The number of foreign workers living in Malta today is about 27,000. They make up 14 per cent of the Maltese labour force, a dramatic increase from five per cent only a decade ago. This is a mark not only of the rude good health of the Maltese economy, but also of the effects of the free movement of labour in the European single market.

In a country where economic growth depends so crucially on the increase in demand for and the supply of labour, how Malta manages such a diverse and cosmopolitan workforce is a fundamental prerequisite to the country’s continued economic expansion. Over the past decade, there has been a consistent trend towards a pressing demand for labour which is being met from three main sources: a surge in female participation; later retirement from the workforce; and, overridingly, the influx of foreign workers from EU and non-EU countries.

But the increasing reliance on thousands of immigrant workers raises issues which are not being fully addressed. For example, although the Minister for Tourism has understandably, and rightly, been trumpeting the success of tourism and the contribution of the hotel and catering industries, and the ministers for finance and the economy will be delighted by the undoubted boost to the economy which such a significant addition to the work-force provides, have they stopped to consider what are the social, security and demographic implications for Malta in the long term?

I have been prompted to consider these questions by what I see happening so transparently in the restaurant business. Last winter, the catering industry in Malta generated a most impressive €600 million in revenue. There are about 1,675 catering establishments in Malta and Gozo, nearly 700 of which are fully fledged restaurants.

The catering industry accounts for more than 9,000 people, roughly five per cent of the Maltese workforce. From one’s personal experience, a large number of the restaurants appear to be manned by foreign staff from EU and non-EU countries (technically known as third country nationals), which include asylum-seekers or other African or Asian migrants. Many of the ancillary staff (washers-up and cleaners) appear to be irregular immigrants.

There is absolutely nothing the matter with this in principle. It is clear that the Maltese – while content to own the equity in restaurants (alongside Sicilians) – are no longer prepared to work in this field. Cooking and waiting at table are hard work, involving long hours for fairly low wages. Maltese aspirations have turned elsewhere.

How are we managing the demand for cheap foreign labour which an influx of 27,000 foreign workers in 10 years implies?

But questions need to be asked about the conditions under which foreign EU labour and non-EU third country nationals are employed. It is thought that many of these staff are not paying national insurance as they are paid in cash and not shown on the books, thus depriving the Maltese exchequer of its taxes.

It is also thought that some unscrupulous restaurant owners are helping themselves to the tips left specifically for the staff and arbitrarily only giving them a small proportion of their takings. Sometimes, indeed, these are, in part or in whole, in lieu of their salaries. It is noteworthy that the United Kingdom, which already has legislation in place to protect workers’ entitlement to any gratuities they earn, is taking steps to bolster its existing measures on tipping to ensure sharp practices by restaurant owners are discouraged.

These reports raise concerns not only about the exploitation of an underpaid and vulnerable sector of the service industry, but also endemic lack of enforcement within the tourism industry, specifically the restaurant trade. Genuine restaurant owners who manage their staff in a fair and above board manner consequently suffer from unfair competition. There is clearly a need for the Malta Tourism Authority, working in close conjunction with the Malta Hotels and Restaurants Association, to step in to stamp out such illegalities.

For its part, the Malta Employers’ Association has recently drawn up a position paper with recommendations focusing on how to speed up applications from third country nationals to work in Malta. It is concerned that the current process is too bureaucratic and “is hindering their ability to access much needed human resources”.

While correctly also stressing its condemnation of the exploitation of workers and urging companies to behave ethically in their obligations as employers, the association’s emphasis appears to be almost entirely focused on attracting more foreign workers to Malta to meet our expanding requirements for new labour without any real consideration for the wider, long-term implications for Maltese society or, indeed, the future shape of our labour market.

But there are undoubted security, socio-economic and long-term demographic implications which may not be fully appreciated. It is questionable whether the government has an overall plan – or, indeed, an overall picture of what is going on – which looks ahead to what is happening to Malta’s development and demography in the decades ahead.

Malta’s population has increased in recent years to over 425,000. It is increasing at about one per cent a year. For example, in 2013, the last year for which official figures are available, about 8,500 immigrants arrived in Malta. Of these, 21 per cent were Maltese returned migrants, 37 per cent were EU nationals and 41 per cent were third country nationals. On the other hand, over 5,000 – the majority of these male – left Malta during the year. Of these, slightly more than 25 per cent were Maltese, 40 per cent were EU nationals and 34 per cent were non-EU third country nationals. This left a net addition to the Maltese population of about 3,000. While these figures show that it is unlikely that the current influx of foreign workers – especially those from EU countries – will stay permanently in Malta, about 4,000 a year probably will.

The unbalanced demographic profile of Malta and the socio-economic consequences have been highlighted several times before. Some 18 per cent of the population is aged under 18 years, while 25 per cent are over 60 years old. Malta’s ageing population and the falling birth rate are a major cause of the demographic problem, leading directly to unaffordable health and social services in the medium and long term.

Current demographic trends expose an increasing gap between Malta’s financial resources and ever-increasing social transfers – with an ever smaller segment of the population contributing to such transfers. This is an economically unsustainable situation. While the injection of young, active foreign workers will undoubtedly help partly to alleviate it, there are other social consequences which affect not only an erosion of Maltese culture, but also of Malta’s quality of life.

This is a tiny, over-crowded, densely populated, over-built country. Space for development is inevitably limited. Is the small amount of natural countryside remaining to be built upon? What will be the consequences for Malta’s quality of life?

How are we managing the demand for cheap foreign labour which an influx of 27,000 foreign workers in 10 years implies? Importantly, what happens if Malta’s four-year tourism boom goes bust, or if there is an economic shock to Malta as a result of events outside its control? Are we sleepwalking into problems for which we have no long-term plan?

It is in the nature of Maltese administrations – and the national character – not to look too far ahead, but it is now imperative for government policymakers to address the range of challenges, which a rapidly changing Maltese demography presents.