State Jobs Anchor Maldivian Employment as Private Sector Relies on Foreign Labour, Report Finds

Malé’s labour market presents a paradox at the centre of the capital’s economy: employment appears strong on paper, yet the structure beneath it points to two workforces operating in largely separate spheres. According to the Labour Force Survey, Malé 2024 to 2025, released by the Maldives Bureau of Statistics on 1 May 2026, the employment-to-population ratio stood at 97.5 percent for foreigners, compared with 64.5 percent for Maldivians. 

The gap reflects more than a difference in participation. It reveals a bifurcated reality in which Maldivians are more likely to be absorbed by the state, while the private sector is sustained by foreign labour. Among employed Maldivians in Malé, 53.3 percent worked in state institutions, including government offices, independent institutions, the judiciary, police and defence, parliament and state-owned enterprises. For foreigners, the pattern is almost reversed, with private businesses accounting for 88.6 percent of employment.

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This raises a structural question for the Maldives: is the economy building diversified pathways for local employment, or developing parallel economies that rarely intersect? In one sphere, Maldivians are concentrated in state-linked work, which often provides stability, social status and predictable income. In the other, private enterprise, particularly in construction, services, trade and related sectors, continues to depend heavily on foreign workers to meet operational needs.

The survey estimates Malé’s working-age population at 188,062 people, including 128,129 Maldivians and 59,933 foreigners. While foreigners made up about one-third of the working-age population, they accounted for 41.4 percent of all employed people in the capital. This reflects the extent to which foreign workers are embedded in Malé’s productive economy, particularly in sectors requiring manual, technical, service and operational labour.

The industry data points to the same divide. Services accounted for 78.4 percent of employment in Malé, while the secondary sector, which includes construction and manufacturing, accounted for 21.4 percent. Foreign men made up 65 percent of employment in the secondary sector, while Maldivians were more represented in services. Within the secondary sector, construction alone accounted for 58.9 percent of employment, showing the importance of foreign labour to the capital’s physical expansion.

For policymakers, the low overall unemployment rate of 2.3 percent may therefore be less reassuring than it appears. The figure is pulled down by the near-total employment of foreigners, most of whom are in the country for work. Among Maldivians, unemployment was higher at 3.7 percent, while labour force participation stood at 66.9 percent. The inactivity rate was particularly high among Maldivian women, at 46.6 percent, pointing to deeper barriers shaped by care responsibilities, social expectations and access to suitable work.

The long-term sustainability of the state acting as the employer of first resort is now a central economic concern. Public employment can provide a stabilising function in a small economy, but it can also mask weaknesses in private sector integration. If many Maldivians see state-linked employment as the main viable route to secure work, the economy risks narrowing the relationship between education, skills and private enterprise.

This matters especially as the Maldives pursues post-pandemic infrastructure projects and wider national growth strategies. Large-scale development depends on timely execution, technical capacity and efficient labour allocation. Yet the survey suggests that the sectors most responsible for physical delivery, including construction, transport and related services, rely heavily on foreign workers, while local employment remains more closely tied to public institutions.

Such a labour structure can slow the transfer of skills, limit productivity gains and leave the country exposed to external labour supply shocks. It also creates a policy contradiction: national growth plans often assume greater Maldivian participation in a modernising economy, but the labour market in the capital shows limited overlap between local employment preferences and the sectors driving expansion.

The challenge is not simply to replace foreign workers with Maldivians. The more difficult task is to create credible pathways for Maldivians into private sector roles that offer stability, progression and dignity, while addressing the social and institutional factors that keep many people, especially women, outside the labour force.

Without that shift, Malé’s economy may continue to look active and productive while remaining structurally divided. The capital can build more roads, towers, offices and infrastructure, but the deeper test is whether the people who live in the economy can meaningfully participate in building it.