The Growth Paradox: Malta’s Wages May Have Had The Lowest Increase In The Entire EU
The hourly labour costs in Malta have increased the least in the EU, Eurostat figures show.
Labour costs, which refers to the total employee expenditure of employers, covers both wage and non-wage costs. However, according to the same statistics, just 6.1% of all labour costs consist of non-wage costs, compared to the EU average of 23.7%.
This means that almost 94% of all labour costs are related to wages and salaries
The figures do seem to indicate what has been often suggested; that wages and salaries in Malta have stagnated
The hourly labour costs have only increased from €14.20 to €14.70 in three years, and by just 0.4% in the last year. The other nations to record low increases were Finland (+1.2%), Spain (+1.3%) and Portugal (+1.4%).
In fact, according to figures published by the NSO, the average gross salary in Malta as of the fourth quarter of 2018 was €19,035, down from the €19,076 recorded the previous year.
The construction industry, despite its substantial boom in the last five years, has the lowest labour hourly cost. This is possibly due to the significant number of low-earning workers, both foreign and domestic, that occupy the industry.
While recording higher figures than 11 EU countries, Malta’s hourly rate falls considerably when compared to the average of €27.40 in the European Union (EU) and the average of €30.60 in the euro area.
The figures are all the more worrying when taking into context the substantial inflation that has come with economic prosperity.
In fact, Lovin Malta recently conducted an exercise which found that most people on the average salary could not acquire an adequate loan to purchase an average property in Malta.
The statistics cover enterprises with 10 or more employees (excluding agriculture and public administration).
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