6 NOVEMBER 2002
The barometer called employment
The ailments, we were told, in an economy are its high unemployment and the cost of living - followed by its investment potential. Yet in todays world these statistics are not the best to go by. The number of gainfully employed may very well be high in Malta and Gozo, but it does not necessarily imply that the economy is alive and kicking. And the opposite is also true.
One will see that the gainfully employed are found in the public sector.
When the public sector does become privatised, it is natural that its staff complement will be forced to come down. Ironically, the surplus workers are invariably always taken up the government itself or a government scheme, which means that the added burden on the tax-payer is retained.
We know for a fact that many companies are overstaffed.
The parastatal companies such as the energy and water companies - EneMalta and WSC - could do with some serious staff trimmings.
And yet politicians from both sides are petrified to take the necessary measures to redimension these companies.
At the end of the day, we would fare so much better if these surplus workers were all given a decent unemployment allowance.
The state would spend less and the companies would be able to provide a cheaper service.
This is only a hypothesis: a combination of bleeding heart politics, attachment to ancient values and the warped principle that everyone is owed a living makes any reform in this sector an impossible task.
When we come to the other important statistic linked to investment, we are fixated with the imaginary concept that investment equals a blonde-haired foreigner walking into a Maltese bank with an open cheque book.
Former Socialist Premier Dom Mintoff in his day would have argued that employment is the barometer of an economy.
But we have to look deeper at the nature of the gainfully employed. Do we have more skilled workers? More self-employed? More professionals, more women and fewer housewives? More youth or more elderly people at work? More graduates and middle-managers? More service-oriented employment possibilities? Better salaries?
This is what the economy is all about.
We have to look beyond what we imagined the economy to be. We must add to the equation what we produce and ask what the multiplier effects are and what activities are generated with employment.
And yet, one revisits year after yea and month after month the same statistical analysis.
Someone somewhere must wake up to the need to reform this statistical misconception. Who will it be?
Good news at last
Finally the markets have reacted to the publication of a financial report. Good news indeed and we need more of this.
What will effectively seal the future for ideal investment knowledge is the presence of independent profiles for investors, carried out by untainted specialists at arms length from the business and financial world.
Perhaps the more established companies of the old world should set up a fund to encourage the establishment of an independent watchdog and analytical group of financial advisors that would dissect the financial and economic status of many of the countrys present and future public companies.
It should provide a looking glass perspective into the thousands who
have shirked at the thought of reinvesting in the stock exchange.