Malta's Budget 2027 should place greater emphasis on improving workplace productivity, supporting employee wellbeing and reducing the administrative burden on businesses, according to Aeroates CEO Giovanna Mirabile.

Speaking to WhosWho.mt ahead of the Budget presentation on Monday 26th October, Ms Mirabile said that Government must strike a stronger balance between supporting employees and safeguarding the competitiveness and sustainability of businesses, particularly small and medium-sized enterprises (SMEs).

"Good people management should not be seen simply as an employee benefit or an additional employer cost; done properly, it should improve productivity, retention and ultimately business performance," she said.

Drawing on Aeroates' work with employers, Ms Mirabile identified rising labour costs, skills shortages, high employee turnover and growing administrative requirements among the challenges currently facing businesses.

"One of the biggest concerns we hear from employers, particularly SMEs, is that labour costs continue to increase while productivity is not necessarily increasing at the same pace," she explained.

"The answer cannot simply be to keep adding people or increasing costs."

Incentivising productivity rather than increasing headcount

Among her priorities for Budget 2027, Ms Mirabile called for stronger incentives to help SMEs adopt artificial intelligence, automation and digital technologies.

However, she stressed that such support should be tied to measurable improvements in productivity rather than simply subsidising the purchase of software.

She also highlighted the importance of investing in workforce development, proposing more accessible and portable training support that would allow employees to continuously develop their skills while helping employers adapt to changing business requirements.

Another area requiring attention, she said, is employee wellbeing.

Ms Mirabile suggested introducing tax incentives or co-funded schemes to make employee assistance programmes, occupational health services and mental-health support more accessible to smaller businesses, which may not have the same resources as larger organisations.

Reducing bureaucracy for SMEs

Administrative costs were another concern raised by the Aeroates CEO, who called for greater digitalisation and simplification of Government processes relating to employment, taxation, permits and compliance.

"Every hour an SME spends unnecessarily on administration is an hour taken away from productive activity," she remarked.

She also proposed reviewing incentives that would allow employers to reward productivity, performance and long-term employee retention without necessarily increasing fixed payroll costs.

According to Ms Mirabile, such measures could help businesses retain skilled employees while encouraging stronger performance and improving their ability to manage employment costs.

Moving beyond employment numbers

Beyond individual Budget measures, Ms Mirabile argued that Malta needs to reconsider how it measures economic success, placing greater importance on productivity rather than workforce size or hours worked.

"Malta needs to move away from measuring economic success mainly through how many people we employ or how many hours we work, and focus much more on the value generated by each hour of work," she said.

She maintained that this shift also requires a different approach to human resources management, where investment in employees is recognised as a contributor to business performance rather than simply an expense.

"People should not be viewed simply as a labour cost to control, but neither can businesses absorb continuously increasing employment costs without corresponding value creation," she explained.

For Ms Mirabile, the long-term solution lies in combining investment in skills, technology and employee wellbeing with policies that allow businesses to remain competitive.

She argued that future Budget measures should be assessed against their ability to help employers create better jobs, retain employees and improve productivity simultaneously.

"Does this help the employer create better jobs, retain good people and become more productive at the same time?" she asked.

"If it achieves all three, we are supporting employees and businesses rather than treating their interests as competing priorities," she concluded.