Issue link: https://maltatoday.uberflip.com/i/1507818
UPSKILLING our human re- source is essential to level up our economic model and en- hance our competitiveness as a country. Today, we have noth- ing short of 170,000 people in our workforce with a potential for reskilling and upskilling. In addition to that, there's an en- tire generation of highly-skilled employees who are approaching retirement. We need to ensure that the right incentives are in place for these people to con- sider remaining in employment and transfer their knowhow and skills. Malta has one of the lowest unemployment rates in Europe, coupled with the highest level of gainfully occupied employees in our history. Undeniably, this is a strong economic achieve- ment in the face of all the exter- nal shocks our small economy had to face in recent years. This same situation can be seen across Europe, as three out of four SMEs are facing skill shortages on a day-to-day basis across the continent. This was also highlighted by European Commission President Ursula von Der Leyen in her State of the Union address as she hint- ed towards greater access to the European labour market for young people and women in particular. Both locally and at EU level, this extremely tight labour mar- ket is occurring at an important juncture of our economic tran- sition. Now more than ever, we need to level up our economic model, direct it towards quality driven industries and upgrading ex- istent sectors towards higher value-added and a better level of productivity which will en- hance our competitiveness as a country. Rather than shying away from these challenges, we need to grasp every opportunity to ac- celerate this transition by lev- eraging on the best resource we have; our human capital. The value of experience and knowhow Our industry still enjoys some of the most skilful and technical workers, many of whom have a wealth of experience generated through trade school educa- tion and years of hand-on ex- perience in our shipyards and other highly technical sectors. These individuals are rapidly approaching their retirement age, yet their skillset is vital for the development of our economic model. We need to make sure that their talents are retained as long as possible and more importantly we need to make sure they are incentiv- ized to transfer their knowhow to their younger colleagues. Incentivising longer careers Many of these skilled em- ployees have paid enough na- tional insurance contributions that allows them to retire at 61 years. We need to further incentivise these individuals to remain in employment for longer if they so wish. One way of doing this is by allowing these individuals to start earning their pension whilst they keep on working. This will reduce the risk of los- ing such skills from the labour force whilst simultaneously allowing these people to legit- imately increase their spending power. An alternative solution would be to increase further the exist- ent pension top-up mechanism which kicks-in after the official retirement age is reached, usu- ally at 64 or 65. A further increment on this top-up would make it more attractive for these skilled em- ployees to remain in employ- ment. I also believe that the tax burden on these individuals needs to be reduced given that they would have already paid enough contributions to sup- port their own pensions. Mentorship and training Incentives like these should be linked with on-the-job men- torship and peer-to-peer train- ing. This knowledge transfer should be an indispensable feature linked with these in- centives otherwise we would be simply kicking the can down the road for a couple of years until these individuals decide to effectively retire. There is no better way to up- skill people than on the job training provided by experi- enced peers and senior work- ers often possess the invaluable experience that we need for the future. By creating this link between longer careers and mentorship, we would be tangibly strength- ening Malta's future economic growth and competitiveness in key industries. The active involvement of em- ployers and the private sector The private sector has to be in the driving seat of these ini- tiatives. We need to make sure that our companies embrace the transition that is needed. It is in everyone's interest to have a skilled workforce which is well prepared for tomorrow, or todays', business environ- ment. Upskilling and reskilling needs to become a core func- tion in every organisation, in- house training programmes should be incentivised through fiscal incentives but also the academic or technical support needed by these companies. We need to appreciate that companies can only focus on their core business and exper- tise, but the public sector can support training by providing the necessary ecosystem to these private entities. One ex- ample of how this could work is by extending the best prac- tices of the Alternative Learn- ing Programme to in-house training with companies will- ing to provide the technical expertise needed for that par- ticular sector. Embracing this approach re- quires a collective effort to pro- vide the necessary support and create tailored programs. By doing so, Malta can unlock the potential of its retired work- force and build a more sustain- able and inclusive future. Steve Ellul Labour upskilling: An opportunity to boost our economic model 4 maltatoday | SUNDAY • 17 SEPTEMBER 2023 OPINION OPINION Steve Ellul is a financial analyst