TEL AVIV, Israel — The construction site, like so many others in Israel, is frozen in time.
Just outside of downtown Tel Aviv, the half-built apartment building has been empty for almost a month: conduits of wires hanging loose from the ceiling, piles of unused rebar rusting, water collecting in dirt around the foundation.
Normally, there would be 20 or 25 workers here, said project manager Bashar Jabareen, a Palestinian citizen of Israel. But on this day in early November, there are only himself and a couple of others there only to keep an eye on the site and make sure nobody has broken in.
Like most construction projects across Israel, work on these apartments has been on pause since Oct. 7, the day thousands of fighters from the Gaza-based militant group Hamas poured across the border into Israel, where they killed about 1,400 people and kidnapped hundreds of others.
Since then, as Israel has mounted a military campaign on Gaza in response, Israeli authorities have indefinitely paused worker permits for Palestinians over security concerns, hitting both Israeli industry and the West Bank's economy.
In peacetime, more than 110,000 Palestinians held permits to work in Israel or Israeli settlements, according to Palestinian officials, the majority of them in the construction industry.
Left without those workers — and without alternative sources of labor, as Israeli reservists have been called to war and many foreign workers have fled the conflict — the construction industry in Israel is operating at 15% of its prewar capacity, according to the Israel Builders Association, an industry group.
"It's a very, very big problem for the Israeli economy," said Shay Pauzner, the association's deputy director-general. "This is one of the places where every Israeli will feel the impact of this war: in his pocket."
And for Palestinians in the West Bank, the sudden shutoff of income has rippled through the economy, as workers struggle to pay their rent, car payments and children's tuition. The longer it goes on, workers say, the more desperate their situations will become.
Both Israelis and Palestinians agreed that the current situation has no comparison to other hostilities between Israel and Hamas in recent years, when the worker permits returned relatively quickly.
Perhaps it could be two to three months before the workers could return, employers and workers told NPR; perhaps it could be never.
"Nobody knows what's going to happen," Pauzner said.
In the West Bank, families buy food on credit, hoping they'll be able to work again soon
A handyman for a monastery in west Jerusalem told NPR he was likely to be replaced if he missed much more work. A metalworker for construction sites in Israel said he was relieved he had paid his daughter's tuition before the war began — if the war lasts too much longer, he said, his family will become lower class.
Like many workers with Israeli permits, construction worker Raed said he chose to work for Israeli employers because the salary is higher. (Palestinian workers in the West Bank gave NPR only their first names due to concerns that Israel could deny them a work permit in the future.)
His Israeli employer pays him 200 to 250 shekels each day, or about $50 to $65, to pour concrete for new homes at an Israeli settlement nearby.
But Raed has been unable to return since Oct. 7, not even to collect his wages from last month. Now, he has no income, he said, with a wife and two small children to feed.
"What can I do? Nobody knows if we're going to go back or not," Raed said. "On a financial level, I am destroyed. I don't know how to provide for my family."
About 13% of all employed Palestinians worked in Israel or Israeli settlements before the war, according to the International Monetary Fund. In addition to construction, many worked in agriculture or the service sector.
Yet even those who didn't work in Israel have felt the impact of the permit cutoff.
At a small grocery store near Ramallah in the occupied West Bank, the store owner, Nasser, constantly watches news about the war as he mans the checkout counter.
In normal times, he allows regular customers to buy groceries on credit as needed. But since the war began, the number of customers asking to make purchases on credit has gone up fivefold, Nasser told NPR, and the amount of money they owe has risen, too.
"When those who work in Israel put their money here, they move the economy," said Mahmoud, an electrician. "But if no one is working in Israel, then we don't get any money here. Everything stops. We're turning on the same wheel."
Mahmoud doesn't work for Israelis, he said, instead preferring to work for Palestinian employers around the West Bank. That has become more difficult in the war, too: Israel has closed roads and checkpoints across the West Bank, making it hard to know how long it will take to commute to a job — or if it will even be possible to do so.
But his biggest problem is that few people have the money to pay him anymore. Those that do have savings are holding their money tight, in case the war drags on, he said.
Asked if he wanted the war to end so things could get back to normal, he answered yes, but only if victory is on the Palestinians' side, and not with Israel.
"This is a sacrifice for the sake of getting at least part of my rights one day," he said. "And no matter how much I sacrifice, no matter the price, it won't be like what my cousins in Gaza are going through."
In Israel, questions about whether Palestinians workers can ever return
For years, the Palestinian work permit program was seen as a way to improve relations between Israel and Palestinians in the occupied territories. Giving Palestinians steady jobs in Israel with reliable income could divert them from associating with radical militant organizations like Islamic Jihad and Hamas, supporters of the work programs said.
"A person who leaves at five in the morning and returns at seven in the evening has no time for terrorism," said Amit Gottlieb, the vice president of Gottlieb Construction, the company whose construction sites near Tel Aviv are paused. "This is a concept that I too believed in."
Palestinians had to undergo a security check every few months in order to receive the permits. During previous conflicts between Israel and Hamas, workers from the West Bank were allowed to return to work with minimal disruption.
But since Oct. 7, political support in Israel for Palestinian worker permit programs has collapsed.
Israel was quick to pull the plug on workers from Gaza; the security cabinet announced last week that "there will be no more Palestinian workers from Gaza." Thousands of permit workers from Gaza who had been stranded in Israel since Oct. 7 were deported Friday.
But the chill on worker permits has extended to workers from the West Bank, who had long been seen as safer than those from Gaza, in part because the West Bank is run by the more moderate Palestinian Authority, as opposed to Hamas, which governs Gaza.
"I am against the entry of thousands of workers from the PA who may endanger civilian lives at this time," said Itamar Ben Gvir, Israel's national security minister, in a post last month on the social media site X (previously known as Twitter) in response to a proposal to allow 8,000 Palestinian men over the age of 60 and women of any age to return to work on Israeli farms.
In Israel, construction demands are significant: Israel's population is growing significantly faster than the worldwide average, and when the war is finished, there will be demand to repair and rebuild homes damaged by the fighting.
The events of Oct. 7, in which Hamas fighters broke into Israeli towns and homes to kill and kidnap people, has Israelis on edge, Gottlieb said.
"This situation has made everyone who hears Arabic fear that there are terrorists roaming around," he said. Some mayors have asked construction companies to close sites out of security fears, he said.
Like almost all Israelis in the construction industry, Gottlieb has worked alongside Palestinians for his entire career. "We have a personal relationship with them, and even these days, I can say that I love them," he said. "I have employees that I know better than my friends."
But Oct. 7 has shaken his confidence in the long-term ability of Israelis and Palestinians to work together.
The dilemma is with him morning, noon, evening and night, he said.
"Is it their goal to live in cooperation with us or to kill us?" Gottlieb asked. "I'm not as sure today as I used to be before Oct. 7."
Alon Avital contributed reporting in Tel Aviv. contributed to this story
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