Sri Lanka’­s middle-income status preserved by housemaids and unskilled labour


by Sanath Nanayakkare

Migrant worker remittances have mainly contributed to the surplus in the nation's secondary income account which is earned by unskilled and housemaid categories, the Central Bank's Annual Report 2016 reveals.

CBSL Annual Report further notes that the surplus in the secondary income account mainly backed by these worker remittances have helped in cushioning the deficit in the trade and primary income accounts of the current account to a certain extent.

According to statistics housemaids and unskilled workers account for 56 per cent of total Sri Lankan expatriate workers. Worker remittances which account for the majority of inflows to the secondary income account as the key source of private transfers have grown at a modest rate of 3.7 per cent to US dollars7,242 million, as against the decline of 0.5 per cent observed in 2015.

The Central Bank, however, states that a shift in skill levels of migrant labour can be observed over the years due to the steps taken in a strategic direction by the authorities since 2008 towards the concept of "Safe, Skilled Migration".

Still, according to 2016 foreign employment statistics only 2.7 per cent of worker departures were under the professional categories, which is a marginal improvement compared to 2.4 per cent recorded in 2015.

Meanwhile, middle level manpower categories have increased by 12.2 per cent although departures in all other categories recorded a decline in 2016 due to the global economic slowdown.

Although a notable increase in departures to South Korea was also observed in 2016, still 97 per cent of these departures were unskilled workers.

These developments reflect the scope for continued efforts towards encouraging and increasing 'Safe, Skilled Migration' of skilled categories pushing for a decline in housemaid and unskilled categories. Such efforts will lead to a healthy trend of inward remittances from skilled categories, the Central Bank states.

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