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Importing labour should only be a short-term option

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Prime Minister Ranil Wickremesinghe addressing the Sri Lanka Human Capital Summit 2016



Prime Minister Ranil Wickremesinghe speaking at the Sri Lanka Human Capital said that while the country had made great strides on many fronts, especially in education, a lot remains to be done. He said over one million Sri Lankans live oversees and we need to find a way of getting some of the best and brightest back to strengthen our economy. 

Today many of our key sectors in the economy are critically starved of blue collar workers. This is a result of the poor orientation that is taking place at school level. As a result young people are getting pushed into industries that are far less productive. 

As a country we have not done much for our young people. For example Sri Lankan universities, due to limited intake capacity, by default only open their doors to the top 5% who sit for the Advanced Level exams. 

The majority joins the work force with limited training or no training. Only around 10% pursue their higher education in foreign universities or their satellite branches in Sri Lanka or enrol into a professional qualification or a diploma course in accounting, finance, management, HR and marketing.


Education to employment untitled-1

Therefore, as a country, we need a strategy to successfully move our young people from education to employment and we need to scale up our interventions for maximum impact because there are many different views among stakeholders on how our young people should be made ready to succeed at entry level positions. As a result of this mismatch, the education to employment highway has become very messy. 

The proposed education reforms must find a way to motivate our youth to move to productive industries and from becoming mere certificate collectors and refocus them to acquire skills and competencies that are needed to deliver on the job. At the same time it is important for professionals to focus on their continuous professional development because the lifespan of skills is very short.

On the other hand, the private sector also does very little to support the growth and development of young employees to help them to be as productive and successful as possible in their current and future roles. On the merits of importing talent to fill our manpower shortage rather than producing them domestically, especially for the tourism and construction sector, the resulting structural dependence on foreign talent, and its associated disincentive to capital investment, can delay the desired transition to a knowledge economy by stifling productivity growth, innovation and entrepreneurship in the country. 

However, importing talent could help to fill critical short-term skills gaps but with a clear strategy for growing our own talent. The right talent strategy can help the tourism, hospitality, and leisure and construction companies to own the upturn.


Export economies

In successful export economies, the training provided by VTIs jointly with the private sector to upgrade the skills of their work force has been crucial, since high-level skills are essential for manufacturing related activities. 

The key takeaway from the recent Human Capital Summit is that while vocational training is widely recognised as being very important, such training is rarely cost-efficient when provided by the State systems. Most firms therefore prefer to do their own training, partly because many skills are company specific. 

There is ample research to show that the return on the training investment is higher in industries that engage well-educated workers and also in environments where there is rapid technological change. 

Singapore’s use of training to promote the information technology sector through a concerted program that involved educational institutions, providing training subsidies to schools and office workers, and digitising of the civil service, helped the country to achieve leadership in technology related services. 

This success illustrates the importance of a government’s ability to foresee a major opportunity and then promote public-private partnership to invest in human capital formation. However, to make it a success, businesses must also stand ready to take advantages of the support the Government is willing to provide to promote human capital formation. In addition, the State must ensure that they maintain the per student share, in real terms, of government funding education. 

Today the country’s university education is only limited to the brightest students in the country. The universities need to work very closely with industry to improve syllabi and the facilities to ensure that the country’s brightest students are instilled with the skills and knowledge the country needs so that they can make a meaningful contribution to the country. 

In addition, we also need to make education more affordable because cost still remains the number one barrier among the youth for not continuing their education. Therefore we need to devise numerous ways to provide additional funds for economically vulnerable populations through scholarships and subsidies. 

The Government clearly knows what needs to be done, therefore they need to get on with it and deliver before it is too late for them and the country.

(The writer is a HR Thought Leader.)

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