Malta records EU’s highest employment rate as population growth and service dependence stand out

Malta had the highest employment rate in the European Union in 2025, while also recording the bloc’s fastest population growth over the past decade and its lowest fertility rate, according to Eurostat’s latest Key Figures on Europe report

The 2026 edition of the report provides a snapshot of demographic, economic, labour market and environmental developments across Europe, generally using data from 2024 and 2025.

For Malta, the figures show an economy characterised by exceptionally high employment and a heavy reliance on services, alongside rapid demographic change and continued dependence on migration.

Malta posts EU’s highest employment rate

Perhaps one of the most striking figures concerns Malta’s labour market. In 2025, 83.6 per cent of people aged between 20 and 64 in Malta were employed – the highest proportion anywhere in the EU.

Malta narrowly surpassed the Netherlands, where the employment rate stood at 83.4 per cent, followed by Czechia at 82.9 per cent, Sweden at 81.8 per cent and Estonia at 81.7 per cent.

The EU average, meanwhile, stood considerably lower at 76.1 per cent.

Unemployment was similarly low. Malta and Poland both registered unemployment rates of 3.1 per cent among people aged 15 to 74 in 2025, with only Czechia recording a lower rate, at 2.8 per cent.

The EU-wide unemployment rate stood at 6 per cent.

Population grows by almost a third in a decade

The strength of Malta’s labour market comes against the backdrop of significant demographic expansion.

Between 1st January 2015 and 1st January 2025, Malta’s population increased by 30.9 per cent – the fastest growth recorded anywhere in the EU.

Luxembourg came second with population growth of 21.1 per cent.

Across the EU as a whole, the population increased by just 1.8 per cent over the same decade, with Eurostat identifying net inward migration as the main driver of the bloc’s overall increase. But despite this rapid growth, Malta remained the EU’s smallest member state by population, with around 0.6 million inhabitants at the beginning of 2025.

The demographic figures become particularly notable when viewed alongside Malta’s fertility rate.

In 2024, Malta recorded 1.01 live births per woman, the lowest fertility rate in the EU, compared with an EU average of 1.34.

Spain recorded the second-lowest rate at 1.10, while Bulgaria had the highest at 1.72. All remained below the 2.1 births per woman generally considered the replacement level in the absence of migration.

The combination of exceptionally rapid population growth and the EU’s lowest fertility rate highlights the importance that migration has assumed in Malta’s demographic and, consequently, labour market development.

Malta remains the EU’s smallest economy

In absolute terms, Malta remained the smallest economy in the European Union in 2025.

The country accounted for around 0.1 per cent of total EU GDP, behind Cyprus, Estonia and Latvia, which each represented around 0.2 per cent.

Total GDP across the EU was valued at €18.8 trillion during the year.

Malta’s economic structure, however, stands out for its particularly strong concentration in services.

Services generated 88.5 per cent of Malta’s total value added in 2025, one of the highest shares in the EU and behind only Luxembourg, where the figure reached 89.9 per cent. Eurostat described Malta, together with Cyprus, as a tourism-oriented economy.

The same pattern is visible in employment. Some 84.4 per cent of people employed in Malta worked in services in 2025, the highest share among EU member states, marginally ahead of the Netherlands at 84.1 per cent.

This leaves Malta particularly exposed to developments affecting service-based industries, including tourism, financial and professional services and other internationally oriented activities.

Minimum wage growth among weakest over decade

Eurostat also highlighted Malta in its comparison of national minimum wages.

When minimum wages are expressed in purchasing power standards (PPS), which adjust for differences in price levels between countries, Malta and France recorded the smallest relative increases between January 2016 and January 2026.

This contrasted sharply with Romania, where the minimum wage almost tripled in PPS terms over the decade, while Lithuania, Bulgaria, Croatia, Slovakia and Poland all recorded increases of more than 100 per cent.

The indicator does not measure overall wage growth or household disposable income, but provides a comparison of how statutory minimum wages have developed after accounting for differences in purchasing power.

Economy highly dependent on external energy

Malta also remains particularly exposed when it comes to energy.

Eurostat found that Malta and Luxembourg relied on external supplies for more than 90 per cent of their energy needs in 2024, making them the EU countries most dependent on imported energy.

The EU average energy dependency rate stood at 57.3 per cent.

For Malta, the figure underlines the economy’s exposure to developments in international energy markets, even as domestic policy measures can affect the extent to which changes in international prices are ultimately passed on to businesses and households.