Most ultra-Orthodox Jews, a growing percentage of the total population, lack the skills to work in a modern economy, having studied little or no math and science beyond primary school (their curriculum focuses almost entirely on religious texts such as the Torah and Talmud). As a result, more than 60 percent live below the poverty line, compared with 12 percent among non-Haredi Jews. Most also opt out of military service, which is compulsory for other Israelis. The net effect: as the Haredi community expands, the burden of both taxation and conscription falls on fewer and fewer Israelis. Trends towards increased fertility, decreased labor force participation, and increased supply of time to religious studies in the ultra-Orthodox community are explained in terms of the behavior of a “club” that has strengthened its norms of religious stringency in an attempt to brace exclusion. The economic self- preservation of the “club” is akin to the old age security motive of bringing children, where children is a means for parents from their income (female work income, child allowances, and other government subsidies) generating years to their old age unproductive years. The parents to minimize “defection” from the community do not endow the children labor- market skills.
