Wage growth in retail sector slows but remains upward, report finds

Malta’s retail and wholesale sector continues to face wage inflation pressures, with salaries having increased by between 5% to 6% in 2024, according to misco’s newly released Salaries & Benefits Report 2025. Wage growth is expected to persist this year, albeit at a slightly more moderate pace of 3% to 6%.

The report reflects input gathered from employers in April and May 2025 and covers 88 roles across 13 functional areas. With data representing 5,960 employees—equivalent to 18.6% of the sector’s full-time workforce—the findings provide a highly representative snapshot of current market conditions.

“While the pace of wage growth may be slowing slightly, businesses are still under significant pressure to remain competitive in a tightening labour market,” Director at misco, Lawrence Zammit said. 

“These figures underline the need for retail and wholesale operators to make informed, sustainable decisions about compensation and workforce planning.”

Malta’s retail and wholesale sector remains a cornerstone of the national economy, accounting for 11% of total employment (32,043 individuals) and 12.5% of all registered enterprises. In 2024, it generated a substantial €3.56 billion in Gross Value Added, or 17.16% of the national total.

Despite its scale, the sector is grappling with persistent labour shortages and high turnover, particularly in frontline roles. misco’s research notes that salary bands for such positions remain relatively narrow—largely due to reliance on Third Country Nationals (TCNs), who often have limited bargaining power.

The report also highlights growing competition from foreign-owned supermarket chains and international e-commerce platforms, which many local businesses say is undermining pricing structures and squeezing profitability.

Structural changes are reshaping the sector. By the end of 2024, 1,100 micro-operators closed, while 10 medium-sized firms expanded, reflecting ongoing market consolidation.

Looking ahead, misco forecasts moderate growth, supported by domestic consumption, tourism recovery, and digital transformation. However, cost pressures and labour challenges will require firms to remain agile.

“The sector is at a turning point,” added Zammit. “Sustainable growth will depend on how well companies manage their wage structures while investing in innovation, efficiency, and skills development.”