Malta cannot gamble its competitiveness for election pledges – Malta Employers president

As political parties gear up for a general election, businesses are facing an unusual mix of domestic challenges and international turbulence. For Ivan Refalo, president of Malta Employers, this confluence of events makes prudent economic policy and labour market stability more urgent than ever. In this context, he insists that Malta’s competitiveness cannot be sacrificed for short-term political gain.

“These are truly testing times. Political debates are heating up as parties prepare for a general election, while international developments, especially the conflict in the Middle East, are creating chaos for businesses with a combination of demand and supply-side pressures,” he begins.

Despite these challenges, Refalo points out that Malta’s economy continues to grow. “Growth is encouraging but it also brings pressures, especially on human resources,” he says. “Companies struggle to fill vacancies and competition for talent is intense. More often than not, private firms must rely on foreign workers to keep operations running.”

This, he says, ties directly into the electoral cycle.

“Malta’s competitiveness must be preserved. Political promises must be realistic and affordable. Populist pledges, like offering every type of leave imaginable, might appeal to voters but threaten long-term economic stability and put further pressure on the already increasing national debt. Policy should be evidence-based and sustainable.”

The key word for Refalo is certainty.

“While we have no control on most of the developments taking place around us, we must not fuel further uncertainty ourselves. We cannot afford surprises. Our businesses, workers and economy deserve policies grounded in reality and focused on sustainable long-term growth,” he adds.

He singles out the public sector as a particular concern. “Unfortunately, we continue to see skilled employees attracted away from the private sector for government roles where their abilities are often underused. Not to mention social media adverts that promote public sector jobs under the premise of possibly working less. This practice destabilises businesses and disrupts the labour market.

Refalo frames these concerns within a broader vision.

“We strongly support initiatives such as Malta Vision 2050, which push for sustainable, inclusive and productive growth. Every decision carries an opportunity cost. True leadership requires choosing what serves the nation’s long-term interest. We cannot afford to get it wrong; the future depends on decisions we take today.”

Refalo is particularly concerned about issues related to Malta’s human resources, especially Malta’s labour migration framework. While the policy has been welcomed as a step toward addressing workforce challenges, including skills gaps and the need to attract and retain third country national workers, it still faces practical hurdles, he says.

“We are all for initiatives that help stabilise the labour market and bring in the skills our economy needs,” he explains. “But excessive costs, unclear procedures and under-resourced regulatory bodies are creating unnecessary burdens for both employers and workers. Policies must be workable and enforceable in practice, not just ideal on paper.”

Debates over flexible working arrangements, including the idea of a four‑day week, have also grown. “Flexibility can work,” Refalo says, “but only when it is underpinned by higher productivity, technology, automation and investment in skills. Our researched position shows that most employers do not yet support the idea of a blanket four‑day measure for Malta. Labour shortages, rising costs and operational realities vary across sectors. Work‑life balance is important but solutions must be grounded in the realities of individual firms. At the same time, social dialogue remains non-negotiable. Refalo expressed disappointment at the association’s exclusion from recent government-driven, technical committees related to employment and industrial relations.

“Malta enjoys industrial stability because responsible partners engage in constructive dialogue. Excluding employers from committees discussing employment and industrial relations is unacceptable. Decisions made without our involvement risk imbalance and undermine the process.”

In conclusion, Refalo delivers a clear message: Safeguarding Malta’s economic future requires collaboration, foresight and a refusal to compromise on principles for electoral expediency.

“We stand for policies that drive sustainable growth and which are designed to strengthen the country’s competitiveness. We also stand for the acceptance and practice of core values in the advancement of our society,” Refalo continues while stressing “we are steadfast in our belief that ethical principles provide the foundation for economic and social policies that genuinely serve the national interest. In this light, we have recently commented that public officials must lead by example and demonstrate integrity, transparency and full accountability in the conduct of their duties.”

In this context, Refalo frames the association’s mission as more than advocacy, but one which serves a wider economic cause.

“Our role is to ensure that the voices of employers are heard, that labour policies work in practice, and that long-term growth is underpinned by integrity and ethical employment practice. We are committed to being a constructive partner in making those decisions count.”