A new economic analysis says Israeli-founded companies are quietly propping up a big slice of California’s workforce, backing more than 20,000 jobs and pumping billions into the state’s economy. The numbers land at an especially tense political moment, following Governor Gavin Newsom’s recent public criticism of Israel’s leadership. For Californians in tech, life sciences, or the service jobs wrapped around those sectors, the report is a blunt reminder that global startups are directly tied to local paychecks.
The 2025 California–Israel Economic Impact Report, commissioned by the United States–Israel Business Alliance, identifies roughly 367 Israeli-founded firms operating in California. Based on 2024 data, those companies directly and indirectly support about 22,650 jobs statewide, according to the United States–Israel Business Alliance.
Aaron Kaplowitz, president of the alliance, told the New York Post the study underscores the depth and resilience of the California–Israel economic relationship. He also pointed to the cutting-edge innovation Israeli founders bring into local industries.
The report breaks down the economic impact in raw dollars as well. Israeli-founded firms generated an estimated $8.9 billion in economic output for California and contributed about $6.5 billion in value added to the state economy. The alliance’s analysis also estimates those companies produced roughly $4 billion in wages and earnings for workers across the state, according to the United States–Israel Business Alliance.
Where the jobs live
Most of the action is clustered in the Bay Area’s tech corridors and Southern California’s growing startup hubs, where Israeli founders have planted R&D centers, sales teams and U.S. headquarters. Those ties, sometimes described as a bridge between "Silicon Valley" and Israel’s "Silicon Wadi," are especially visible in cybersecurity, AI, mobility and cleantech. The Bay Area Council Economic Institute has documented these overlapping sectors and long-standing cooperation between the regions, which helps explain why the jobs stack up in a few concentrated pockets.
Politics and timing
The report’s release comes just as Governor Gavin Newsom has drawn fresh attention for questioning Israel’s direction. On March 4, Newsom said that the current leadership in Israel is walking us down that path toward what some call an apartheid state. The Guardian recorded his remarks, which have sharpened the debate over how strategic ties should be weighed against human rights concerns.
Why it matters to Californians
For state policymakers and business leaders, the report is another data point showing that economic links with Israel translate into local payrolls, tax receipts and R&D spending. The findings complicate simple talking points on any side of the argument: job creation and innovation are concrete, but so are the political and ethical questions now playing out on national stages.
Local economic-development officials and elected leaders are likely to lean on the report as they decide how hard to court foreign founders while responding to vocal constituents. For workers and regional planners, the takeaway is straightforward: global startup networks increasingly shape California’s job market, and fights over foreign policy can ripple all the way down to who gets hired, who gets laid off and which regions grow.
