Good for the economy: migrant workers pay millions in taxes and bring new skills

EU nationals and other migrants provide high-end skills, work jobs no longer staffed by Maltese, and pay 10% of national tax revenues

Finance minister Edward Scicluna touring the Bettson offices: remote gaming is one of the major employers of EU nationals in Malta
Finance minister Edward Scicluna touring the Bettson offices: remote gaming is one of the major employers of EU nationals in Malta

Immigration has helped accommodate a rising demand for labour in Malta, to the extent that without foreign workers, Malta’s working age population would have declined instead of risen.

Data from the Employment and Training Corporation suggests that the number of full- and part-time jobs rose by 25,500 between 2010 and 2014 – nearly equally divid­ed between Maltese and foreign workers.

Until the 1980s Malta was a country of emigration, but now the odds that a third-country national is employed in an elementary occupation is 4.5 times that for the average Maltese, who instead have benefited from higher skilled jobs.

Malta is now a country that employs foreign workers at either end of the labour market – the higher end where skills are scarce and the lower end where jobs are no longer that attractive for Maltese workers.

Employment by sector and nationality 2014 (ETC data)
Employment by sector and nationality 2014 (ETC data)

Service jobs, sales workers and plant and machine operators remain clear­ly dominated by Maltese workers, but 50% of the growth in EU workers are managers, professionals and technical staff.

Conversely, the proportion of the for­eign workforce engaged in elementary occupa­tions and in clerical & support duties rose from 7.5% in 2000 to 28.3% in 2014. These two trends, a declining share of higher-end and a rising proportion of lower-end occupations differ from those observed amongst Maltese workers.

More impressively, dependence on foreign workers in elementary occupations and in clerical and support duties has risen from 0.5% to 14.1%.

Industry and the public sector are dominated by the Maltese, while for­eign workers are more likely to be employed in other services, mainly remote gaming, profes­sional services and admin­istrative support and in tourism.

Migrant workers are ever present in various jobs, namely ‘other services’ (29% of workforce), 23% in professional services & administrative support, 21% in tourism, 18% in real estate, 16% in information & communication and 13% in construction.

“It is important to emphasise that the fact that a sector is heavily dependent on foreign workers should not be misconstrued as evidence that these have elbowed out Maltese employees,” the Central Bank said, in the study it published in its quarterly review.

What this means was that the Maltese also were main recipients of new jobs: they occupied 50% of new full-time jobs in entertainment during the decade to 2014, and 66% of jobs in professional services.

But in tourism and construction the growth in employment since the 2009 financial crisis was mainly taken up by migrant workers.

Third-country nationals occupied 37% of new jobs in administrative support between 2009 and 2014, 13% of health and social care jobs, and 11% of retail jobs.

Tax data indicates that revenue from foreign workers in the form of income tax and national insurance had risen to 10.1% of some €984 million in 2014, a growth of nine times during the period 2000 to 2014, whereas that from Maltese workers doubled.

Even the use of public hospitals by foreigners shows that this has risen from approximately 1,500 patients in 2008 to less than 2,300 in 2012, less than the growth in the foreign workforce during the time.

Migrants also do not appear to be weighing down on the social benefit budget – with just 130 on unemployment benefits, for instance – this suggests that in addi­tion to their significant contribution towards economic growth, foreign workers have also contributed significantly to improve the state of public finances in Malta.

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