The Malta Labour Migration Policy is a much-needed step to address the situation of foreign workers in Malta and the job market in general.
What follows is my analysis on this matter – having started working on this policy while at JobsPlus last year and then continuing to follow its outcome.
In 2013, there were 19,000 foreign workers, equivalent to 10 per cent of our workforce. Over a 10-year period, that increased to 116,000 foreign workers, equivalent to 36 per cent of our workforce.
Throughout this period, there was a record increase in the number of Maltese nationals in the labour market. From a country that once had the second lowest rate of employment within the EU, today, we have the second highest number of people in employment in the EU.
For many years, foreign employees used to be considered as those coming from within the EU.
In 2013, there were six EU nationals for each employee coming from outside the EU, the latter known as Third Country Nationals (TCNs). Over time, that trend started to change. Today, for every worker from within the EU, we have two from outside it (TCNs). The latter are, in their absolute majority, male in the 25- to 44-age bracket.
An increasing number of TCNs were doing manual jobs. Employers are barely finding Maltese nationals to work within these sectors. What was the reason for this rapid increase in the number of TCNs seeking employment in Malta? Today, there is a discrepancy between the number of those entering the workforce and those that are retiring.
1,500 more individuals are retiring than those who are entering the job market. There are several reasons for this: life expectancy has increased; the birth rate has decreased; we have full employment (the unemployment rate is a meagre three per cent, the lowest within the EU); the number of people on social benefits has decreased significantly; and the government has absolutely no intention of raising the retirement age. And, within this scenario, our economy, in the past decade, has grown by a rate of nearly seven per cent. Furthermore, our young people have shifted towards professional careers.
Which leads us to the question of whether we need TCN employees.
In past years, many criticised the employment of TCNs in Malta without putting things into perspective. Those who did so, labelled TCNs as the ‘problem’ rather than looking at them as the ‘solution’. They also ignored the fact that this is a demographic matter as much as it is an economical one.
By time, many started to realise that our economy needed these employees, and the question today is how many more do we need and in which sectors.
The Malta Labour Migration Policy provides answers to these pertinent questions.
Firstly, there is no automatic right of employers to employ TCNs. The policy, however, acknowledges that, due to societal changes, there is the need to have TCNs in Malta but within a regulated context.
We are once again witnessing a situation whereby the government and the competent authorities are key players in this important matter.
This policy ensures that the labour market will remain employer-led within a regulated context- Leonid McKay
It is becoming increasingly obvious that the market, when left to its own steam, causes issues and problems. In this case, the market for TCNs continued to increase, at times with the excuse of economic growth. However, someone would have been paying the price.
Picture this scenario: an individual purchases 40 vehicles at one go, bearing the name of one company in the food delivery sector, stating that the market demands it. Of course, there is a market for them.
If you want a ride to the airport, within five minutes you’ll have a cab waiting for you. What we failed to understand is that, while this seems to imply efficiency, someone is paying the price.
An individual who is not able to purchase 40 vehicles at one go and had his business relying on one private Y-plate and used to make his living over a specified number of hours realised that, to make financial sense, he had to put in more hours, and from eight hours daily he started to clock in 10 or 12 hours.
At the very same time, TCNs started to feel the pressure of the intense workload. It is no surprise then that, last summer, we had a strike by several food couriers. The authorities acted immediately. This is why I believe that this goes beyond TCNs but applies across the board to all employees.
This policy ensures that the labour market will remain employer-led within a regulated context and with a number of measures in place.
The 32 recommendations are intended to ensure a regulated market.
Two recommendations stand out: with each work permit, the employer’s profile with regard to layoffs and terminations within the last few months will be looked at. And payments made to TCNs will be made solely through bank transfer.
Will this policy be a success? The fact that while this policy was being drafted action was already being taken on two sectors is already a positive indication.
Obviously, the objective for further stability is a challenge. Certain types of economic migrations are, by their very nature, unstable, and one will always find those few who try to find loopholes.
However, it is a fact that this leftist policy is intended to ensure a better control of the market while safeguarding employees from exploitation, whoever they are, regardless of their nationality.
This is what the Labour Party stands for: workers at heart; a government that generates wealth and ensures that it is enjoyed by all; and an economy that works for the people, and its employees, not the other way round.
Leonid McKay is chief executive officer of the Labour Party.