ISSN: 1391 - 0531
Sunday, March 25, 2007
Vol. 41 - No 43
Financial Times  

Young people ‘gederata nakiwenawa’ while governments think up solutions

By Dilshani Samaraweera

Young people in Sri Lanka find it harder to find employment and employment is still dependent on ‘connections’ rather than merit. Meanwhile Sri Lankan society is transforming into an aging population and the country is running out of time to harness the resource of ‘youth’.

Clock is ticking
Sri Lanka’s youth boom started in the 1960s and is now reaching its end. In fact economists estimate that Sri Lanka has less than 10 years of the youth opportunity left before time catches up.

“The world is facing a youth bulge, where the 12-24 age group is larger than ever. Some see this as a fiscal and economic risk because governments have to allocate a lot of resources to take care of them. But this is also an opportunity because of the increase of workforce creating an opportunity to invest in other things. However, this window of opportunity is open only for about 40 years depending on fertility rates, and then ageing will close this window,” said the country director of the World Bank Sri Lanka, Naoko Ishii, speaking at this week’s launch of the Bank’s latest World Development Report titled Development and the Next Generation.

“In countries like Japan and Italy this window of opportunity closed about a decade ago. In developing countries like India and Bangladesh the window will remain open for another 3 decades. In Sri Lanka the window of opportunity will close within a decade. So you must seize this opportunity quickly,” said Ishii.

But at a time when the labour force should absorb as much young people as possible, what is happening in Sri Lanka is the opposite.
“One most shocking fact is that youth unemployment is much higher than unemployment among others in Sri Lanka. Youth unemployment in Sri Lanka is about 30% compared to unemployment of about 10% in other age groups.

Youth unemployment in Pakistan and India is also high, but it is less than 10%. So the situation of youth unemployment in Sri Lanka is very, very serious,” said Ishii. The Youth Employment Network (YEN) in the Ministry of Youth Affairs says that 71% of the unemployed in Sri Lanka are young men and women between the ages of 15-25 years.

Educated but unemployed
The high youth unemployment means that Sri Lanka is not reaping maximum returns from the public money spent on education.
Years of public funded education is going waste with a large proportion of working age young people staying at home dependent on others, instead of contributing to the national economy.

Unemployment is highest among O/L and A/L qualified young people. “There is a high degree of educated youth unemployment.
Nearly 50% of the unemployed have attained O/L or higher education. For youth with an A/L qualification the unemployment rate is 25%,” said the CEO of YEN, Deepthi Lamahewa. Unemployment among local university graduates is lower.

But a World Bank study at the University of Colombo done in 2006, shows that degree holders waste years at home before finding jobs.
“A large percentage of university graduates remain unemployed for long periods after completing studies. Less than 20% find employment in the first 4 years after graduation,” said World Bank Social Protection Economist, Nimnath Withanachchi.

Connections, not merit
Another depressing fact is that despite free education and an open economy, jobs are still dependent on ‘connections’ rather than qualifications. Political and family connections are still extremely important in getting a job in Sri Lanka.

“64% of young workers reported that they were recruited through recommendations of their friends and relatives. These contacts were often based on social and family networks including old school networks. The need for connections was more deeply felt for employment in the private sector, where the correct social connections and a shared cultural ideology were seen as basic requirements,” said World Bank Senior Social Protection Economist, Milan Vodopovic, citing a previous research (Mayer and Salih, 2005).

The World Bank study at the Colombo University too, notes that graduates from lower social economic strata find it more difficult to get jobs. “So there is still use of contacts to get jobs when we would rather see more merit based hiring,” said Vodopovic.

Government jobs
The World Bank says ad hoc government recruitment, like graduate recruitment campaigns, although providing jobs, indirectly adds to youth unemployment.

“Government ad-hoc recruitment policies also contribute their share to queuing and thus to unemployment,” said Vodopovic.
Queuing means waiting for a ‘good’ job to turn up. Government jobs are generally considered more stable with generous fringe benefits. So when governments have a track record of absorbing large numbers of unemployed, parents and young people wait for these government jobs instead of looking for jobs elsewhere. This waiting for a government job adds to national unemployment and dependency.

The World Bank points to the restrictions on terminating workers in the private sector, as another indirect contributor to unemployment. The bank says that since companies cannot hire and fire at will, they also generate fewer jobs.
Poor educational and vocational training facilities, particularly in rural and plantation areas, are another reason for high youth unemployment. Young people from such underserved areas do not get the correct education to meet labour market demands and are forced to remain unemployed or take any job that comes their way.

Youth plan
The Youth Employment Network (YEN) says it has got Cabinet approval for a national action plan to address youth unemployment.
“We have got Cabinet approval for the national action plan and a Cabinet sub committee has been set up. The government is now in the process of making allocations for youth, in the government’s 10 year development programme,” said YEN’s Lamahewa.When these plans will be implemented however, is unclear.

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Copyright 2007 Wijeya Newspapers Ltd.Colombo. Sri Lanka.