Minimum-wage earners in Malta amongst likeliest to endure material deprivation

Across Europe minimum-wage workers are much more likely to live in materially deprived households, but that percentage is higher in Malta than in most other EU member states, particularly those with considerably higher minimum wages.

Data published by Eurofound, an EU agency for the improvement of living and working conditions, shows that 15% of minimum wage earners in the EU live in materially deprived households, compared to 6% among the rest of employees.

Yet in Malta the same data shows that 21% of minimum-wage earners in Malta live in materially deprived households, compared to just 5% among the rest of employees.

Material deprivation is defined as the enforced inability, rather than the choice not to do so, to pay unexpected expenses, afford a one-week annual holiday away from home, a meal involving meat, chicken or fish every second day, the adequate heating of a dwelling, durable goods like a washing machine, colour television, telephone or car, being confronted with payment arrears on mortgage or rent, utility bills, or loans: items considered by most people to be desirable or even necessary to lead an adequate life.

Across countries, the extent of employees affected by household material deprivation varies greatly: from above 20% in several central and eastern European Member States (Romania, Hungary, Bulgaria and Croatia), Greece and Malta, to below 10% in the Benelux countries and Germany.

While in Greece over 45% of minimum-wage earners live in material deprivation, in Luxembourg and Netherlands only about 5% of workers in the same category live in material deprivation.

This suggests that countries with a higher minimum wage have the least percentage of such workers living in poverty.  Luxembourg, for example, has a monthly minimum wage of €2209 and the Netherlands a minimum wage of €1685 compared to Malta’s €785.

Material deprivation captures the capacity of the household to afford several items considered desirable to enjoy adequate living standards, such as being able to pay the rent, keeping the house warm, facing unexpected expenses, going on holidays, and having a washing machine.

The Eurofound study also shows that across Europe women are over-represented in the minimum wage bracket.

This is reflected in a higher percentage of minimum wage earners among female employees (8.7%) than among male employees (5%), and women account for more than 60% of minimum wage earners. In contrast in Malta, slightly less than 50% of minimum-wage earners are women but one still finds a higher percentage among female employees (5%) than among males (4%).

In almost every Member State, more than half of the total number of minimum wage earners are women – in some countries, this rate reaches two-thirds, for example in Slovakia, Czechia, Belgium and Latvia. This is because women are more likely to work in these lowest-paid sectors and occupations.

In 2019, around 7% of employees in the EU were statutory minimum wage earners – that is, earning no more than 10% above or below the minimum wage rate in each Member State. Across countries, this rate ranges from 10-15% in several central and eastern European Member States (Romania, Poland, Bulgaria and Lithuania) and Portugal to less than 4% in Czechia, the Netherlands and Slovenia. In Malta circa 5% of workers fall in this category.