For the first time since the law in Malta allowed a significant increase in overseas workers in 2013, the Government has outlined a Labour Migration Policy to seek to regulate this important area of Malta’s economy. The policy was released for a public consultation from 8th January to 9th February, and a final version will now be prepared.
Two key changes are proposed in the initial document:
1. Changing investment promotion to shift from supporting projects based on job creation to supporting projects with higher added value and in selected strategic sectors.
2. Focusing on skills creation rather than job creation
Four guiding principles are set out:
· Job retention and stability
· Protection of employee rights and enhanced working conditions
· Aligning labour migration with labour market needs
· A skills-based approach to migration
At the core of this change is reforming the Labour Market Needs Test which will, according to the Government, become as flexible as possible to meet market conditions and also firmer with those who choose to break the rules.
The reduction in the size of the local workforce is attributed to an ageing population and low fertility rates – almost one-third of employees in Malta have come from abroad.
Of the 120,000 jobs created in Malta between 2013 and 2023, around 30,000 were taken up by Maltese nationals, 23,000 by other EU nationals, and 67,000 new jobs were filled by third-country nationals.
Almost forty thousand new jobs were created in the professional and administrative sectors with 27,000 added in the combined category of ‘wholesale, retail, transport, accommodation, and food’ – most new jobs in this second category were filled by third-country nationals (24,570).
Employment of Maltese nationals decreased in manufacturing, mining and construction. Maltese employees continued to be the largest component of the financial and insurance activities, real estate, professional and administrative services, and the public sector.
The consultation also outlines average wage levels, which are lower in the sectors with more foreign workers:
· Financial & Insurance activities – €47,000
· ICT – €41,000
· Arts & entertainment – €37,000
· Public sector, education & health – €32,000
· Professional & administrative – €27,000
· Real estate – €25,000
· Manufacturing – €24,500
· Wholesale, retail, transport, accommodation & food – €21,600
· Construction – €18,500
· Agriculture – €16,400
The major increase in net migration has been relatively recent – reaching over 20,000 people in each year in 2019, 2022 and 2023 with sharp reductions (as expected) during the Covid-19 pandemic.
The number of third-country national employees stood at around 25% of the total workforce in Malta in 2023 but their contribution to the economy was concentrated in the categories of manual labour (30.6% of all third-country nationals), services and sales work (22.6%), and craft and trades workers (10.1%). Only 4.6% of third-country national workers were employed as managers compared to 14.2% of EU nationals.
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