A recent cover story in Time magazine promised to tell readers 'Why Europe can't get off the ground'. Inside, the storyline was even gloomier: the article went under the heading 'The lost continent'.
Apart from a photograph of a street protest in Athens and a graph showing government debt as percentage of GDP for Britain, France, Germany, Greece, Ireland, Italy, Portugal, Spain and the US, the thrust of the article was, in fact, about the economic situation in Spain rather than that of the EU or the eurozone. The article then leapt to generic statements such as: "To understand what ails modern Europe, look at the pain in Spain."
I did not expect the article to mention tiny Malta, but concentrating on the Spanish situation, in my opinion, revealed the nature of the spin intended by the writer.
As it happens, one can compare things with the situation in Malta as it results from the Labour Force Survey published by the National Statistics Office on June 30. This is a survey carried out by phoning up people and is self-reported. It is quite reliable as over 3,200 households are contacted over a year and therefore it gives a good indication of economic trends.
The results of this survey show that the first quarter of 2010 over the same quarter 2009 saw an increase of 3,700 in employment. More interestingly, the self-reported average salary has gone up from €13,846 to €14,565 yearly, an increase of 5.2 per cent.
This is not what the Prime Minister or the leader of the Opposition is saying. It is what the interviewed people said. This is a good indication of an economy on the move and, despite the doom and gloom brigade protesting to the contrary, salaries have increased.
The survey shows where we still need to focus: getting more people to work. Ninety per cent of Maltese men aged 25 to 54 are working. But, in the case of women of the same age bracket, only 48 per cent work, though rate of female participation is increasing. Of the working age population, 50 per cent are inactive - neither working nor seeking work.
The harsh truth is that we cannot keep expecting a higher standard of living with most families having just one wage earner. In those countries with the high standard of living that we in Malta aspire to reach, as many women work as men.
We cannot expect a country to live well in a situation where half the population that works have to support themselves as well as the other half that don't work and don't even seek to work.
The mentality of not working and expecting others to pay for non-workers' standard of living stems from a culture that is the result of many factors. Unfortunately, this culture has been fostered partly by the Church and partly also by Labour.
Another statistic published by the National Statistics Office on June 21 is that of the registered unemployed - those people who actually register for work. Assuming they are not moonlighting, these are the people who want a job but cannot find one.
In May the registered unemployed dropped by 554 over the previous month; over the previous year it dropped by 214. This is significant as the drop in unemployment in May was fairly large and reverses the trend up to April when the number of registered unemployed was increasing, albeit slightly.
The registered unemployment rate is now slightly less than five per cent and this is very significant. In many other EU countries the unemployment levels are around 10 per cent, with Spain suffering an unemployment level of 20 per cent. This is in sharp contrast with Malta.
Compare this to the unemployment rate during the milder recession of the early 1980s, when unemployment in Malta stood still at 10 per cent for several years.
Malta has weathered this economic crisis well compared with other European countries - the result of common sense decisions taken in the past, mainly our EU membership and the adoption of the euro that necessitated strong financial governance to qualify for the necessary criteria.
Therefore we were well-prepared to take on this crisis. Moreover, the current administration adopted very sensible and well-directed assistance to factories that were viable in the long run while pruning the dead wood like the dockyard.
The good news, however, comes with a warning: we are not out of the woods yet. The budget deficit goalposts are being pushed further by the EU, which has realised we have all been living beyond our means.
Having got its strategy right, the administration must now ensure it also gets the tactical issues right. The significant delay in the collection of the 'new' water and electricity bills is a major danger. Another is the fact that the share of the beleaguered construction industry in the GDP is still contracting.
Some might consider this as a 'positive' restructuring leading to a decrease of the country's economic dependence on this traditionally strong sector. But that is a long-term view that ignores the pain that this contraction is causing.
micfal@maltanet.net