The assumption that the prevailing tight labour market is the result of our economic progress is somewhat simplistic and at best needs to be conditionally qualified.  Of course, there is a strong correlation between the labour market, or what some would term as human capital, and economic growth.

Yet, the true consideration for our real progress within this context is not just in our ability to keep unemployment levels low, but in our ability to ensure the most productive employment levels possible. The issue of minimising underemployment is also a key consideration.

There is no argument that human capital affects and drives economic growth. After all, it is human capital that can help develop an economy by expanding the knowledge, competence and skills of its people. However, if we truly uphold the vision for a quality leap in Malta’s labour market, we cannot ignore the stark realities between the acute labour shortages within the private sector and the overstaffed complement within some areas within the public sector.

Do we have a growing working culture problem within segments of our labour market? Why are we experiencing some shifts in employment from the private to the public sector? Is this incentivised by the expectation that one can work less? Is this partly being triggered by political vote-catching?

All this is certainly not conducive to improving our productivity, decreasing our ability to compete on the world market, with employers having to resort to more foreign labour, with all its social implications and issues. How do we address this? We should start by raising our standards of recruitment for the public sector and by employing less numbers, and so, releasing workers for the private sector to employ.

Measuring and benchmarking productivity and the setting of performance targets needs to become second nature in both the private and public sectors. Improving our overall productivity is key and placing our limited human resource to the most productive use is of fundamental importance in achieving a strong and vibrant economy.

Here it is highly pertinent to refer to the very timely and highly appropriate statement made by the Malta Chamber on Air Malta. Of particular significance is the highlighting that the airline’s predicament should be seen as an eye-opener for the management of public entities and the rationalisation of public expenditure.

The finance minister pronouncing himself open to the Malta Chamber’s idea of seconding Air Malta workers to the private sector, as opposed to guaranteeing alternative employment within the public sector, is certainly most welcoming, even if somewhat reactive. Ideally, we need more of a proactive approach which anticipates and effectively promotes our vision.

Why are we experiencing some shifts in employment from the private to the public sector?- Norman Aquilina

Here, one cannot help sense that the government and the private sector are not totally aligned on the extent of the sensitivities and effective execution of this vision. Indeed, the statement made by The Malta Chamber, which was subsequently also made by the Malta Employers Association and the Malta Hotels and Restaurants Association, seems to reflect this.

Today’s situation within Air Malta is the cumulative result of diverging pressures between political exigencies versus Commercial necessities.

The public reaction on our national carrier’s state of play has provoked a broad debate on several aspects, one being on the size of the workforce and their job security. Here, I believe that more than job security, we should be focusing on employment security. What’s the difference one may ask? The former refers to a worker’s confidence that he/she retains a specific post, while employment security refers to being able to quickly find alternative productive employment.

This also brings along considerations on employability. That is, taking into consideration workers’ skills, competences and capabilities, not to also mention one’s attitude and willingness in seeking alternative employment. Likewise, with respect to what some refer to as flexicurity,  a term that combines both job flexibility and job security in which the emphasis is on the realisation that job flexibility is not a monopoly of employers and neither is job security a monopoly of employees.

Looking at the bigger picture, let us not overlook the now well-escalated public debt brought about as a result of the significant social and economic impact that the pandemic placed on public expenditure. With government assurances that this public debt will be appropriately addressed through economic growth, as opposed to increases in taxation, the importance of this growth materialising cannot be under- emphasised, and more so, cannot be taken for granted.

Clearly, the key challenge here is not so much the soaring public debt but more the policies adopted, and action needed to manage and sustain the economy from growing out of any possible debt distress.

Therefore, if we want to put in place an effective vision as contemplated within our National Employment Policy 2021 – 2030, to have a “policy designed to enable and support employers invest in their business to employ more and better paying jobs”, government, employer bodies and unions need to be more aligned in the related  thinking, strategic direction and, most of all, execution. This is a primary prerequisite if we truly mean and aim to have a National Employment Policy “to support the country on its path towards the future”.

Norman Aquilina is CEO of Farsons Group.