Small businesses tell government to ‘make up its mind’ on foreign labour

Chamber of SMEs says businesses are dealing with a labour shortage, yet government wants to close the tap on foreign labour

The Chamber of SMEs tells government to make up its mind on how it will deal with the local labour shortage
The Chamber of SMEs tells government to make up its mind on how it will deal with the local labour shortage

Government must make up its mind on whether to close the tap on foreign labour, the Chamber of SMEs said on Friday, with businesses complaining of an employee shortage that can only be solved by bringing foreign labour to the country.

Speaking at the launch of the SME barometer, the Chamber of SMEs said the government must give a clear vision of where it wants to go when the finance minister delivers his Budget speech next Monday.

“Everyone wants to change the economy, but the most worrying thing right now is the inability to find workers,” Chamber president Paul Abela said.

He said the government must make up its mind on whether it wants to put the brakes on the amount of foreign workers coming to Malta.

Indeed, according to the chamber’s SME barometer, employee shortage is the biggest issue being faced by local companies right now. Over 40% of business that responded to the barometer survey said that this was the biggest issue. Inflation is the second-highest concern among companies.

There was increased concern in certain areas, with the largest increase in traffic congestion. Other areas of increased concern are unfair competition, constant upgrading, and access to finance.

When businesses were asked what’s driving inflation in their own companies, around 55% put the blame on employee wage and salary costs. The second driver of rising prices was the costs of products coming from abroad.

Corruption tops concerns

During the survey, the chamber asked companies which two issues are the most important areas that the government must work on.

The two biggest issues reported by companies were corruption and lack of good governance, with around 37% of respondents citing them as important issues.

These were followed by inflation increases at around 32%, and overpopulation at around 27%.

Malta heading in the wrong direction

Moreover, 80% of respondents said that Malta is heading in the wrong direction. This is an 18 percentage point increase compared to the same survey carried out in the second quarter this year.

Abigail Mamo, the chamber’s CEO, said that businesses need government direction to understand what sort of companies are needed in Malta, and which economic pillars to build on.

There is also an uncertainty among businesses as to whether the next few months will be a good time to invest in their companies. Around 52% of business said they were unsure whether to invest, while around 30% responded no.