Gozo’s business sector is bullish about its prospects after seeing conditions improve in the past six months, an industry survey indicates.
More than half of businesses surveyed say they are planning capital investments this year and 41% said they expect business conditions to improve in the next six months – the highest such figure since the Gozo Business Sentiment Survey began.
That positive sentiment, however, is threatened by major labour shortages as businesses struggle to find workers to fill vacant roles. More than half of businesses in Gozo flagged a shortage of suitable employees as their most pressing challenge.
The survey, which is carried out at six-month intervals, is a joint initiative between the Gozo Regional Development Authority and Gozo Business Chamber and reflects sentiment as of March 2025. It is the third time the survey has been conducted.
During the six-month period from September 2024 to March 2025, 30% of firms said their business conditions had improved over that period, up from the 20% reported in the previous six months. The percentage of firms that said business had worsened fell to 16%, down from 20%.
Business was especially good for firms in the transportation and storage sectors, with construction and manufacturing firms also reporting good outcomes.
The accommodation and food service sectors, on the other hand, said things were less positive: just 22% said business conditions had improved over the previous six months, versus the 33% that reported a deterioration.
When asked about their outlook for the next six months, businesses were broadly positive.
41% of firms said they expect business to improve, up from the 20% that said that when they were last surveyed in September. Meanwhile, the share of firms which expect business conditions to worsen over the next six months fell to just 9% from 31% in September 2024.
Optimism was especially pronounced within the accommodation and food services sector, which reported a net positive balance of 89%
Employment
More than half of firms in Gozo (58%) say they intend to hire more workers in the next six months and that is reflected across a wide range of sectors. In manufacturing, that intention is especially pronounced – 90% of businesses in the sector say they will increase their workforce in the coming months.
One problem they may face, however, is finding the workers they need.
Of companies surveyed, 53% said they struggle to find suitable employees, with the issue especially acute within the construction and tourism-related sectors.
70% of construction firms and 65% of businesses in the accommodation and food services sector as well as retail trade flagged this as a key concern.
More than half of businesses (55%) say they expect to invest in their business in the coming six months.
The most in-demand skills for workers include those related to tools, machinery, and similar technical areas, alongside competencies in communication, teamwork, and related soft skills.
Prices
Business owners say they expect their input costs to rise in the coming six months – 66% predicted rises in the prices of goods and services essential to their operations. However, an even larger percentage had anticipated price rises when they were last surveyed.
Employee-focused initiatives
While many businesses in Gozo say they offer flexible work arrangements (61%), fewer offer career development opportunities and employee wellbeing opportunities.
Of those surveyed, 24% said they offer skills enhancement initiatives and just 14% said they offered support for employees’ mental health. Many blamed financial considerations and the risk of disrupting day-to-day operations as limiting factors and 70% said they would be motivated to introduce such measures if provided government support to do so.
