CHANGING NATURE OF THE LABOUR FORCE IN SRI LANKA: PREDICTING OCCUPATIONAL STRUCTURES OF MAJOR INDUSTRY GROUPS

Abstract

The major objective of this paper is to explore the changing nature of labour force by predicting occupational structural changes.Data for the study was obtained from the Quarterly Labour Force Survey conducted by the Department of Statistics in Sri Lanka. In this study, our main focus is on two aspects: first, percentage changes in employed population by major industry group and second, changes in current employed population by occupational group. In order to predict the employed population by major industry group, a trend analysis is performed. This study found that there has been a shift of the occupations from agricultural sector more towards the service sector also industry sector shows a moderate growth during the recent past. Therefore, the predictions made in this study reveal that employment in the service sector will continue to grow during the next 14 year period while trend for the industry sector would grow with a slower pace. Employed population in the agriculture sector will continue to decline. When predicting occupational structures, it was also observed that the occupations such as professionals, technicians and associate professionals, services and sales workers, plant or machine operators and assemblers would grow in to the future with an indication that more and more jobs will be created mainly in service and industry sectors. This analysis indicates that there will be a little shift from unskilled type workers to skilled workers at all levels. Although a shift from agriculture to industries is a feature that is usually observed during the first phase of the economic growth, Sri Lanka will show a different status by skipping the industry sector growth and then moving to services from agriculture directly. This can be seen as an economic achievement because Sri Lanka has started leap-frogging from an agrarian economy to a service economy. The study suggests that the major reason is feasibly Sri Lanka’s human capital, which is well-educated, and relatively low-priced labour which lead to lift the service sector and create more employment opportunities. Similarly, absence of capital goods industry to promote industrialization as well as the absence of market for industrialized goods could be other probable reasons. Therefore, the study hypothesizes that a greater demand for employment will be generated in the service sector while proportion of employed population in agricultural sector will gradually decline.