The latest statistics on unemployment appears to have made the headlines. The number of persons registered as unemployed with the Employment and Training Corporation in September was 7,223. This is the number of persons in what is referred to as Part I of the Unemployment register. To these one must add those on Part II of the Register. These persons have been placed there as a form of penalty. These include those who lose their job not through redundancy, or those refusing employment or training programmes offered by the ETC.
The Labour Force Survey gives an even higher number of those who are unemployed. This survey includes those who would like to work, are in effect seeking employment, but who for one reason or another are not registering as unemployed with the ETC. These could be, for example, women whose husbands work and who would like to return to the labour market, but would not register for work, given their specialisation and given that they would not receive any unemployment benefit. So, the total number of persons who are effectively out of work, and would like to work, is somewhere around 10,500.
To this number one needs to add a number of persons, mainly in the public sector, whom one could describe as being underemployed. These are persons who are not in a productive job, because there actually is no productive work for them to do. There is really no economic justification for them to receive a wage in their present job, and if the labour market were allowed to operate fully, they would not have a job. These could be persons in low level clerical grades or blue- collar grades, who could either be surplus to the real requirements of their employer or whose work could be done just as well by a machine.
No one can really know how many these would be, but they probably number around 5,000 or 6,000. These would not include those that have a job to do but leave it undone because they could not be bothered or because their vocation in life seems to be to skive off work. Such persons have a productive job to do and should be made to do it at all costs, and cannot be described as underemployed. Anyhow, bundling together the unemployed and the underemployed would bring the total figure to around 16,000.
It may therefore seem that we do have an unemployment problem. However, no matter how staggering this figure looks, it is important to appreciate a number of factors.
The first is that we have been there before. Over the last 40 years we have had situations where the proportion of persons who were seeking employment out of the total number of persons who are of employment age, was higher than the one we have today. At times we managed to get out of such situations either through emigration or by transforming the unemployed into underemployed persons, thus rendering the wage they received as nothing more than a transfer payment. On the other hand, there were also times when we got out of such situations through the creation of productive, sustainable jobs. There is no reason why we cannot do this again this time.
A second factor is the short-term volatility in unemployment figures. Up to a few years ago, they would follow a stable pattern, in that unemployment would rise as school leavers join the labour market, for it to decrease as such persons find employment. Today, there is a stronger link between the level of unemployment and the economic performance of the country or even individual sectors of the economy, thus making the number of persons who are unemployed more volatile.
The third factor is the so-called informal economy. There is still a substantial number of persons who work but are not registered as having a job. These could be Maltese who have simply opted out of the formal economy (for example, women whose husbands work and who have no incentive to pay national insurance contributions and much less income tax), or foreign workers who are working here without a permit.
Moreover, there is an even greater number of persons who have part-time employment in addition to their main full-time job and who do not declare such part-time employment. If all employment were declared and the jobs that foreign workers are doing without a permit is done by Maltese persons, the proportion of people who are out of a job gets even smaller.
The fourth factor is a social one. Today, more and more women are continuing to work even after they have children. One estimate is that the number of women who are married and have an independent source of income (be it through direct employment, or activities like private lessons or hosting foreign students) is above 50 per cent of all married women below the age of 60. This trend is likely to continue in the future. The end result is that whereas before there was an element of turnover in the labour market that enabled entrants into the labour market to find employment more easily, now that turnover is greatly diminished. This would mean that although unemployment may be seen to be increasing, the number of persons who do have a job is also increasing.
To these factors one must add the current international economic slowdown, that has certainly helped to further increase unemployment in the country, and the restructuring that is taking place in the economy. No one doubts that there are a number of opportunities that can be exploited to create more jobs, but somehow there is not yet a common understanding between all the social partners of how to exploit effectively these opportunities. All these factors lead to the conclusion that although unemployment is rising and this is a matter for concern, we do not have an unemployment problem.
Admittedly, the level of unemployment in this country is always an important indicator, for economic as well as social reasons. Let's face it, even if unemployment is down to one per cent, and it happens that you are looking for a job, you would expect someone to take notice of the problem and not ignore it because unemployment would be just one per cent. However, I believe that the issue is overstated. I also believe that the level of employment (rather than unemployment) is increasingly becoming a more important indicator as it provides a more reliable basis for assessing the level of wealth that is being generated in the country.