Inactive and unemployed

We need economic growth, not only to create new jobs for the 8,277 who register as unemployed but also for other thousands of persons who can work but are staying away from jobs. While traditionally we have tended to focus our attention on rates of unemployment, we have been ignoring the high rate of economic inactivity among our population. Only 59% of our population aged between 15 and 64 are engaged in an economic activity. This is lower than the 62.6% employment rate that the 25 states who will form the newly enlarged European Union next year.

Our biggest problem is the low participation rate of women in the job market. Only 31.6% of our women aged 15-64 are actively involved in the economy. The average female employment rate of the 25 EU countries is 54%. It is essential to do much more to get unemployed and inactive people into employment.

More jobs are needed not just to improve the quality of life of our families but also achieve a viable balance between the working age and dependent population. A sustainable welfare state and good quality public services need a prosperous economy and as many people as possible in jobs that create wealth.

Our unemployment and inactivity rates are below the present EU average and considerably distant from the 2010 targets the EU set itself in Lisbon three years ago. The Lisbon 10-year strategy aims at making Europe the world's most dynamic, knowledge-based economy, with full employment, better jobs, respect for the environment and safeguards for social rights.

By 2010, if Malta is not to fall behind other EU states, thousands of new jobs have to be created for the unemployed and the inactive. The EU has set itself the objective of having a 70% employment rate by 2010 and a 60% rate for women in the 15-64 age bracket. Over the next seven years Malta would have to achieve very strong economic growth to be able to raise the rate of the active and employed among our population from 59% to 70% and for women from 31% to 60%.

Where is this strong economic growth going to come from? How can we reverse the increasingly difficult present situation with public and private debt growing, public and private savings declining and the main sectors of the economy stagnating and shrinking? We need to create the conditions for new economic growth that allow for new productive jobs in the private sector that reduces the ratio of government debt to the wealth created in Malta and Gozo by our products and services.

A strategy for jobs and growth

We need to address the following key issues:

¤ Can Malta really attract serious foreign investment given the current business environment, taxes, government-induced costs, wages, prices and economic structure, skills base, administrative costs and the prevailing social and political culture?

¤ What is being done to regain our competitive advantage in tourism, manufacturing and services?

Our islands can only start to recover if we keep public spending down by cutting down on waste and corruption, making taxes affordable and maintaining a good standard of government to deliver good quality public services.

We must introduce a diversity of working patterns, including part-time, that provide people with choice and the opportunity to combine work with family responsibilities. We must remove disincentives for employers to create new jobs for women, young people, unskilled workers and people with disabilities. We must provide ongoing training and lifelong education to ensure that more people have the necessary skills to make them employable.

Not only do we have too many people unemployed and inactive, we also have too many early school leavers. The rate of 18-year olds in education is still low (60%). And we have very few graduates in mathematics, science and technology (at 3 per 1,000 of population we are at the bottom of the pile in Europe, only higher than Albania and Macedonia).

All this is worrying as citizens living and working in the knowledge-based society and economy of the 21st century require higher education qualifications and more advanced core competencies and skills if they are not to be excluded and marginalised.

The Party of European Socialists has just published a document where it sets out a comprehensive new strategy to create five million jobs, boost economic growth and protect the environment. The strategy is built on three commitments:

¤ An active welfare state with greater potential for growth;

¤ Quality public finances that promote sustainable growth and social cohesion; and

¤ Policy co-ordination and national implementation, with special emphasis on the EU enlargement countries, among them Malta.

The Malta Labour Party will be promoting this strategy in Malta as well over the coming months. The Nationalist Party in government is quick to pay lip services to policies announced at the European level but then forgets them in practice when it comes to national policy-making and implementation.