Greater focus needed on long-term unemployed

In 2010 the Employment and Training Corporation trained 13,600 workers, over 45 per cent of whom either had a job or were not looking for one. But, just as the corporation has been ordered by the Prime Minister to prioritise the 58 workers made redunandant from Selmun Palace Hotel, it should also have similar orders to prioritise the long-term unemployed (LTU), who are the most vulnerable.

Speaking about the corporation’s annual report for 2010 and estimates for 2011, PL deputy leader Anġlu Farrugia said the number of ETC schemes co-financed by the EU had risen by 34 per cent, while those co-financed by the government had increased by just seven per cent. The corporation was clearly functioning with EU funds, but what plans were in place after the EU budget expired?

Dr Farrugia wondered if some ETC government-sponsored sche­mes, such as the Community Work Scheme, had a political function to conceal the real figures of unemployment, and what the EU and the International Labour Organisation would have to say on the matter if this was brought to light.

The ETC’s report on economic activity said only two per cent of the jobs created had been full-time, while 7.4 per cent of part-time workers indicated that this was their primary job. And those two per cent had come from the private sector.

Jobs in construction, transport, communications and hotels and restaurants had decreased due to a fall in people’s purchasing power.

Dr Farrugia sought clarification on the number of employers utilising the ETC’s services, which in the corporation’s report had been put at 2,036 but had been quoted as 3,702 in reply to a parliamentary question. Which was the right figure?

It was shocking to hear that participants in the Community Work Scheme were not entitled to sick leave or vacation leave, and when absent had to make up for the hours lost. They were also paid less than the minimum wage. When he had asked on whether it was time to regularise their position, the minister had replied that these persons had no status as employed but simply as registrants.

Precarious work was increasing, but the government felt no need to see what was happening or if there was any abuse of workers. What was the government’s policy really with regard to workers?

The ETC had a committee to oversee, provide for and promote equal opportunities and conditions of work, and to propose remedial action where these were found to be deficient. Were the Maltese living in two different worlds? Such serious anomalies should be addressed, and quickly. Dr Farrugia said this was the same kind of complicity as the government’s closing an eye to the degrading conditions offered by private contractors, even those awarded government contracts. How dare one call workers under these conditions gainfully employed?

With such an increase in part-time workers in a bid to make ends meet in an ever-increasing cost of living, how could the government expect people to make use of child-care centres? Eurostat said Malta was the worst of the EU27 in increased risk of poverty.

What financial investment was the government ready to make in the ETC? An analysis of all Maltese productive sectors vis-à-vis other EU member states showed that of the traditional economic sectors which had always accounted for major chunks of employment, between 45 and 48 per cent were currently going through great economic difficulties. Only personal services and business activities were experiencing fast economic growth.

Dr Farrugia said that when one compared wages with employment compensation per full-time equivalent, one found that real wages for full-time equivalent had continued to slide between 1998 and 2009. Statistics proved that the level from 2001 showed no growth in full-time equivalent.

Employment could not be created when there was no growth. Between 1995 and 2010 manu­facturing had lost 9,600 jobs, or 36 per cent of all employment, while between 2007 and 2008 labour cost in the sector had risen by 33 per cent. In the same period in the rest of the EU the increase had been 14 per cent, which meant that Malta was less competitive by half.

Even in wholesale and retail, unit labour cost in Malta had increased by 44 per cent in seven years, compared to 14 per cent in the rest of the EU.

Dr Farrugia said the ETC must go into greater development, with a section for regular analytical research to enable preparation for, and safeguard against, whatever was on the horizon. Otherwise it would never understand why full-time employment was not increasing much more.

Precarious contracts or part-time jobs were accepted only to make ends meet, but they were not the right solution.

What the government should aim for was a serious employment policy, looking to much bigger countries with much higher wages that for every production line could increase competitiveness and offer better wages.

The greatest challenge to the economy was to see that Malta had good economic growth that would employ most workers with good skills and good levels of education. Otherwise Malta would end up with low-skilled employees who became redundant or experienced a degrading standard of living.

The role of education in the employment sector was the real point of economic growth. Private investment came along only when the government was seen to be seriously addressing prod­uctivity.

Profits were good to have, but if they were not forthcoming it should not always be the workers to make up for the costs of speculation.

Dr Farrugia said that in the EU27 Malta’s economy lay in 16th place in registered hourly profit of between €7 and €7.50.

If Malta was ready to safeguard employment and create more work, even at the cost of less initial profits, once the economy started to grow it would generate more profits and would inch closer to places like Luxembourg, which had invested in its labour market over the years and now had a registered hourly profit in any sector of €38.17.