Malta has highest rate of inactive people

The number of inactive people in Malta - those who can work but do not - is the highest in the European Union, mainly because of a very low female employment rate, according to the latest Employment Report issued by the EU.

In 2004 the economically inactive population of working age (15-64) in Malta stood at 41.7 per cent. The average inactivity rate across the EU was about 30 per cent.

The rate of inactivity varied quite markedly across member states, ranging from a low of 19.9 per cent in Denmark to a high of 39.5 per cent in Hungary and even higher in Malta.

According to the EU's Lisbon strategy, a set of economic targets aimed at stimulating the EU economy to become the most competitive in the world, all EU member states have to raise their overall employment rate to as close as possible to 70 per cent by 2010 and to 60 per cent for women.

Malta, the report notes, is still very far from reaching these targets. To do so it will have to raise its overall employment rate by almost 12 percentage points from the current 58.3 per cent.

The situation is even more challenging when it comes to women. Now standing at just 33 per cent, the lowest in the EU, Malta's female employment rate will have to be increased by a whopping 27 percentage points in five years' time in order to reach the target.

The government is trying to entice more women into work by offering tax incentives for returning workers and subsidising childminding centres at places of employment.

Judging by the latest trends, however, the Lisbon target has just become even more difficult to achieve. While in the EU as a whole female employment rates registered a positive trend, last year in Malta the rate declined by one per cent compared to the year before. The only other country reporting a negative trend was Lithuania.

In the EU as a whole, the gender gap in employment has fallen to 15.2 per cent due to the strong rise in the female employment rate. However, a large gender difference of around 25 percentage points or more still remains in Greece, Italy and Spain, while in Malta the gap is around 42 percentage points - again the highest in the EU.

The inactivity rates for Malta are much higher than in Europe despite the high proportion of youths in employment. In almost all the member states the activity rates for youth are well below the average activity rates for the working age population as a whole, with the only exceptions being Malta and the Netherlands. At 47.7 per cent, Malta's youth employment rate is one of the highest in the EU.