Demographic shift and the development opportunities
by Parakum Jayasinghe
December 12, 2016

Sri Lanka is experiencing a demographic dividend under which the child population is decreasing, labour force increasing and also the elderly population increasing but in a manageable size, said Dr. A.J. Satharasinghe, Director General of Census and Statistics Department.

Addressing a Generation to Generation Dialogue hosted by the United Nations Population Fund (UNFPA) held on 9th December 2016 in Colombo, he said that this was due to the improvement in the reproductive health conditions of the country, rapid declining of fertility and subsequent population structure.

“The elderly population over 60 years of age doubled in 2012 compared to the 1981 population census. Likewise, the labour force is also increasing. It is very important to discuss about this elderly population. We conducted a national health survey in 2014 and we found that one out of two of the elderly persons suffer from one or more chronic diseases.”

The census and statistics chief of the country emphasized that this is a matter of concern with regard to gaining the advantage of demographic dividend. He pointed out that the Sri Lankans are beginning to suffer from chronic illnesses since the age of 40 years.

“Countries like Singapore, Hong Kong and South Korea successfully gained the advantage of demographic dividend and became economic giants in Asia. For example, in the Republic of Korea, the fertility rate came down in 1960s. Elementary school enrollment declined. As a result of that, they could invest more on higher levels of education,” said the Director General citing it was a classic example for good planning.

The female labour force participation which stagnates around 36% is a serious concern for Sri Lanka. In Republic of Korea the female labour force participation is 72%.

“They integrated the females into the labour force very well to achieve the advantage of demographic dividend,” said Dr. A.J. Satharasinghe.

“Demographic dividend is identified in three means, i.e. changes in the labour force, increase in the savings and improvement of the quality and the quantity of the human capital. The changes in the labour force is directly related to the growth of the economy.

“Generally, between 20 and 60 years of the age, in Sri Lanka, the economically active percentage is higher than the economically inactive population. But this does not reflect among the females in the population. The economically active female population is higher than the economically inactive females only in the age group between 40 to 49 years of age.

The productivity of the labour is also a very important matter. Sri Lanka is currently seeing a rapid expansion of the service sector of the economy.

“Out of the three labour sectors, i.e. agriculture, industry and services, the agricultural sector employs 28.7% of the population. But the contribution of the agricultural sector to the GDP is only 8.1%. That means it is very important to focus to increasing the productivity of the agricultural sector.

“Limited job opportunities, lack of training, limited channels to seek employment, having other responsibilities, factors limiting their capacity, discouraging and not being immediately available prevent the actualization of the potential labour force. The number of this potential labour force is as much as 216,000 as we have identified. Given the opportunity, they might join the labour force.”

The youth between the age of 15 to 24 who are not employed, not in education and not in training are a big population of 734,000. “If you bring this lot into the labour force you will see the impact in the economic growth,” said Dr. A.J. Satharasinghe.

He pointed out that there are diverse views on the time period the demographic dividend lasts. However, he stated that it was a limited opportunity we were experiencing and if we missed it the economy would be under pressure when the current working age population moves into the elderly age category. “We will lose the demographic dividend once the dependency ratio is increased,” he said.

“We need to continue the protection of reproductive health of women; we have to fast track educational reforms to build a skilled and innovative labour force; we must have strong public sector programmes for families that have low income; we must absorb economically inactive, unemployed and female populations into the labour force; we must encourage savings and we must increase the economic productivity. These are some of the key issues we must address to make the full use of the demographic dividend,” the Director General of the Census and Statistics Department Dr. A.J. Satharasinghe concluded.

Three Thematic Reports based on the statistics of the 2012 National Population and Housing Census were launched at this event.

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