A recent survey found that 70% of SMEs believe that Malta is moving in the wrong direction.

The Malta Chamber of SMEs detailed its survey findings from the SME Barometer Q1 2025 and, while the 70% is actually less than the percentage of SMEs that said this in previous quarterly barometers in 2024, it is still significantly high.

This could be for a number of reasons. When highlighting the issues the country is facing, 33% said Malta has a lack of good governance. It was the most common answer, but the second and third most common answers were the level of corruption and overpopulation, followed by increasing inflation. These results show, quite clearly, what SMEs are concerned about, and the government should take note.

SMEs are an extremely important section of Malta's economy, and their concerns need to be addressed. In order to do so, it would require the government to take a much harder stance on scandals once they emerge.

The majority of SMEs, 54%, also said that they aren't sure if it will be a good time to invest in the next 12 months, with 30% saying that it won't be. There could be many reasons an SME might feel the way they are feeling on this point

When asked what the top issues their business is facing, the employee shortage was, by far, the highest answer - with 43% selecting this as one point.

In the observation section of the survey, the Chamber of SMEs said that employee shortages and difficulty in sourcing skilled talent locally are causing disruptions, especially in industries heavily reliant on skilled labour.

This paints a concerning picture. Malta has an overpopulation problem, and debates over the country's economic model have long persisted. Many agree that the population cannot keep on growing at the rate it is. But then, there is this situation, where so many SMEs point to an employee shortage as a main issue affecting them. This is where government direction to help businesses grow into less employee-heavy sectors, or to help businesses in some sectors become better equipped with technology to help reduce the need to hire more workers if they expand, comes in. The reskilling and upskilling of workers are also points which need to be further addressed.

The second and third highest rated issues that businesses said they were facing were unfair competition and excessive competition. There were, of course, other issues including issues with late payments, traffic congestion, and increasing inflation, among others.

In terms of unfair competition, this could refer to a number of issues, including potential distrust in the tendering process, or in how public procurement is carries out. This is something the government must delve deeper into, and solve.

The SME Chamber, in its recommendations, said that government "needs to seriously address issues of unfair competition in its entirety as this is negatively impacting business and their daily operations." It also calls for "Strengthening transparency and anti-corruption measures to increase trust in public institutions," and the reforming of public procurement and tendering processes to make them more transparent, competitive and accessible.

These are all points that the government should heed.