HUMAN RESOURCE IN SRI LANKA - HIGHLY SKILLED
LABOUR
Sri Lanka produces a large number of skilled
professionals ranging from vocational/Technical
grades to professional categories, for a wide
range of industries in particular to cater to
the Construction, Apparel, Engineering, IT,
Marketing, Medical and Finance segments. Sri
Lanka’s labour force is known in the world to
have more competencies, a belief stemming from
the Free Education System in Sri Lanka and
literacy rate of over 90 %
9,790 public schools enroll approximately 4.2
million (Education Guide Sri Lanka – 2nd
Edition) out of which around 90,000-98,000
obtains the minimum requirements for admission
to universities. The universities each year
produces around 14,000-15,000 graduated, with
degree ranging from Natural Sciences to
Management and Finance to Arts and Humanities.
The demand for Professional study course has
increased, which is evident from the increased
involvement of the private sector, most offering
internationally accredited study programs in Sri
Lanka. This segment is generally also conversant
in functional English.
The Technician and Lower grade skilled labour is
produced largely through the Public sector
Educational institutions with an annual pass-out
of 33062 of students. The segment lacks basic
proficiency in the English language, if
corrected could yield a high profitable segment.
Household population, Labour force and Labour
force participation.
(Click on the image to enlarge)
In 2005, labour productivity, estimated on the
basis of annual value addition per employee, was
Rs.138,300 per person, which is the highest for
the period 2001 to 2005. The increase in overall
productivity was mainly due to the significant
increase in productivity in the Agriculture
sector and a marginal increase of productivity
in the Services sector in 2005 compared to 2004.
In contrast, productivity in the Industry sector
declined in 2005 compared to 2004. This was a
reversal of the general increasing trend since
2000. This decrease had a dampening impact on
the overall productivity. Although there was an
improvement in productivity in the Agriculture
sector, it remained around half or even lower
than the productivity in the Industry and
Services sectors in 2005. Further, the low level
of productivity in agriculture has remained
throughout the period 2001 to 2005.
Labour productivity by major economic sector
(Click on the image to enlarge)
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There was a significant decrease in the number
of strikes in the plantation sector in 2005
compared to 2004. This indicates an improvement
in the relationship between employers and
employees. A major reason for this improvement
could be the gradual move towards collective
agreements adopted for wage bargaining. The man
days lost due to strikes in the rest of the
private sector was significantly high in 2005
compared to 2004. This was mainly due to the
threeday strike in the Regional Transport
Companies involving around 40,000 workers in the
first quarter of 2005. The remainder of the year
experienced a somewhat calm labour environment
with only 28 strikes taking place involving
around 5,900 workers. The improvements seen in
the employeremployee relationships, except for
this one-off strike, is an encouraging sign.
Further improvements in labour relations could
lead to productivity improvements in the entire
private sector.
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The labour force, the sum of employed and
unemployed persons, is estimated by the
Quarterly Labour Force Survey (QLFS) conducted
by the Department of Census and Statistics (DCS).
However, owing to the tsunami, the DCS could not
conduct the QLFS quarterly in 2005 due to the
absence of a sample frame in the
tsunami-affected areas of the country and
involvement of DCS officers in tsunami related
surveys in the first half of 2005. Instead, with
the availability of a new sample frame by mid
2005, the DCS conducted one Special Labour Force
Survey (SLFS), which covered the entire country,
in August 2005. The SLFS consisted of 4,300
households from non-tsunami areas and 1,050
households from
According to the SLFS, the labour force, which
is defined as persons who are aged 10 years and
above, and able and willing to work, increased
to 8.14 million persons in August 2005 compared
to 7.98 million persons in the third quarter
2004.7 In 2005, the increase in the labour force
was moderate compared to 2003 and 2004, in which
years the sample coverage expanded through the
inclusion of the Eastern and Northern provinces,
respectively. Further, the loss of lives due to
the tsunami devastation at the end of 2004 also
restricted the increase in the labour force in
2005. The labour force consisted of 7.52 million
employed persons and 0.62 million unemployed
persons in 2005.
The labour force participation rate (LFPR)8,
increased to 48.3 per cent in August 2005 from
47.8 per cent in the third quarter 2004. This
increase was mainly due to the increase in male
LFPR to 67.1 per cent from 65.7 per cent in the
third quarter of 2004. Meanwhile, the marginal
decline in female LFPR over the same period had
a dampening impact on the overall LFPR. The
gender disparity, which showed the male LFPR to
be twice that of the female LFPR over the years,
continued in 2005 as well. Further, the LFPR of
43.0 per cent in the tsunami-affected areas of
the country was somewhat lower, as could be
expected, than in the rest of the country. It
was also lower than the historical levels of
around 48-52 per cent.
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