Jerusalem remains one of Israel’s most complex cities, but new data published ahead of Jerusalem Day points to a capital that is not only growing, but functioning better by several key measures - even as housing prices, negative migration, and gaps between its communities continue to shape daily life.
The Jerusalem Institute for Policy Research, an independent research institute focused on Jerusalem and its diverse communities, published its annual statistical report on the capital city.
The picture that emerges is not one of simple success or decline. Migration from Jerusalem remains negative, but has improved; construction is at record levels, but prices are still rising; Arab women and ultra-Orthodox (haredi) men are entering the workforce at higher rates, but from low baselines; and residents report growing satisfaction with municipal services, even as some of the city’s deepest questions remain national in scope.
At the end of 2024, Jerusalem’s population stood at 1,050,200 residents, including 997,900 Israeli residents and 52,300 foreign residents. Among Israeli residents, 60% were Jewish and 40% were Arab, according to the Institute’s data.
One area in which the data shows movement is east Jerusalem. Public transportation use in the east of the city rose to 19.7 million ride validations in 2025 - a 12% increase - even as validations citywide fell by 5%. Arab students made up 39% of Jerusalem’s education system, with the Institute noting a rise over the past five years in the share studying within official and recognized frameworks, in part due to a shift from private education.
But Tagel Comay, COO of the Jerusalem Institute for Policy Research, said the strongest sign of change in east Jerusalem is employment, particularly among women.
“When we talk about integration, the place where we see it most - and where it will continue to develop - is employment,” Comay told The Jerusalem Post in an interview on Thursday. “Employment among women in east Jerusalem rose to 33%. That is a lot. It is still not enough, it is still very little, but it is a huge and difficult increase.”
Labor-force participation among Arab women aged 25-64 rose from 23% in 2019 to 33% in 2025. Comay said the shift cannot be explained by one factor alone.
“It is a combination of processes,” she said. “One of the clearest trends is the link between declining fertility and rising employment. In east Jerusalem, fertility has fallen significantly, while women’s participation in the workforce has risen.”
Economic pressures and broader social changes in east Jerusalem
She also pointed to economic pressures and broader social changes inside east Jerusalem, including changes in family structure and the status of women in a largely traditional and patriarchal society.
At the same time, Comay cautioned against reading the data as proof of full integration between east and west Jerusalem.
“I cannot say there is a clear trend of two-way movement,” she said. “That is not the situation.”
The data also highlights Jerusalem’s distinct haredi character. In 2024, 46% of the city’s expanded Jewish population defined itself as haredi, compared with 16% nationally. Only 13% of Jerusalem’s Jewish population defined itself as secular, compared with 44% nationally. In Hebrew education, 64% of students studied in private haredi education, while 36% studied in state, state-religious, and state-haredi frameworks.
Still, Comay warned against assuming that the composition of first-grade classrooms can simply be projected forward into the city’s long-term demographic future.
“When you look at first grade, you really see a huge rise in haredi first-grade classes,” she said. “But when you look at older ages, a different picture emerges.”
One explanation, she said, is that larger haredi families often leave Jerusalem as their children grow older, moving to haredi or haredi-majority cities outside the capital, including Beit Shemesh and Betar Illit.
“I would not look at education and first grade and say, this already tells us the whole demographic future,” Comay said. “It is not that simple.”
Rather than describing Jerusalem as a city dominated by one group, Comay described it as “a city without a majority.”
“It is not like Tel Aviv, where there is a clear secular majority and all the rest are smaller groups,” she said. “Here, even though there is a high percentage of haredim, when you also look at Arabs and the other Jewish populations, there is no clear absolute majority of one population.”
That, she said, is part of what makes Jerusalem compelling.
“There are all kinds of populations of all kinds of sizes,” she said. “It is not one population that is the largest and sets the tone. That is what makes this city so interesting to me.”
Haredi men’s labor-force participation also rose from 44% in 2019 to 51% in 2025, according to the Institute.
Asked whether that pace is enough for Jerusalem’s economic needs, Comay said, “It is always not enough. We always want more prosperity, more economy, more businesses, more new businesses.”
But she added that Jerusalem also shows economic resilience, particularly in business survival.
“Business survival is a very important measure,” she said. “It is important that new businesses open, but it is also interesting to see how many businesses hold on, especially in the past few years of all the crises we have experienced.”
Jerusalem’s housing data tells a similarly mixed story. By the end of 2025, the city had issued building permits for some 8,200 housing units, amounting to 10% of all permits in Israel. Construction began on approximately 6,900 apartments, an all-time high, and 4,100 apartments were completed.
Yet housing prices continued to rise, and the construction boom has not yet translated into immediate relief for residents.
“Construction and housing processes take time,” Comay said. “The prices we see now reflect years of insufficient construction in Jerusalem, which created very high demand and very low supply. The city is building now, but the gap has not yet closed.”
She said the Institute expects expanded supply to eventually affect prices, though the impact will depend on where housing is built and for whom.
“We expect there will be a decline in apartment prices, because as there is more supply, it will take time,” she said. “It very much depends on which areas it will be. These are things the data cannot tell us now; we will see it in a few years.”
Migration is one of the city's biggest challenges
Migration remains one of Jerusalem’s ongoing challenges, though the trend improved in 2024. Some 11,500 residents moved into Jerusalem from other localities, while 19,500 left for other localities, leaving a negative intercity migration balance of 8,000. That was an improvement from negative balances of 11,300 in 2023 and 15,500 in 2022.
The broader migration balance also improved, standing at negative 6,500 in 2024, compared with negative 9,800 in 2023. At the same time, the number of Jerusalem residents leaving Israel remained high, at about 5,200 in both 2023 and 2024, compared with 1,500 in 2022.
Still, the Institute’s data shows residents reporting higher satisfaction with life in the city. According to the Central Bureau of Statistics’ social survey, 81% of Jerusalem residents said they were satisfied with their residential area in 2022-2024, compared with 74% in 2018-2020. Some 65% rated the municipality’s performance as good or very good, compared with 43% previously, and satisfaction with cleanliness rose to 63%, compared with 42%.
Comay stressed that these are CBS surveys, not municipal polling.
“Satisfaction with the conduct of the municipality and with services has risen significantly,” she said.
She said those findings should not be treated as proof that Jerusalem’s problems have been solved, but they do suggest that residents experience the city as more functional than its problems alone might indicate.
“Are these the solutions to everything? Clearly not,” Comay said. “There are real deep problems here, some of which require more work and municipal work, and some of which require national decisions, really. The eyes of all of Israel need to be on this city for it to succeed in all this complexity.”
Some of Jerusalem’s challenges, she added, are not only municipal, but national by definition.
“Jerusalem is also a capital city,” she said. “There are issues here that are national. If a decision is made about east Jerusalem one way or another - even where you send a garbage truck is also a national issue. Not everything is only local.”
For Comay, the current data does not show a city in collapse, nor a city whose challenges have disappeared. It shows a capital absorbing pressure, changing unevenly, and continuing to function through complexity.
“The people here are surviving, and you see the resilience,” she said. “Those who are suffering now are the people who know how to manage, Israelis who can deal with everything - and that is something very Jerusalemite in my eyes.”