By: Staff Writer
March 25, Colombo (LNW): As Sri Lanka battles it’s worst economic crisis in 70 years, the jobless rate climbed stoking massive social and political concerns. The latest official data showed the island nation’s unemployment rate rose to 5 per cent by the end of September last year, during which the economy contracted by 12 per cent.
Since the economy hit rock bottom last year, the majority of the people in the country are struggling to survive while those who committed the worst economic crimes are enjoying a life of comfort with little repentance for their mistakes that has placed the burden on the general public.
It has always been the public who are asked to tighten the belt in the time of an economic downturn but those in the ruling class and their cronies never seem to practice what they preach.
Sri Lanka’s official unemployment rate slipped to 4.3 percent in the final quarter of last year from 4.7 percent in the quarter before as the economy expanded in the final three months of the year.
This is roughly thrice the pace of the third quarter growth, data released by the Census and Statistics Department showed.
Sri Lanka’s Gross Domestic Product (GDP), the value of total products by an economy, expanded by 4.5 percent in the fourth quarter of last year from 1.6 percent in the third quarter as the country was recovering from the shortage of foreign currency which reached a breaking point in early 2022.
As now the country generates US$ 825 million from both remittances and tourism every month, the worst of the crisis in the economy appears to be behind and the people who remained in the sidelines for a very long time..
Many companies until recently either had laid off staff or froze their hiring due to the effects of the recent crises stated above and are now beginning to rehire as the economy shows signs of recovery.
But, in the last two years Sri Lanka saw mass migration, particularly in the categories of professionals which wasn’t that intense before the economic crisis in 2022.
As companies begin to rehire, they might find shortage of talent in the economy. An official jobless rate of 4.3 percent reflects near full employment and thus point to tight labour market conditions too.
Meanwhile, the Labour Force Participation Rate (LFPR) or the section of people both employed and unemployed but looking for work as a share of the working age population further shrank to 47.1 percent by the end of fourth quarter last year from 48.8 percent in the third quarter and 49.8 percent in 2022.
In the Organisation for Economic Co-operation and Development , the Labour Force Participation Rate (LFPR) stands above 60 percent.
