Israeli businesses have helped to create more than 20,000 jobs in the Golden State, and generate billions in economic growth, according to a new study released after Gov. Gavin Newsom blasted Israel as an “apartheid state.“
An independent study released Wednesday found that Israeli-founded companies play a significant role in California’s economy.
The 2025 California–Israel Economic Impact Report, commissioned by the United States–Israel Business Alliance, identified 367 Israeli-founded companies operating in the Golden State.
“This report underscores the depth and resilience of the California-Israel economic relationship,” said Aaron Kaplowitz, president of USIBA.
“Anchored in Silicon Valley, Israeli-founded companies bring cutting-edge innovation to California, support tens of thousands of jobs, and reinforce the state’s leadership in the global tech economy.”
Those companies collectively generated $8.9 billion in economic output in 2024, while contributing $6.5 billion in value added to the state economy, the report found.
Researchers also estimated the companies support about 22,650 jobs across California, producing roughly $4 billion in wages and earnings for workers.
The analysis also highlights the role Israeli startups play in the state’s technology sector.
Among the companies operating in California are 32 “unicorns” — privately held firms valued at $1 billion or more — that maintain either global or US headquarters in the state, the report said.
Researchers say the relationship between California and Israel has grown over decades as Israeli entrepreneurs expand into the world’s largest technology hub.
“Israel’s emergence as a global innovation leader has intersected powerfully with California’s role as the world’s premier technology economy,” the report’s executive summary states.
The report comes as Gavin Newsom has faced backlash over recent comments, including calling former President Trump’s strike on Iran “illegal” and criticizing Israeli leadership during a recent interview.
“The Governor has platformed narratives advanced by America’s enemies,” Beverly Hills Councilmember and three-time former Mayor John Mirisch said after the governor’s comments.
“California was once a national leader in holding Iran accountable, becoming the first state to ban Iran-linked companies from government contracts. Now its governor is lending credibility to the regime’s talking points.”
During an appearance on Pod Save America, Newsom was asked by host Jon Favreau about Israeli Prime Minister Benjamin Netanyahu and the direction of Israeli politics.
Newsom referenced commentary from Thomas Friedman of The New York Times, saying some analysts warn Israel could be moving toward “sort of an apartheid state.”
“It breaks my heart, because the current leadership in Israel is walking us down that path,” Newsom said, when asked whether the US should reconsider aspects of its military relationship with Israel.
At the same time, the new economic report emphasizes that ties between Israel and California remain deeply embedded in business and technology networks.
The report notes that Israeli entrepreneurs often choose California as their primary US base because of its concentration of venture capital, global technology firms and world-class universities.
