Malta’s employment statistics rarely fail to puzzle objective observers of the labour market. This country has one of the lowest unemployment rates in the EU but it also has one of the lowest employment rates.

We have one of the lowest rankings of students that continue their tertiary education, especially in science and technology courses, while, at the same time, we have one of the highest rates of students leaving secondary education without qualifications.

Now another ‘mystery’ seems to be worrying the country’s policymakers.

According to a report that has just been published, about 300 16-year-olds “disappear every year from school and employment records, falling into idleness or the black economy”.

So the political hype about how successful the country is in creating employment needs to be challenged by asking for explanations as to why so many youngsters are falling into a big black hole with very little visibility.

The explanation given by Education Minister Evarist Bartolo is that “the missing teenagers are either living idle lives as dependants on their parents or are forming part of the black economy”. A little research will reveal that the latter reason is more credible even if it does not flatter politicians.

In August 2014, The Wall Street Journal carried a report by Margit Feher on the black economy in Europe. According to statistics quoted in this article and compiled by Randstad, a Dutch human resources consulting firm, the black economy in Malta in 2013 amounted to 24.3 per cent of GDP, that is, one of the highest in the EU and higher than in Greece and Italy.

Admittedly, measuring the size of the black economy in any country is a difficult exercise even if carried out by competent professional statisticians.

But there are enough indications that the black economy in Malta is distorting the dynamics of our official economy and the social services network that is financed by taxpayers’ money.

The statement by the minister that “it is very difficult to keep tabs on these students [who ‘disappear’ from statistics] once they leave school and do not continue their studies” is quite astonishing.

In a small country it is certainly not impossible to undertake tracking studies to determine where those who have left school in a particular year end up. Of course, this assumes that there is the political will not to turn a blind eye forever when confronted with evidence of a vibrant black economy.

One positive development in recent years is the political commitment to encourage young people to continue with their studies or training as well as the creation of employment and start-up incentives and the reinforcing of apprenticeship schemes with the aim of encouraging young people to integrate in the official economy.

The larger the level of social expenditure to prepare young people to join the official economy, the less prevalent the undeclared economy.

Equally important is the need for an honest debate on the effects of the black economy on Maltese society. There are some who argue that as long as young people are working it does not really matter whether they are doing so in the black or official economy.

At the same time, many expect decent public services in health, education and pensions that are financed by the payment of income tax and national insurance. Public finances, while improving, remain challenging in the medium and long-term.

Put simply, the country can no longer afford to lose young people who ‘disappear’ in the black economy.