In 2019, Sri Lanka's age dependency ratio and the young working-age population were 36.74%, per the World Bank Collection. Note that this historical data, actual values, projections, and forecasts were fetched from the World Bank in June (2021).
Sri Lanka is a peaceful island nation in the Indian Ocean with a population of nearly 21.8 million. The country has a rich cultural heritage with an increasingly ultra-cultured workforce, which has positioned the nation well for driving strong economic growth. It means that most Sri Lankan natives can earn more now and invest in their communities and families. Recently, Sri Lanka became a higher middle-income nation with a GDP per capita nearing USD 4102 (2018). The economy in the country is transitioning from predominantly rural areas to urban areas with a major focus on services and manufacturing.
Sri Lanka holds an economic policy vision of 2025, wherein it aims to firmly get embedded in numerous principles involving the social market economy, which delivers economic dividends to all. For this, the government, in the initial place, ensures to have a skill pool, which can meet the rising need for hire in Sri Lanka and can help match the job market's needs.
Overview of Sri Lanka
Population: 21.8 million
GDP: USD 84,008.8 million (2019)
Sri Lanka's free-market economy was worth nearly USD 84 billion by GDP (2019), and purchasing power parity (PPP) came to USD 296.959 billion. The country witnessed an annual growth of nearly 6.4% from 2003 to 2012, which was above their regional peers, driven by the rise of non-tradable sectors that the World Bank warned to be both inequitable and unsustainable, and has slowed after that. In the year 2019, with 13,620 PPP Dollars income per capita, the nation was reclassified as a lower-middle-class nation as per World Bank from the previous status of the upper-middle-income class.
Sri Lanka, with the vision of a happy 2025, has planned to deliver impressive outcomes. The government has created more than 4,60,000 jobs and has even helped more than two hundred thousand families secure their homes. Thoroughly substantial progress is being made regarding hire in Sri Lanka to bring great opportunities to the rural communities by formulating required infrastructure like bridges and roads, connecting urban and rural regions, and linking Sri Lanka's economic hubs.
The services in Sri Lanka accounted for about 58.2% of Sri Lanka's economy in the year 2019, which increased from 54.6% recorded in the year 2010. The industries in Sri Lanka recorded an enhancement to 27.4% from 26.4%, which was a decade ago, and agriculture rose to 7.4%. While there is huge competitive export in the agricultural sector, technological advances have witnessed a slowdown. Sri Lanka has the largest industrial and solid tire manufacturing center and even an apparel sector going up the value chain. However, increasing trade protection over the past few decades has resulted in concern over resurgence to the inward-looking policies.
Brief Glimpse of the Industries
Mineral extraction industries of Sri Lanka include gemstones, mining, graphite, quarrying of kaolin, quartz, apatite, silt, clay, excavation of beach sands consisting of monazite and ilmenite. Among these, the mining of gems is most crucial as it produces high-end gemstones like ruby, sapphire, topaz, and other semi-precious stones that reach foreign markets. Monazite, ilmenite, and graphite exported in a semi-processed manner contribute to a meager extent to the nation's foreign earnings.
Sri Lanka's Central Bank manages all the banking and currency-linked issues. Until the late 70s, commercial banking was extremely close to the exclusive monopoly of the two state-run banks, namely, People's Bank and Bank of Ceylon. Post the liberalization period. It enabled numerous privately run commercial banks and the whole expansion concerning the banking field. Similar trends have been replicated in other commerce-linked spheres like wholesale trade and insurance. Enhanced participation of private sectors in commerce and industry resulted in vibrant stock market trading in Colombo.
Cost of Living in Sri Lanka
Sri Lanka is a beautiful island that has an exotic attraction in every corner. The place is revered for its history, great charms, and wealth, which expatriates find difficult to resist. For those within their budget, the nation can be fairly inexpensive. Thus, if you stick with using local transport and stay in cheap rentals, you can easily afford to stay in Sri Lanka.
The living cost in Sri Lanka as of April 2021 is very low as compared to other places. As per data, living cost in Sri Lanka touches 445 USD/month for one person. This amount is about 1.66 times less costly compared to the world average. Also, Sri Lanka was ranked 186th nation out of 196 countries for having a lower cost of living and 100th in the ranking to be the best nation to reside in. The average salary after taxation in Sri Lanka is nearly USD 267. This is adequate to cover the living costs for 0.6 months.
Break Down of Average Monthly Cost of Living in Sri Lanka
Cost Incurred on Renting in Sri Lanka
The monthly expense of a family of four is estimated to be about USD 1072 when the family lives in a rented apartment. A single individual is estimated to incur a monthly rental cost of about USD 445. Rental cost in Sri Lanka, on average, is about 80% lower than in the US.
Top Skills in Sri Lanka
Demand for job-linked skills is rising in Sri Lanka, which intends to become a competitive middle-income nation. As their economy has evolved, the gross domestic product composition has moved from the agriculture sector to higher-value sectors such as industry & service, which require a completely skilled workforce.
Sustaining the goal of having an annual GDP growth of nearly 8% is a major aim of the government's plan. Their ambition is to make Sri Lanka the hub of five strategic regions: aviation, maritime, energy, commercial, and knowledge. It will further enhance the demand for skilled man force.
While Sri Lanka has attained universal access to knowledge/education/training, employers are cross-questioning the relevance and quality of the training and education system. There is an acute shortage of skills, particularly for those in demand and supply, mostly not relevant with marks as per reports by World Bank.
Employment Laws in Sri Lanka
- Employment laws of Sri Lanka do not differentiate between local or foreign employees. They are equally applied to both, regardless of whether it is regular employment on fixed terms, seasonal or casual.
- The minimum wage for all the staff/employees regardless of the industrial sector is USD 50.26, and the minimum per day wage is USD 2.01.
- Total working hours excluding rest and meals should not be over 9 hours per day or 45 hours per week.
- The wages get paid on a weekly, daily, or monthly basis. But a wage period cannot surpass a month.
- Overtime compensation is compulsory. Overtime should be paid at 1.5 times the hourly average rate of wage. In a week, the overtime hours cannot exceed 12 hours.
- Any employee working for over 28 hours, excluding the overtime and rest breaks in one week, should be permitted 1.5 days of paid leave for that specific week or week instantly after it. Note that most of the establishments provide a full day's holiday on Saturday. Any staff or employee required to go to work on a weekly holiday might be entitled to payment at an overtime rate.
- There is zero obligation imposed by the law on staff to pay bonuses. Generally, unless mentioned in the employment contract, the bonus payments are wholly at the employer's discretion and entirely dependent upon the employer's financial performance.
- EPF (Employees' Provident Fund) and ETF (Employees' Trust Fund) are contributed by employers and employees. The minimum contribution must be 8% by the employees, 12% by the employers as EPF, and 3% by the employers in the ETF.
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