Sri Lanka labour supply to shrink, female workers can fill gap

ECONOMYNEXT – Sri Lanka’s labour supply will decline over the next few decades which will lead to slower growth, but getting more female workers to the labour force will help mitigate the shock, officials said.

Out of the total workforce, only about 35 to 36 percent are women, a phenomenon that has not changed much over the last 20 years.

Sri Lanka has a labour force of 6.67 million.

Changing policies can help ease the entry of female workers into the workforce, World Bank’s Senior Country Economist Fernando Im said at the launch of the agency’s Sri Lanka Devlelopment Update report, which focuses on demographic change. 

Amala de Silva, from the Department of Economics at University of Colombo, said there was also a trend of women leaving the workforce.

That could be due to childcare or elderly care requirement.

However, there is an age cut-off at 40 years, which keeps them coming back to the workforce, she said.

"There are social factors, ‘the perfect mother, perfect house’ and men do not want wives and fiancés to work," de Silva said.

Im said Sri Lanka’s growth has been falling since a boom at the end of the war from 6-8 percent levels to 3-4 percent.

In Sri Lanka, productivity in sectors like agriculture was also low, he said.





In 2018, Sri Lanka was estimated to have grown about 3.1 percent, he said.

Sri Lanka is expected to have more elderly people with the population pyramid narrowing at the bottom.

Getting more female workers into the workforce would help mitigate part of the shock.

Indralal de Silva, a former professor of demographics at the University of Colombo, said Sri Lanka’s population is expected to keep growing into the 2030s.

In 1871, Sri Lanka had a population of 2.4 million, which had grown to 20.4 million by 2012.

Another 4-5 million will be added to the population by 2030, he said.

However, Sri Lanka will experience a ‘youth bulge’ in 2030 due to an increase of fertility in the 2000s, de Silva said.

At the moment, there are about 3.1 million elderly persons, 600,000 of whom receive government pensions. Another 25 to 30 percent are covered by the Employees Provident Fund.

However, the older population will continue to grow and Sri Lanka will have to deal with the challenge by raising the retirement age to 65 years from the current 60 years.

De Silva said the number of people leaving Sri Lanka for work abroad has declined from 300,000 a year levels to 200,000 levels now.

Meanwhile, foreign guest workers are also coming into Sri Lanka. This trend may also increase, he said.

W A Wijewardene, a former Deputy Governor of Sri Lanka’s central bank who is now involved in private sector education, said the country’s education system was certificate- based and students were shunted into segments. (Colombo/Feb14/2019-SB)

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