Maltese workers must get better skills or face job competition from foreigners

More investment is needed in the workers’ skills if Malta’s labour supply is to cater for the needs of the future, which are rapidly changing due to technological advancements, labour market experts said on Thursday.

They warned that, despite improvements in the area, people still weren’t fully appreciating the importance of furthering their education and continuously upgrading their skills while they are in employment.

The pundits where speaking at a business breakfast on Thursday, organised by The Malta Business Weekly in collaboration with the Malta Federation of Professional Associations.

Jobsplus CEO Clyde Caruana highlighted that the rate in Malta of low-skilled workers stood at 38%, one of the highest in the European Union.

“Unfortunately, we still don’t fully realise the importance of furthering our education,” he said, “On average, the Maltese worker has around 13 years of schooling, relative to the 18 years Finnish workers have.”

He said that today’s labour market had to be more agile and dynamic in the face of rapid technological changes.

“We need to ensure that people entering the labour market have adequate abilities to develop new skills,” he said. “In terms of those already in the labour market, we need to have a strategy and a pot of money to invest in the upskilling of people.”

“A lot of money needs to be invested into our labour market as it’s one of our main resources for producing more output.”

Advise Ltd director and former PN MEP candidate Helga Ellul also pointed out the need for the continuous upskilling of Malta’s workers.

“It is very important for employers to give their employees possibilities for growth, in order to retain them. It is in workers’ interest to gain more knowledge. As employers, we need to encourage our employees to expand their knowledge,” she said.

Ellul underscored the need to establish the right structures so as to allow the educational sphere to work much closer with industry. “The fast changes of technology means education is lacking behind,” she warned. “If these two do not come closer, we’ll have a disparity.”

“Some companies don’t afford the people who have the right expertise, and those workers they do afford don’t have the level of knowledge required.”

Ellul went on to say that, since unemployment in Malta is at a record low level, this could lead to people’s drive to learn to fall behind. “Everyone can find a job easily now, so the learning curve falls behind. And this is a challenge, because in the future we’ll have people who are unequipped to undertake the newly created job.”

An employee’s market

Malta Employers’ Association director general Joseph Farrugia said the virtually full-employment situation on the island was changing the employer-employee dynamic, making the labour sector an employee’s market.

“We have an employee’s market now, because it is easy for workers to switch jobs,” he said.

He said this created challenges for employers, because, while a certain degree of turnover is health – since it refreshes the ideas of the particular workforce and leads to more innovation – too much turnover is causing employers to hesitate when it comes to training their employees, out of fear that this would lead to them subsequently looking for jobs elsewhere.

“This can be dangerous,” he pointed out, “Which is why employee-retention strategies are needed.”

He said that wage wasn’t he only factor which kept employees at their current place of work. “More and more today, things like flexible work arrangement and work-life balance incentives are even more attractive to employees than actual wage packages.”

This is making life for managers more challenging, he said, since managers have to now come up with customised solutions which strike the right balance between the needs of the organisation and the exigencies of employees.

Choice between more foreign workers or less economic growth

Caruana also underlined that Malta’s aging population meant that the number of Maltese people of the right age to be in the labour market will keep decreasing.

The only way of dealing with this is by attracting more foreign workers, he said, with the other option being to limit the economy’s growth.

“If we want to maintain a sustained level of output per capita, we need to keep increasing our labour supply,” he said.

“And if we don’t have enough native supply, we’ll need foreigners. So, our sole option is for the quantity of foreign labour to continue to increase, or else we’ll have to limit our economic growth.”