INTERVIEW | Tomas Mikalauskas: ‘The shortage of labour and resulting wage inflation could become a real problem’

The COVID-19 pandemic resulted in severe labour shortages. Tomas Mikalauskas, CEO of RecruitGiant - a multi-discipline, specialist recruiter of non-EU national workers - explain why Malta remains an attractive destination for jobseekers

RecruitGiant CEO Tomas Mikalauskas
RecruitGiant CEO Tomas Mikalauskas

Many employers in Malta have been expressing concerns about labour shortages since the Covid pandemic struck. What is RecruitGiant’s experience of this issue and how has it affected your operations?

The labour shortage in Malta is very real. On any particular day, here at RecruitGiant, we have at least 500 vacancies available. The impact of the pandemic meant that many foreign workers either returned home or went to look for new opportunities elsewhere. Now that the economy is reopening, there aren’t enough workers around.

The main challenge we are facing in dealing with this situation is that travel remains difficult. This is not helped by the fact that Malta does not accept vaccination certificates from certain countries like India where, pre-pandemic, we had set up training centres specifically to give workers the skills they need to work in Malta. While we continue to invest in training in India and other countries, for now it’s simply impossible for workers to come here.

In the face of this reality, we have shifted our focus to trying to recruit from other countries such as the United Arab Emirates. Malta accepts the UAE vaccine certificate and the fact that working conditions there are very tough means that many people from South-East Asia who live there are keen to find new opportunities.

Nevertheless, leaving the UAE is not that easy so there’s a lot of work that needs to go in to filling any vacancy.

We’re also trying to find workers from other EU countries. Technically it’s much easier for people who are EU citizens or already resident in the EU to move. On the other hand, however, there is less incentive for these people to move as the difference in salary and lifestyle isn’t going to be that great. Maltese are also more than welcome to apply for vacancies on offer, but they never do.

Looking ahead, do you think that non-EU workers will continue to be attracted to come and work in Malta and why?

Malta is, and will remain, attractive to non-EU workers for several reasons. Of course, many of the non-EU workers who do come to Malta are looking for opportunities to learn and improve their skills. For many, the experience of working in Europe can also translate into much better career prosects back home. But these career and economic benefits are not exclusive to Malta.

Malta’s main advantage is the fact that it is English speaking, something which is a big plus for workers migrating from other former British colonies. A hot climate also helps. In other words, Malta offers the benefits of other EU countries but also has a couple of added advantages in its favour.

The recruitment of non-EU workers has also been the subject of controversy, with allegations about illegal employment conditions. Can you clarify how RecruitGiant goes about bringing workers to Malta and what happens after they arrive?

Firstly, I must make it absolutely clear that RecruitGiant does not make any profit whatsoever from workers who we recruit to fill vacancies in Malta, or anywhere else where we operate. We also comply fully with all relevant employment legislation. That means that every worker who comes to Malta through RecruitGiant has all the necessary paperwork in order and has a proper contract of employment, including all statutory benefits. This has been the case since the day we started operating.

As a business we either recruit employees for third parties or we employ people directly and then sub-contract these workers to our clients. Our margins come from the fees we charge clients – i.e. the employers, for filling their vacancies.

The process of bringing non-EU workers to Malta is complex and expensive. On top of the fees due to Identity Malta and other Government institutions, there is the time needed to deal with all the bureaucracy both before and after workers arrive.

On top of this, any new arrivals, who rarely have much money with them, have been spending two weeks in quarantine at a hotel which is not exactly cheap. RecruitGiant carries all these costs and as a result we do charge workers an administrative fee to manage the process of relocation and for obtaining the necessary permits. I can assure you, however, that these fees only cover some of our costs, that each case is dealt with individually and that everyone is treated fairly and transparently.

I would also add that the labour shortages we are experiencing mean that we have seen salaries for many of the vacancies we fill increase by 75 to 100 per cent over the past 18 months. So, the idea that people aren’t being properly paid or not being given their rightful benefits, in our view, does not hold water.

RecruitGiant operates in several other markets apart from Malta. What challenges and opportunities are you seeing in these markets and how do they differ from Malta?

RecruitGiant is based in Malta but we fill vacancies in many countries across the EU. All of these markets, from Cyprus to Latvia and from France to Poland, are facing labour shortages. Obviously in different countries this problem manifests itself differently. For example, on the continent, the shortage of lorry drivers is particularly acute. But the fact is that Europe is an aging continent and every country needs to import labour to keep their economy moving. We simply don’t have enough people to do all the jobs that need doing. The harder it becomes to bring in non-EU workers, either because of the pandemic or because of short sighted political ideology, the greater the threat to Europe’s long term economic prosperity. That, in a nutshell, is the challenge and the opportunity before us.

RecruitGiant has recently received approval from the Government of the Democratic Republic of Congo to begin operating in that country? What are your plans for this new market?

Like many countries in Africa, the DRC has a young population who struggle to find good employment opportunities. Wherever we work we want to ensure that we have all the necessary permits from local authorities and that everything is done properly. With regards to the DRC, we are also talking about a French speaking country. This gives us an opportunity to expand our services to meet demand in France but also other French speaking countries, even in Africa itself where there are more opportunities than is currently the case in the DRC. In fact, right now, the team that we have based in Tunisia is in the DRC to train our new team that will manage our operations there.

Are there any other plans for the future of RecruitGiant that you can share with us?

It’s hard to think about further growth when we can’t even fill the vacancies we have right now. I mentioned earlier that at the moment we have at least 500 vacancies available at any one time. It’s so difficult to bring non-EU workers in that we’re lucky to successfully fill five of these vacancies in a month.

The shortage of labour and resulting wage inflation could become a real problem for Malta, and other European economies, if something isn’t done about it soon.

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