Labour participation and social security in the Maltese Islands, 1967

Abstract

Information from the 1967 population census is analysed to test the influence of a variety of factors on the decision to join the labour market and on unemployment. The characteristics of the unemployed are also examined. Among the more important conclusions, we found that labour participation was significantly lower in the Islands than in other countries. We also conclude that low earnings were not an important cause of family poverty as defined by the income guaranteed by social security in 1967. Its corollary is that the benefits paid were very low in relation to earnings. Introducing a retirement condition for men, raising National Insurance contributions, and providing more finance from general taxation led to an unprecedented increase in the level of benefits for all contingencies. Finally we found that economic factors dominated the decision to join the labour force and unemployment, but those not gainfully employed usually had some alternative means of support. Typically the unemployed were young and unmarried, and they relied on their famiiy for support since few are eligible for social security.