics' 2022 Population and Housing Census, which included data on 7,089 physicians, of whom 1,333 were Arab and 5,756 were Jewish or other (hereafter "Jewish"). The main income variable examined was "Total annual gross income from work".

In 2022, the average annual physician income for Arab physicians was 26% less than for Jewish physicians (NIS 358 thousand vs. NIS 483 thousand). Arab physicians were more likely to be under age 40 (71% v. 28%), male (77% v. 52%), residents of the North region (48% v. 7%), in non-supervisory roles (87% v. 75%), and generalists or family practitioners (33% v. 22%). Controlling for age and sex, via regression analysis, reduced the income differential to 1%. This major reduction was due to Arab physicians being markedly younger than Jewish physicians. Further controlling for regional distribution and work characteristics (managerial status, specialty status/type, and months worked) did not change the ethnicity differential, but did markedly reduce the coefficients of the age variables.

The 2022 Arab-Jewish income differential among physicians was due predominantly to differences in age composition. The differential could potentially shrink in the decades ahead, as more Arab physicians reach the ages at which physician incomes are at their highest. However, as part of the effect of age on income is mediated by work characteristics, the extent to which the wage gap will shrink will depend in part on the extent to which Arab physicians will secure prestigious residency training slots and managerial positions. Health system leaders can play an important role in promoting such developments. In particular, steps should be taken to increase the representativeness of Arabs in Israeli medical schools.