The figures reflect a 3.6 percent increase in unemployment since June, a month before Prime Minister Ehud Barak took office.

Barak's campaign promise to help the disadvantaged was recently called into question by a monthlong strike launched by disabled Israelis seeking more public assistance.

He ultimately acceded to the protesters' demands, but not before he drew criticism for stating he was "not moved" by the strikers' tears.

The statistics were released amid the surprise resignation announcement by Jacob Frenkel, the governor of the Bank of Israel.

The resignation challenges Barak to name a successor whose policies will be in line with the prime minister's pledge to spur economic growth and employment.

Barak has offered the post to Elhanan Helpman, an economics professor at Harvard University and Tel Aviv University. It was not immediately clear if Helpman will agree to succeed Frenkel, whose resignation takes effect at the start of the year.

There are reports that Helpman is inclined to reject the post.

The latest statistics on child poverty spurred children's rights activists to demand special government action, including the creation of a Ministry for Children's Affairs.

"All of these years, we hear the statistics," child welfare advocate Esther Luvohinsky told Israel Radio. "But no solutions are offered for the problems."

She lashed out at the Ministry of Labor and Social Affairs, which she described as "weak, and traditionally has been so."

"The ministers, with a few exceptions, have been concerned primarily with the needs of their own interest groups. They don't get into the problems in depth," she added.

Labor Minister Eli Yishai denied that he is too involved with the political wrangles of his Shas Party to function effectively in his post.

"I would like to remind you that in the previous Knesset, I was the one who brought the issue of children at risk to the Knesset agenda," he told Israel Radio. "We blocked cuts in children's allowances, elderly support — a long list of items — only because of our political power."