Thanks to an Evarist Bartolo link on facebook I came across this article on Maltastar that compares the wages between Malta and Luxembourg taking data from a recent survey based on “average wages” and the Purchasing Power Parity. While it is interesting to look at figures consisting solely of wages as averaged out in relation to how they could be spent in the US it is obvious that a peek at the utility of that same wage in the country where it is earned would give a less skewed picture.
So while Maltastar is busy comparing Malta’s average wage of 1,808 dollars per month to Luxembourg’s whopping 4,089 dollars (top of the world) per month it would do well to look out for other stuff such as the actual cost of living in those countries.
I could not find Luxembourg or Malta on the famous Economist Big Mac Index that is based on the One Price comparison for good. I don’t frequent McD mainly because of my allergy to gluten so I would not know the prices myself. I did found this site called numbeo however that does a cool comparison thingy between states. Sure enough I confirmed what I was suspecting and here are the facts for your perusal.
Just for the sake of perspective look at the rental costs for a 1 bedroom apartment – Luxembourg average is 950€ per month while Malta is 350€. As for buying property in Luxembourg compare the 5500€ price per square metre to Malta’s 2500 €.
This is not to say that Malta’s salaries are great or that prices cannot be more competitive but rather to point out that sticking to comparing wages is deceptive and intentionally portrays a fraction of the picture. Just to give you an idea of how relative the issue is, some unions of the EU fonctionnaires based in Luxembourg have been complaining that the salaries for Luxembourg workers are equal to those based in Belgium even though the cost of living in Luxembourg is much higher.
As in the case of the gas price hike J’accuse’s point is that rather than selective charts to fuel the discontent of the voter what we really need to see is what the political parties gearing up for next election are offering on their programmes so that we may be able to assess if any part of it includes – oh hope – solutions or at least attempts at solutions.
And by the way Varist, the guys at Maltastar COULD make an effort rather than cut and paste Ruth Alexander’s article from the BBC site. Next time you decide to cut and paste you should not leave out this damning assessment on the reliability of the figures:
In truth, the economists at the ILO have had to rely on very patchy statistics. Data is missing for some countries – even a country as large as Nigeria, for example. And also, the economists at the ILO are only counting wage earners.
They exclude huge numbers of people who appear in the poverty statistics but not in the calculations for the average wage – pensioners, children and stay-at-home parents, for example, and even the self-employed.
The number of self-employed is huge. In developed countries about 90% of working people are paid employees, but that figure is lower in many developing countries. For example, in South Asia, where many people are self employed or independent farmers, just 25% of workers are salaried.
The conclusion drawn by Ruth Alexander in her article must not have made for comfortable reading at Maltastar because it defeats the very (loose) point they were trying to make. Maltastar’s selective reporting (cutting and pasting) centred on comparing Malta’s wages with the best in the world. In truth the report concludes that ” that the worldwide level of economic development is in fact still pretty low, in spite of the huge affluence that we see in some places.”
Essentially an uncomfortable truth that the economic pains that are being suffered in Malta are (unfortunately) a symptom of a “worldwide level of economic development”. Sadly for Maltastar and Varist, it’s not GonziPN who is to blame.
8 replies on “Thrifty with Facts”
If the property price difference between Malta and Luxembourg is compared with the wage difference in these countries, the property prices in Malta are relatively higher.
Besides as many tourists who visit Malta often complain, prices in Malta are not cheaper than other European countries.
See also this http://www.maltabulb.com/cost-of-living-in-malta.html
Well, so as per your statistics, the average price difference for the same commodity between Malta and Luxembourg is approx 40% while the salary difference is about 225%. That’s quite a substantial difference, so I fail to see what your point is. People living and working in Luxembourg still appear to have a substantially higher disposable income than the Maltese notwithstanding their higher costs.
Yes, perhaps Evarist Bartolo did give a skewed picture of the situation by not quoting costs along with salary, however by my reckoning his point still stands.
you might want to work on your idea of %ages Etienne.
Pray, do tell.
Well. As refards costs you might want to start by saying that Lux costs are almost 170% of Maltese costs – see that 40% lower doesnt look so mild now. Then there is the not too minor issue of the ILO admission regarding the skewed nature of the wage calculation. Average without self employed to begin with.
No I dont think the point stands because it is clear that in order to attempt to make the point one has to be economic with the truth or thrifty with facts. To get closer to the trith our politicians would have to engage in the ugly nature of current economic conditions acrossvthe board. Relatively speakibg ALL countries arr passing through hard times and the only reason peoplenlike Bartolo will engage in futile comparisons is to point at ghosts.
Not very useful, helpful or visionary if uou ask me. Then again I live in Luxembourg and presumably my opinion counts for 225% more than that of a maltese resident. No?
“Then again I live in Luxembourg and presumably my opinion counts for 225% more than that of a maltese resident. No?”.
Not necessarily. A Luxembourg resident would get a clearer picture of the situation in Luxembourg, while a Malta resident gets a clearer picture of the situation in Malta.
That said, I agree with your article.
I did specify right off the bat that I was taking into account only the statistics you quote in the article, didn’t I, Jaques? I have no idea where you got your 170% figure from as it’s not quoted in the article. But even taking that into account, your disposable income would be greater (even though by not as much as one would think at first glance).
About the statistics being unreliable, they are the only ones we have right now, and they are the ones we are discussing., aren’t they?
I do agree with you that Evarist Bartolo is stretching the truth and I have no love for the man and his methods, but it is still a fact that disposable income in Luxembourg is greater that that in Malta. This during a worldwide economic crisis. Without the economy being in tatters, I would hazard a guess that the gap would be even greater.