The construction sector in Gozo is expected to see a decline in activity, while the arts, recreational and entertainment sectors are anticipating better conditions, a survey has revealed.

The results of the Gozo Business Sentiment Survey noted that business activity on the sister island is expected to be “less optimistic” in the coming six months, while most businesses anticipated stable conditions.

Half of the respondents (50 percent) expect their business environment to remain unchanged in the next six months, while 30 percent of businesses expect a downturn in their business environment. 

The construction sector stands out from all the other sectors- with 40 percent of businesses predicting a decline in activity.

“This indicated a more moderate growth in the construction sector compared to that observed in recent years,” the report noted, highlighting how the figures align with the Gozo Regional Development Strategy’s vision to shift focus away from construction. 

On the other hand, 20 percent of businesses foresee a performance improvement, with more than 30 percent of businesses in the arts, recreational and entertainment sectors anticipating better conditions. 

The survey, published on Friday, was conducted by the Gozitan Regional Development Authority and the Gozitan Chamber of Commerce. The survey was conducted in September 2024, with the findings compared to those published in June 2024. 

Shortage of employees continues to be a leading challenge 

According to the survey, while issues related to a shortage of suitable employees and rising cost pressures remain the top concerns, their significance has "declined".

Data shows that the shortage of employees continues to be the leading challenge for businesses in Gozo, yet notes a drop in the concern. 

In September 2023, over 50 percent of Gozitan businesses said the main concern for their business was the lack of suitable employees. 

The main concerns Gozitan businesses are facing according to the recent survey. Credit: Gozo Business Sentiment

A year later, over 40 percent of businesses now believe the shortage of employees is their top concern. 

Another top concern for businesses is cost pressures. 

Last year, cost pressure was the leading challenge for Gozitan businesses- with over 60 percent reporting it as their top concern.

 Concerns about cost pressures gradually eased, with the issue reported as 22 percentage points lower in September 2024 when compared to a year prior.

Sales slowdown also remains a concern, cited by 24 percent of businesses, a rise of eight percentage points from March 2024.

"It’s worth noting that seasonal factors likely contribute to heightened concerns about sales in the September period, particularly for certain industries," the survey noted.

"In addition to these primary concerns, around 30 percent of businesses highlighted other challenges, including issues related to logistics and infrastructure."

Regarding prices, most businesses reported that they do not anticipate a change in the prices of the products and services they offer over the next six months, with 60 percent of businesses expecting their output prices to remain stable.