Even though a number of countries are gradually coming out of the recession, joblessness is still giving governments a big headache as unemployment figures persist in remaining at a high level. According to one forecast published just before the end of 2009, unemployment in the industrialised world was expected to hit its highest level since the war, surpassing the current peak.
The jobless rate in the 30 rich countries belonging to the Organisation for Economic Cooperation and Development (OECD) is expected to approach 10 per cent in the second half of the year, a grim outlook by any account. However, according to another forecast, the unemployment rate may in fact be lower than previously thought. Only the months ahead will tell which of the two forecasts is correct. In the meantime, the millions who are out of work are unlikely to get themselves involved in any quibbling over figures. Their concern is how to make a living. Being thrown out of a job is a harrowing experience, though, quite ironically, some manage to make an art of living on the dole.
Malta, too, is passing through a difficult period, as even though the jobless figure may be one of the lowest in the European Union, it is high enough to raise concern and to make the government concentrate, quite rightly, on ways and means to help generate new jobs. At 7,588, the unemployment figure is in fact only about 500 short of what a former Labour government considered as a crisis level, high enough to make it set up emergency labour corps. Those times may well be over but there is still no magic wand to generate jobs overnight.
Growth in practically all countries is still too sluggish to push the jobless figures down. Stimulus packages have helped contain the haemorrhage but of their very nature these have a relatively short duration. Malta's economic growth in the third quarter was far too small to suggest a reliable trend but, according to the Finance Minister, the fourth quarter appears to have registered growth as well.
The minister, Tonio Fenech, said in Parliament the other day that economic growth pointers both in the third and fourth quarters last year indicated that the economy was showing initial signs of recovery. This is good news indeed. If the recovery trend is confirmed by the National Office of Statistics, it would help generate new confidence, leading perhaps to a renewed growth rhythm. Far too often, gloom - generally spread for political ends - tends to feed on itself and overshadows efforts at overcoming difficulties.
As it did in the first round of the rise in utility tariffs, the government has tackled the second round badly as well but, to its credit, it seems to have handled the impact of the recession well when it tailored assistance to the particular needs of the firms hit. In a bid to generate new jobs, it has now come out with a scheme that could well make a significant contribution to the drive to push the jobless figure down.
Very small firms employing fewer than 10 workers, and even the self-employed, are entitled to a tax credit on expenses made to improve their operations or for employing new workers. The importance of this and other schemes aimed at helping small and medium-sized enterprises is readily realised when considering that the sector already employs about 62,000 workers, which, according to the minister, is double that employed in manufacturing.
Funds channelled towards such schemes are money well spent.