Almost two-thirds of businesses in Malta say that their work is being held up because of skills shortages in the labour market, according to a new Eurobarometer survey published this week.

The study, which surveyed 252 employers throughout May, lays bare the problems faced by employers in finding suitably skilled workers.

In total, a staggering 87% of employers say that they have trouble recruiting staff for at least one role in their company because applicants are either not sufficiently skilled or because there are too few applicants.

The EU-wide survey ranks Malta second only to Austria in terms of concerns over recruiting the right people and significantly higher than the EU average of 74%.

A further 80% say it is either “very” or “moderately” difficult to find workers with the right skills, while 55% say they have difficulty retaining employees on their books.

This appears to be true across workers of all skill levels, ranging from those in management and professional roles, to skilled trade workers and manual labourers.

According to 13% of companies, it is difficult to hire people in management positions because applicants tend not to have the required skills, while a further 14% say that there are too few applicants to choose from in the first place.

Both these figures are lower than the EU average of 7% and 9% respectively.

Companies say they face similar challenges when trying to recruit for professional, technical and administrative roles.

Companies struggle to grow, turn to non-EU workers

The survey suggests that these challenges are holding companies back and preventing them from growing their business.

Aside from the 62% who say that their business has been held back by skills shortages, over half say that the lack of a skilled workforce is preventing them from investing in green business practices, and just under half say that they are struggling to adopt digital technologies in their business.

Faced with these challenges, however Maltese companies appear reluctant to increase salaries to attract higher-skilled workers.

Just over one in five businesses surveyed in Malta say they try to make the job more attractive by upping the role’s pay or perks, significantly lower than the 32% of companies across Europe that adopt this approach.

Instead, Maltese companies appear to be more likely to invest in training and to turn to the non-EU job market to fill these gaps, compared to their European counterparts.

A quarter of Maltese businesses say that they have recruited non-EU workers, either to work in Malta or to work remotely from outside the EU.

Only companies in Portugal, Ireland and the Netherlands say they have recruited third-country nationals more frequently.

While 29% of Maltese companies say that it is “not difficult at all” to recruit workers from outside the EU, a further 21% say that they do not recruit third-country nationals because they lack institutional support or guidance on international recruitment procedures.

A survey carried out by the Malta Employers' Association earlier this year found that almost a quarter of businesses say that half their workforce is foreign, with three-quarters saying that employing foreign workers was the way to deal with labour market shortages.  

Skills gap history

This is not the first time that the skills gap in Malta’s workforce has been highlighted.

A 2022 EY survey found that two-thirds of Maltese companies are unable to find workers with specialised skills in Malta’s labour market.

According to NSO data, more than half of Malta’s workers are in a job that does not match their level of skill or education.

In 2022, NSO launched Malta’s first skills survey, aiming to shed light on the skills profile of Malta’s workforce. An initial report from the survey was published in June, however more results are expected to be released over the coming months.

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