The Malta Independent 12 July 2024, Friday
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Gozo: Employment, skills, and tourism insights

Emmanuel J. Galea Sunday, 7 July 2024, 08:37 Last update: about 7 days ago

Gozo faces unique challenges and opportunities in its economic development. The Gozo Regional Development Authority (GRDA), the Gozo Business Chamber (GBC) and the Gozo Tourism Association (GTA) have conducted various studies to understand these dynamics better. This article synthesises findings from several reports, focusing on employment and skills, the impact of foreign workers, and tourism trends.

Employment and skills in Gozo

The GRDA’s position paper on employment and skills highlights several key challenges in Gozo’s labour market.

·          Low activity rate: A significant portion of Gozo’s population remains inactive in the labour market.

·          The public sector’s high employment rate limits private sector growth, with about 35% of Gozitans compared to 25% in mainland Malta being employed in the public sector.

·          Skill mismatches: There is a scarcity of high-skill job opportunities and an abundance of low-skill jobs.

·          Commuting workforce: Many workers commute to mainland Malta because of limited local opportunities.

·          Aging workforce: Gozo’s workforce is aging, with fewer young people entering the labour market.

To address these challenges, the GRDA recommends increasing labour market participation through detailed analyses and targeted strategies. Enhancing productivity by developing high-value economic sectors and promoting private sector employment is crucial. Addressing skill mismatches through targeted education and training programs and improving access to further and higher education are essential steps.

The role of foreign nationals

GRDA’s report on foreign nationals employed in Gozo reveals a significant increase in the number of foreign workers over the past decade. The number of foreign nationals employed in Gozo rose from 357 in 2010 to 3,079 in 2020, with significant contributions from the UK, Italy, Albania, and Serbia. This influx has been crucial in addressing labour shortages and driving economic growth.

However, foreign workers also present challenges:

·          Housing demand: Increased demand for residential units has driven up property prices and rents.

·          Social integration: The influx of foreign nationals affects Gozo’s social fabric and identity. Marsalforn has turned out to be an arena of night disputes among these foreigners, disturbing the tranquillity which holiday makers usually seek in this summer resort.

·          Infrastructure pressure: The growing population adds pressure on Gozo’s already strained infrastructure.

To manage these challenges, the GRDA recommends conducting a skill-gap analysis to identify current and future labour market needs, establishing an integration hub, and organising intercultural events to promote social cohesion.

Tourism trends

GRDA’s tourism survey provides insights into tourists’ perceptions of Gozo, focusing on their experiences related to arriving and staying on the island. Key findings include:

·          Travel patterns: Most tourists travel with family or friends, with a significant percentage arriving via low-cost air carriers.

·          Duration of stay: Most tourists who stay overnight spend 3-4 days on the island.

·          Accommodation choices: Hotels are the most popular accommodation choice, followed by rental apartments and bed & breakfasts.

·          Key activities: Sightseeing, visiting family and friends, and diving are the primary reasons for visiting Gozo.

The survey highlights Gozo is a preferred destination for short-term stays and offers unique attractions such as Cittadella, Victoria, and Ramla Bay, overlooking Xlendi and Marsalforn. But Gozo also faces competition from other destinations, with some tourists considering alternative locations before choosing Gozo.

The Gozo business sentiment survey

The GBC, in partnership with the GRDA survey, provides real-time data on business performance, expectations, and economic trends in Gozo. Key findings from the first issue (2024 Volume 1) include:

·          Stable business conditions: Around 60% of businesses reported unchanged conditions, while 25% saw improvements over the preceding six months.

·          Employee shortages and cost pressures: These remain primary concerns for Gozitan businesses, mirroring challenges faced across Malta.

·          Positive employment trends: Nearly 40% of businesses increased their workforce, with over half planning further expansion.

·          Strong investment activity: A significant number of businesses made capital investments, with further investments planned, particularly in tourism and manufacturing.

·          Growing awareness of climate change affects among businesses and the need for increased resilience measures. 

Both opportunities and challenges characterise Gozo’s economic landscape. The increasing number of foreign workers has been crucial in addressing labour shortages and driving economic growth, but it also presents challenges, especially housing demand and social integration. According to the survey, Gozo’s tourism sector remains robust, with Gozo being a preferred destination for short-term stays.

During July 2023, both the GBC and GTA held their own surveys regarding the ongoing Gozo trend in tourism and the overall business atmosphere. According to the GTA, almost all the operators were seriously concerned with overdevelopment, leading to the island losing its charm, and would cause both foreign and domestic tourism decreasing. GTA emphasised also that quality needs to be given priority over quantity. The GBC, meanwhile, stated that the primary concern for businesses is also overdevelopment and the Gozitan economy’s over-reliance on the construction and tourism industry.

A year later, this business sentiment survey gives rise to particular concerning issues. First, it seems that there is a common denominator in the GBC and GRDA, which is lacking in the GTA. The GRDA is an authority totally under the inclinations of the Gozo Ministry. So the survey results provide more questions than answers. Why was the GTA not invited to take part in this survey? Maybe the views of the GTA differ from those of the GRDA, such as the revival of the Gozo tunnel issue. How is it that businesses are not concerned about overdevelopment mentioned a year ago? Prior to the last general elections in 2022, Gozo Minister Clint Camilleri pledged a flight link between the islands and proposed converting the existing heliport into a short runway for 9-seater passenger aircraft. The survey failed to refer to this empty pledge. 

To ensure sustainable development, it is essential that the Government immediately addresses skill mismatches, enhances labour market participation, improves infrastructure, and reinforces accessibility. The insights from the GRDA and GBC and GTA reports provide a roadmap for policymakers and stakeholders to foster a resilient and dynamic economy in Gozo. Gozitans expect the Government to implement these targeted strategies and promote social cohesion, without further delay, so that Gozo may continue to thrive in a unique and vibrant region.

Of all the recommendations by GRDA, GBC and GTA in the related surveys above, there is not a single action plan how to execute the way forward. Time is running out, we need to walk the talk!

 

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