Malta to get first in-depth study into construction industry

The Malta Developers Association (MDA) and accountancy firm KPMG this afternoon signed an agreement that will see KPMG carry out a “scientific study” on all aspects of the construction industry. The study was being sponsored by HSBC, BoV and APS.

Speaking at the signing of the agreement at Castille, in the presence of Prime Minister Joseph Muscat, MDA president Sandro Chetcuti said that the study will seek to determine the number of people employed in the industry, both directly and indirectly, and will also attempt to quantify the demands of the industry in the coming years.

“We are against over supply. So far we have always operated on the basis of gut feelings but this must now be substantiated using solid information,” said Chetcuti.

He said that ultimately, the study had been motivated by the MDA’s desire for a more professional industry.

A representative from KPMG pointed out that the firm had wanted to be part of a study such as this for a long time.

“In developed markets, those interested in construction have access to data and reports which they use when forming their investment decisions,” he said.

He pointed out that the study would focus on two main aspects: the economic impact of the sector and the market on the whole and the trends that define it.

As regards the sector’s economic impact, the study will explore factors such as the industry’s added value to the economy, the number of jobs created, the type of investment being attracted and how this is being financed. Environmental aspects related to the industry will also be explored.

The second aspect of the study will feature an analysis of market trends, identifying what creates the demand for construction, how the industry is affected by people’s lifestyle changes and the affordability of housing, especially in the first time buyers’ market.

On his part, Muscat said that it was incredible that no such study had ever been carried out in Malta, adding that the study will be crucial for bankers and investors in order for them to better judge the risks they get exposed to when financing investment in construction.

“The study will help the industry move away from gut feelings and instead push it to start making use of empirical data,” he said. “If properly done, this study can act as a benchmark for the whole industry.”

He praised the MDA for being constructive and looking past the current boom and towards the future.

Muscat acknowledged the industry’s contribution to the country and said that for it to remain crucial, construction must seek to become a sustainable existence and not a haphazard one.

The construction industry’s workforce requirements

Muscat said that the study would also provide the government crucial information on the workforce required by the sector, and which already risen by 9%.

The Prime Minister welcomed the fact that the government would also gain new insight into the numbers and skill sets required in the industry.

“This information will also guide policy such as our policy on immigration,” he said.

Muscat said that he wished the industry to evolve and that the government wanted a greater focus on safety in construction and for the workforce to be properly trained.

He announced the government would be shortly issuing a tender for the running of a job brokerage centre, which will be coordinating the employment of migrants.

“We want to move past the roundabout job market and this office will allow individuals to buy services in a regulated manner and in a way that gives both the worker and the employer more certainty,” Muscat said. “This will ultimately guarantee better quality jobs for Maltese people.”