OECD Maps Malta's Skills Future with 30 Reforms to Boost Growth, Talent and Investment

The OECD's National Skills Strategy outlines a long-term roadmap to help Malta address skills shortages, strengthen lifelong learning, and align education with future labour market needs to support sustainable economic growth. With 30 policy recommendations spanning 2026–2035, the strategy aims to boost productivity, attract investment, enhance workforce competitiveness, and provide a model for governments, development partners, and businesses navigating digital and green transitions.

Malta's latest National Skills Strategy is more than an education reform, it is an economic development roadmap designed to prepare the country for a future driven by artificial intelligence, digital transformation, climate action and changing labour markets. Developed by the Organisation for Economic Co-operation and Development (OECD) in partnership with the Government of Malta, the National Skills Council, Transport Malta and the European Commission under the European Union's Technical Support Instrument, the report presents a long-term plan to strengthen workforce skills, improve productivity and support sustainable economic growth. Rather than treating education and employment as separate policy areas, the strategy links skills development directly with innovation, industrial policy and national competitiveness.

Malta begins this journey from a position of strength. Over the past decade, educational attainment has improved, early school leaving has recorded one of the sharpest declines in the European Union, and adult participation in lifelong learning has reached EU targets. The country's labour market is equally strong, with an unemployment rate of just 2.7% in the third quarter of 2025, compared with the EU average of 6%, while its 3.3% job vacancy rate in the fourth quarter of 2025 was among the highest in Europe. Malta is also projected to experience the highest employment growth among EU member states by 2035. However, the OECD warns that these achievements hide persistent challenges. Around 36% of Maltese adults have low skill levels, compared with the EU average of 25%, while students continue to perform below OECD averages in mathematics, reading and science. These weaknesses, combined with skills shortages in emerging industries, could limit Malta's ability to attract investment and move into higher-value economic activities.

Building a Workforce Ready for Tomorrow's Economy

The report proposes 30 policy recommendations across eight priority areas to create a more responsive and future-ready skills system. One of the most important proposals is establishing a Malta Skills Observatory, which would monitor labour market trends, forecast future workforce needs and provide policymakers with reliable evidence to reduce skills shortages before they become critical.

The OECD also recommends creating a unified national system for skills assessment and forecasting, supported by sector-specific studies and employer-level analysis. This would help education providers adapt courses to meet future demand in digital technologies, artificial intelligence, sustainability and advanced manufacturing rather than relying on outdated labour market information. A stronger evidence base would also improve public investment decisions and help align workforce planning with Malta Vision 2050 and the country's Smart Specialisation Strategy.

Lifelong Learning Moves to the Centre of Economic Policy

The strategy argues that lifelong learning should become a key driver of economic competitiveness rather than simply an education objective. While adult participation in learning has improved, access remains uneven. Only 8% of adults with lower education levels actively search for learning opportunities, compared with 39% of people with tertiary education, showing that those who need new skills the most often participate the least.

To address this gap, the OECD recommends launching a nationwide lifelong learning campaign, expanding financial incentives for adult education, strengthening recognition of prior learning and introducing universal career guidance services available throughout a person's working life. It also calls for greater investment in teachers through professional development programmes, competency frameworks and leadership training for school principals. The report encourages stronger promotion of vocational education and training, alongside greater emphasis on digital, green and transversal skills such as creativity, critical thinking and communication.

Why Businesses and Development Partners Should Pay Attention

The report identifies employers as central partners in building Malta's future workforce. Many businesses, especially small and medium-sized enterprises, provide less employee training than similar firms elsewhere in Europe because of limited resources and concerns about staff turnover. The OECD recommends exploring legislation supporting workplace training, expanding mentoring programmes, improving access to professional trainers and providing businesses with practical tools to identify workforce skills gaps.

For the private sector, these reforms could improve productivity, innovation and competitiveness while helping firms adapt to technological change. Businesses operating in advanced manufacturing, digital services, financial services, maritime industries and green technologies are likely to benefit from a larger pool of highly skilled workers. At the same time, companies may need to increase investment in employee training to remain competitive in an increasingly knowledge-based economy.

International development partners also have an important role to play. The report provides a structured framework that aligns with broader European priorities on digital skills, green transition and labour market resilience. Development institutions can support Malta through technical assistance, capacity building, workforce forecasting systems and investment in lifelong learning initiatives. The strategy's phased implementation between 2026 and 2035, supported by monitoring and evaluation mechanisms, also provides a practical model that could be replicated by other countries facing similar demographic and technological challenges.

A Long-Term Blueprint for Inclusive Growth

Malta's future economic success will depend not only on creating more jobs but also on ensuring people possess the right skills for rapidly changing industries. By strengthening labour market intelligence, modernising education, expanding lifelong learning, encouraging employer-led workforce development and improving policy coordination, Malta can enhance productivity, attract high-value investment and build a more resilient economy. For policymakers, the strategy offers a practical roadmap for aligning education with economic priorities. For development partners, it creates opportunities to support institutional reforms. For businesses, it highlights the importance of continuous workforce investment. Together, these reforms position skills as one of Malta's most valuable assets for achieving sustainable and inclusive economic growth over the coming decade.