While the majority of the country’s main social partners agree that Malta is inevitably moving towards the high-end of the manufacturing industry, such as IT and pharmaceuticals, the two main unions have called on the government to introduce retraining before the workers lose their jobs.

The Chamber of Commerce, the Federation of Industry, the Malta Employers Association, Unjoni Haddiema Maghqudin and the General Workers Union have given their reactions to an interview with Investment, Industry and Information Technology Minister Austin Gatt that was published in The Malta Independent last Monday.

In the interview, Dr Gatt said that with “Malta’s standard of living and working conditions, we cannot sustain low added value industries any longer. We have to have the courage to aggressively attract companies which operate in such a high added value sector and other industries where our cost structures are still competitive.”

He went on to add that Malta forms part of a global economic reality where low added value companies are moving to low cost countries.

The minister also pointed out that Malta’s economy is in transition and not one without pain – especially since many families had been affected by the loss of jobs.

Unjoni Haddiema Maghqudin (UHM) secretary-general Gejtu Vella pointed out that this is the reality Malta is facing.

“There is no ceiling – we are constantly moving ahead and changing,” he said.

Globalisation and the move towards the higher end of manufacturing is a process that will ensure good working conditions and profit for all those who work, added Mr Vella.

He pointed out that foreign companies come to Malta because they believe that they can reap a good dividend and profit – “and this is true”.

However, on the issue of retraining, Mr Vella said that the government is in a good position to “know what is going on and to take remedial action at the appropriate time.

“The government must pre-empt the closing down of a factory and provide retraining from before and not after the factory is closed down and the employees are made redundant,” he said.

“Furthermore,” said Mr Vella, “we have to realise that each company that opens in Malta has a time span for how long it will stay, and take action accordingly”.

However, General Workers Union secretary-general Tony Zarb called for more research and innovation for the whole manufacturing sector in Malta.

“Italy, for example, has a strong industry of textile manufacturing thanks to the intensive research they carried out,” he said.

On the subject of the move from the low-end to the high-end of manufacturing, Mr Zarb pointed out that it will be a challenge to prepare and retrain workers to find a job in the pharmaceutical or IT industry.

Like Mr Vella, the GWU secretary-general called for retraining to be held before a factory closes and not after.

“Right now, what redundant employees need is a job and not retraining as, unfortunately, they will not be paid for their retraining,” he said.

Malta Employers Associa-tion director-general Joseph Farrugia pointed out that the MEA has been calling for a restructuring of the economy to face globalisation challenges.

“It is evident that the economy will have to pass through a process of shedding jobs in areas in which the country cannot, because of its living standards, remain competitive, and attract investment in areas where a higher skill input is required,” he said.

This is what is happening in Malta, and it is the only way in which the aspirations of the Maltese people can be realised, he added.

He echoed Dr Gatt’s words and said that such a transition can be painful – especially for those who lose their job.

However, he said, this pain can be minimised if the transition is, as far as possible, eased by, for example, providing alternative employment that can be allocated to those affected.

Mr Farrugia said that the labour force has to adapt to changing requirements in the labour market, while employers also need to accept new forms of work organisation to satisfy the needs of their clients and attract new employees.

He pointed out that even though retraining depends on services offered by the government, private agencies and employers, it primarily depends on individual motivation.

People will only realise the need to constantly invest in their employability when they realise that the concept of a job for life is a thing of the past, said Mr Farrugia.

“I believe that there are many opportunities around to learn or upgrade skills, and therefore employees can be more proactive in managing their careers. This change in attitude is a key factor in reducing structural unemployment. The worst scenario we can have is to have thousands of job seekers on the one hand and unfilled vacancies on the other,” he said.

A spokesman for the Chamber of Commerce said that it has been pushing both the authorities and the business community to seek new areas in which Malta can compete with the rest of the world.

“The comments by Dr Gatt are only a reflection of the recent trends in the global economy and there is no doubt that Malta has to look for high value added industry, not only because our standard of living requires it, but also because emerging economies are competing very aggressively in the low added value industries sector,” he said.

The chamber has always insisted that the solution in cases where factories close down and employees are made redundant is education and re-training.

“Ultimately it is up to the people themselves to be open to change, in order to adapt as quickly as possible to the ever-changing demands of the labour market,” he added.

Federation of Industry

director-general Ray Muscat pointed out that it is very sad when a sector has to reduce the number of jobs, regardless of the magnitude of the loss.

“It is also true that the textile sector has shrunk over the years, but this is a consistent trend in European countries as it is very much dependent on labour intensive operations in which these are no longer competitive – this is the reality,” said Ing. Muscat.

However, he added, this does not in any way mean that the manufacturing industry is on the way out.

“Manufacturing still has a dominant contribution to the economy – it creates stability, has a huge multiplier effect and could be a medium for re-absorbing such redundancies,” he explained.

As with other sectors of the economy, manufacturing re-invents itself and transforms into higher value added activities through re-investment and higher productivity, said Ing. Muscat.

However, he said, continuous investment in the retraining of people at all levels, and life-long learning, is an imperative.

He also expressed his satisfaction at the government’s immediate reaction to identify the best possible measures to be adopted to retrain redundant employees, especially since there was no short-term warning of the redundancies.

“Perhaps more pro-activeness could be adopted in the case of the traditional sectors, with respect to the identification of the skills of employees, with the aim of offering long-term retraining opportunities for other economic activities,” said Mr Muscat.

However, he added, education and the retraining of the workforce is a long-term and continuous objective.

The government has tried to fulfil this objective by setting up the Malta Council of Arts, Science and Technology (MCAST) and the expansion of the University, he pointed out.

“Nevertheless, we are in talks with the relevant authorities to identify the areas where skills are needed now and in the future, to ensure that the educational facilities are in place to meet this demand,” said Mr Muscat.