"Since the discussion of doing a postdoc in Israel started up from cost, I want to assure you that Israel in not as expensive as you think. The most expensive place is the central Tel Aviv area and just a few kilometers outside the official Tel Aviv limits an apartment will cost less. That said, there are quite a few foreign postdocs from the Technion or Weizmann who prefer to live in Tel Aviv for the 'scene' and will pay a lot more for the apartment and the commute for it. 35-40K is more than enough for a single person to enjoy themselves. The average apartment will run you 400-1000 dollars a month depending on where you are and maybe a bit more for a good apartment in Tel Aviv. Food is more expensive than in the USA, which is frustrating.
Restaurants are twice as expensive and everything in the supermarket seems to be just a bit more. Fresh fruit however, is a lot cheaper when it is in season. A car is much more expensive, and gas as well. But don't worry about the gas because the country is small and the only reason you'll need a car is if you like hiking or travelling, but chances are another foreign postdoc will have one and you can bum rides is you go to places together. Some universities and institutes have housing for foreign students and postdocs so you can save a lot of money that way.
In terms of science, Israel is one of the top places or so they say, even though there are under ten universities. The Weizmann and the Technion Institutes are tops I suppose, with the former having no undergraduates. But there are some very strong groups in Tel Aviv, Hebrew (Jerusalem) and some in Beer Sheva. I worked for one of the top people in my field in the world, but it always seemed like our labs were old and we were trying to save money. I had no idea why other labs with better facilities were not beating us to these results we were constantly publishing, but those are the breaks. I think it works like that in the big groups in the States too.
My group was typical of a postdoc experience in the States and I think most groups here are like that. Almost every PI here did a postdoc in North America and doing a research sting abroad seems to be a requirement for a faculty job. This is also why every PI speaks English and you need very good English to get a PhD in Chemistry in Israel. You will not have a problem with the language because you can talk in English to everyone in your department. On average, your coworkers will be more mature and of a slightly older age than their North American counterparts due to army service, growing up during the Second Intifada, and the fact that they get married young and probably have their first child when they are graduate students. So they come to work early, don't waste time, and leave by 5 pm and get lots done. There are always exceptions though. Anyways, there might be something to what they say that this sort of experience forces Israelis to take chances and that's why there is a start-up culture and why academic scientists try any crazy thing and then some of those things work and end up published in Science.
There is a vibrant start-up culture, so if your boss discovers anything worth to commercialize, it's a good bet that you'll end up on a patent. I can't speak for the particulars of every institute and lab, but there are technology transfer firms and it's a dream of many young Israelis to work for a start-up and then sell out to some rich American company and become a millionaire. That said, most of the stories about that are in internet technology areas and maybe biotech, but not so much chemistry. MIcrosoft, Google and Intel have a huge presence here, but I don't know how many chemists they hire. I heard that there is a problem with chemistry professors complaining they don't get enough grad students. There are start-up pharma companies and one went out of business recently (because I was browsing through their equipment in a warehouse), but the scene is dominated by TEVA ('Nature' in Hebrew) it seems to me. They do have some original drugs, despite being the biggest generics company in the world. Still, Texas Instruments, Applied Materials and a bunch of others are here. BASF people regularly come to campus for 'consultations' so if you work for a famous boss here, you will likely have good contacts and an Israel postdoc will not be a career setback.
If you have Jewish roots, or manage to marry someone who is Jewish while you are here, then you can immigrate if you feel like it as well. Chances are, it's probably easier to get a science job here doing what you were trained to do than back in your home country, and I'm very sad about that actually. There are a few foreign postdocs that I know who have done just that (Jewish Americans and some Dutch and Germans through marriage).
Chemicals are usually easy enough to get since Aldrich has a huge warehouse here. However, if it's not available and is something special, like a labelled gas, then it can take half a year to get here by ship and most of the time is spent clearing customs. An average American will have no culture or research shock in adopting to the Israeli research environment. That said however, the country itself is very different. Still, if you're not into exploring different environments, you can live in foreign postdoc housing, spend most of your time in the lab, and go to foreign postdoc parties. You'll never learn a word of Hebrew and you can focus on your research. Definitely most of the Indian postdocs here follow this plan. Though if there are a lot of Indians in one place, they will set up a cricket team (there is one from the Weizmann that played in the Israeli league I believe), and have Holi celebrations on campus, etc...
In terms of culture, this is the best aspect for me and it will be hard to leave. If you're an average American, once you are here and talk to local students, they will say something to offend you. This will happen 100%. They will not realize it, and will apologize if you insist on it, but also nobody cares if you are offended. Israelis are very in your face and will ask personal questions half an hour after they met you. Again, personal problems are not that important in the main scheme of things here. There will be Arab Muslim and Christian students as well as Jews, and there will probably be a few Druze in your university, but all young Israelis are like this. Just try not to be offended when someone tells you that you were stupid for not taking a year off to travel in South America or something like that. Once you can get past that, Israelis are very sincere and friendly and they make friends easily.
There are lots of good hikes to do in the desert or in the forests in the north and half the year (or all year if you're from England) you can go to the beach and swim in the Mediterranean. I bought a car and I hike a lot but I'm kind of tired of the beach. Too hot and inactive for me. I prefer swimming in the rivers or in the Sea of Galilee up north. Plus there is no public transit on Saturday so you need a car to get around. I also took my car to the Palestinian Authority areas where you're allowed to go as a foreigner. It's fine and you can buy really cheap groceries there. A lot of the foreign postdocs (especially the Germans of whom there is a ton), go to Octoberfest in Taibeh, a Christian Arab village in the Palestinian Authority, every year.
There are very many different types of Jews (descendants of refugees from Europe, of refugees from Arab countries, immigrants from the Americas) here and all types of crazy people in Tel Aviv. Everyone should have an interesting family and/or personal story. There are lots of clubs there and a very good music scene as well. There is Yemeni music that I learned about here that I now listen to all the time, Balkan music, trance music, and some sort of Italian pop revival. The weather is usually good enough to spend the night on the streets after a cheap concert at one of the trend-setter Tel Aviv music bars (the Ozen bar or Barbie). Go to Jerusalem or spend a week in a cave near Jericho without food like in the Byzantine times to experience your religious awakening if you're into that.
The language is hard to learn and most people give up and don't bother. It's a Semetic language that is close to Arabic and thus very different in structure from English or any other European language. This made it very hard for me to learn despite it seeming easy at first. The roots of the words and the logic between stuff just refused to stick. That said, I put a lot of work in it, and I can now read and speak basic Hebrew and understand medium Hebrew very well. Like in any other culture, knowing a language opens doors where before there was a wall that you felt like you were hitting your head on. I can understand what people say on the street and I don't have to say "Do you know how to speak English?" all the time. The best for me is that I found that the documentary film scene in Israel is second to none and there is a special documentary channel where they show some series that I now love that do not have translations. I loved watching the one about a gay director making a long movie about his life ("On the way home"), the one about "residents of the Tethys sea" (about some really strange everyday people who live in Eilat and how they ended up there), and the latest one I watch all the time is "Families" about five typical Israeli young people and their families, where one of them is an HIV positive man living in London, another is a gay pornstar who wins international awards, an adopted kid, illegitimate son of a famous TV news opinion frontman, etc... I stopped going out to the music clubs in order to watch TV in Hebrew instead now....
The politics in the country and in the disintegrating neighbor countries are also exciting and honestly, I think that's why some of the people come. Some of the German postdocs sounded genuinely excited about the week long rocket war last Fall. The Indians were all horrified. I guess decadent Westerners need to get their kicks somewhere....Thanks to GG for an excellent write-up of life in Israel.