Key Takeaways
- Defense-tech startups in Israel are expanding, with a 20% increase in job openings this year.
- The sector has also seen an 8% rise in wages due to heightened demand for experienced personnel.
- Global investment in defense-tech reached $12.3 billion in 2026, with Israeli startups raising approximately $846 million.
Defense-Tech Sector Thriving Amid Layoffs in Other Tech Fields
A recent survey by Israeli recruiting firm GotFriends highlights a significant shift within the tech job market in Israel. As numerous tech companies announce layoffs to streamline operations amid AI integration, the defense-tech sector is notably expanding, having increased job openings by 20% in 2026 compared to the previous year. Simultaneously, wages in this industry are rising by approximately 8%, reflecting intensified competition for skilled professionals in software, hardware, cybersecurity, and AI.
While tech giants and startups alike are laying off employees, defense-tech companies are demonstrating resilience. Notable companies hiring extensively include Kela Technologies, Xtend, Airis Labs, D-Fend Solutions, and Axon Vision, which now compete for engineers alongside traditional software and fintech firms.
The growth of defense-tech is also affirmed by global funding, with the sector attracting $12.3 billion since the beginning of 2026, nearly double that of the same timeframe last year. In Israel, defense-tech firms have garnered about $846 million, nearing the total amount raised throughout all of 2025. This growth stems from a shift in procurement strategies, with the Israeli Ministry of Defense placing orders with around 800 startups, allowing these companies to generate revenue and enhance their technology in real-world scenarios.
The ongoing conflicts in Ukraine and the Middle East have amplified a need for rapid technological solutions, transitioning from long-term project cycles to immediate developments. This urgency fosters closer partnerships between startups and military needs, expediting the adoption of new technologies.
A key trend emerging from this shift is the rising demand for hardware engineers, distinguishing defense-tech from previous years, where the main focus was on software developers. Today, there is substantial demand for professionals skilled in Python, Embedded C++, FPGA, VLSI, and AI development, along with algorithmic specialists in fields like computer vision.
In terms of compensation, the gap between salaries in defense-tech and other sectors like SaaS and fintech is narrowing. Average salaries in defense-tech are competitive; hardware architects earn approximately NIS 50,000 monthly, while AI engineers and VLSI engineers receive around NIS 45,000. The industry’s appeal now extends beyond salary, as many professionals seek meaningful roles that contribute to national security.
Additionally, a new wave of startups is emerging, often founded by veterans and reservists with firsthand operational experience, meeting previously unaddressed defense needs. These companies are positioned well to attract both investment and talent, solidifying the future of the defense-tech industry in Israel.
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