Youth and Employment in Sri Lanka – Comments on the UNDP #NHDR2014 Report

photo 2On the request of some of those who attended this morning’s launch of the UNDP’s National Human Development Report 2014 on the theme of ‘Youth and Development’ (coinciding with Int’l Youth Day today, 12th August), I am posting here my comments that I shared during the short panel discussion that followed the formal launch. I was asked to focus on the ‘Employment’ chapter of the report, while Senel Wanniarachchi focussed on the education chapter, Salma Yusuf on the reconciliation and social integration chapter, Mohammed Hisham on the political and civic participation chapter, and Kenosha Kumaresan focussed on the health chapter. My key thoughts were that the rapdily-shifting aspirations and attitudes of youg people towards types of jobs must be factored in when talking about youth employment policies; that policies to support small biz and entrepreneurship will certainly help young people; that the emerging focus on Sri Lanka as a ‘knowledge-driven economy’ will put pressure on rural youth and we must ensure they are not left out from the new growth opportunities; that youth-focussed interventions risk being incoherent and fragmented if we don’t focus on coordinated implementation; and finally that Sri Lanka must make sure that the array of youth-focussed national policies and frameworks truly work for youth and don’t suffer from “policy creep”.

This report is very timely. It brings focus on ‘youth’ as a driver of growth and development at a time when Sri Lanka is going through the middle-income transition. We are being squeezed from many sides – demographic change and a shrinking youth population, we are no longer a cheap factor inputs location, and the aspirations of young people shifting fast – much faster than the economy can keep up with. So, ensuring young people are active economic players in growth is key in this middle-income transition phase. That’s why this chapter on employment is so key in the overall ‘youth and development’ focus. The report also very rightly recognizes that growth and investment really is at the heart of youth job creation. Without growth and job creation overall, there will not be job creation for youth. Sri Lanka is aspiring to achieve 8%-plus growth, coupled with very ambitious economic targets. The challenge then is – how do we ensure make growth policies pro-employment, and specifically pro-youth employment.

I will not attempt to recap a lot of the rich statistical insights and revealing numbers that the NHDR 2014 puts forward – I’m sure you can refer these in the report. But let me highlight for you 3 key facts that I think are the underlying issues when it comes to youth and employment.

 

1. Youth in Sri Lanka are more likely to be unemployed than other group

2. Young women are participating far less in the workforce than young men and they’re also more likely to be unemployed

3. But that this struggle is not unique to Sri Lanka, as countries around the world struggle to get young people into jobs and various mismatches challenge this effort. But, on a positive note, youth unemployment in Sri Lanka has fallen faster over time than the rest of South Asia. (But maybe it’s time to stop benchmarking ourselves against South Asia and look towards the rest of Asia)

 

I want to share a few key thoughts that came to me while reading the chapter on youth and employment.

 

The report summarizes the issue of youth unemployment as follows:

“Youth unemployment results from mismatched skills, excessive numbers of workers seeking certain jobs, and limited information on jobs available or qualifications required.”

But I think there is an additional element here – the shifting of youth aspirations and how that is influencing the job search and waiting process. I was very happy to see that the report had addressed this area, to some extent. It has recognised the role that ‘aspirations’ play in the youth employment challenge. But I would have liked to see more analysis on how these aspirations are influencing job choice. The report rightly observes that youth have skewed aspiration towards public sector jobs – for reasons we are all familiar with – stability, generous pensions, ‘jobs for life’, etc. But it does not tackle the shifting mindset with regard to private sector jobs too. The report cites that “aspirations are being shaped by cultural perceptions and parental hopes”. But I think there’s a third element here – attitudes towards certain types of work. Attitudes of young people are quickly shifting away from manufacturing or factory-type jobs, and towards jobs in the retail and service sector – what I call the “food-city syndrome”. That will be a key influencing factor of youth employment policies.

photo 1I also welcome the fact that the report has included sections on youth and enterprise development. The focus on SMEs as a key youth employment generator is a welcome change from older youth-related reports that look at ’employment’ from a very traditional lens. The report rightly emphasises that interventions to improve access to finance and access to markets can help youth actively engage in livelihood opportunities in their own localities. We need to get serious about SME policy. I can assure you that a sound SME policy that tackles access to finance, that makes it easier for people to start and grow their businesses, makes the rules and regulations friendlier, will benefit young people who want to get into entrepreneurship. When the report says that youth issues cannot be isolated from larger concerns, this applies to entrepreneurship and SME growth too. Policies to boost entrepreneurship and policies to boost the SME sector will necessarily benefit youth as well. Yet, I felt that the role of entrepreneurship could have been emphasised more and received greater focus on the report, in the context of youth employment – youth as job creators.

The other aspect I want to flag is the changing structure of the Sri Lankan economy and how youth fit in. We keep talking about Sri Lanka becoming a knowledge-led economy, a services-driven economy, etc. But we are forgetting that nearly 1/4th of our entire youth population is in rural areas, and another 1/5th is in estate areas. Are we doing enough to gear them to jobs in the knowledge or services economy? Or will they be left out of the new growth opportunities that are emerging?

Let me come to my final point – the implementation gap.
While the youth agenda receives a lot of focus, and many institutions develop programmes for it, I worry that interventions to tackle youth unemployment will become fragmented, incoherent and uncoordinated. Everyone wants to get on board – donors, NGOs, government agencies, private sector – in tackling youth employment issues. But we must make sure that these programmes work well together and are based on sound analysis of needs. I think its time to undertake more smaller initiatives, without attempting mega national programmes, and see which ae working best and then scale those up. Additionally, interventions that don’t take into account realities of aspirations and attitudes to jobs, and how those are changing, will also risk failing.

There is a case for more private-public partnership in developing industry-oriented skills. We can learn from the Penang Export Hub in Malaysia where the world’s top electronics firms faced a skills shortage and they teamed up with the government agencies to create rapid and focussed skill training initiative – it helped ensure that the skills were what the industry needed, and ensured that there are job opportunities at the end of the line.

Many new schemes are indeed beginning to take into account job market needs, but I still feel that there’s not enough. There needs to be a continuous feedback loop of information – research on industry/labour market needs, surveying enterprises to see growing sectors and labour shortages, what types of training and skill needs are emerging as needed, etc. The report highlights some of these aspects, and must be commended for doing so.

It is now nearly twenty-five years since the Presidential Commission on Youth released its report. Since then we have so many policy frameworks for different aspects of youth development, and the report recaps these and makes a strong call for bridging the implementation gap. Sri Lanka now has a National Youth Policy (2014), a National Action Plan on Youth Employment (2008), a National Policy Framework on Social Integration (2012), a National Human Resources and Employment Policy (2013), a National Enterprise Policy (2009), and a forthcoming National Policy on SMEs. We need to make sure that these policy frameworks “work for youth”. The research and analysis is there, in reports like this, the policy commitment is there as mentioned this morning. Twenty five years from now, the young people in this panel and in this room should not need to look back at this era and say that the policies and initiatives didn’t work.

Thank you.

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