The Department of Labour has launched the second phase of its survey on the impact of COVID-19 and beyond on businesses and their employment level as a follow-up to the inaugural exercise done mid-2020.
“The first e-survey conducted in April 2020 provided valuable insights that were helpful to appropriate policy recommendations.
The ongoing survey hopes to capture the status of employment, both current and future which will provide essential clues to identify gaps and structural adjustments that need to be made to protect both the employee and the employer,” Commissioner General of Labour B.K. Prabath Chandrakeerthi told the Daily FT.
According to him, COVID-19 global pandemic has impacted all countries and their economies in a variety of aspects causing multiple implications. The general ‘norm’ of the global population is being challenged, where the need has arisen to find a ‘new normalcy’.
Chandrakeerthi said the initial e-survey carried out in April 2020 indicated signs of contractions, with an estimated 64% of the labour force remaining in homes without work at the time of survey. Further, foreseeing future loss of businesses, employers had commenced to reduce their staff strengths accordingly.
He noted that with the COVID-19 situation aggravating since October 2020 following the second wave, the Department was keen to further assess the implications on employment, employees and employers and recommend suitable strategies to avoid loss of jobs and protect these stakeholders.
“In the current context in which Sri Lanka is attempting to continue economic activities at the maximum possible level whilst containing the spread of COVID-19 a reassessment of the labour market situation has to take place to understand the dynamics in the labour force,” the Labour Commissioner said. “The second phase of the e survey will help measure the magnitude of the COVID-19 second wave impact to the Labour market,” he added.
He said that the continuous nature of the study is expected to create more awareness on the actual employment levels in the country and the possible impacts. It is expected that the responses will lead to identification of evolving patterns and changes in the nature of employment. Such identification will have the ability to provide insights into current and future labour law reforms too.
The survey questionnaire can be accessed through www.labourdept.gov.lk and be submitted online. The Department expects to receive responses until 15 February. Link to the English version of the survey can be found at docs.google.com/forms/d/e/1FAIpQLSdezuuWrJGmJPNtKf4--KMOi3I6iWPUkiAuWPgUP9uN7pMPlA/viewform.
The Labour Department is seeking active participation of all private sector organisations, SMEs, entrepreneurs and semi-Government establishments for the ongoing survey.
The Commissioner has assured information shared will be used only for policy making purposes and will be treated strictly confidential.
“We thank those who responded to the earlier survey with valuable information and we welcome them to participate in the latest exercise as well,” the Labour Commissioner added.
The expected reassessment will assist in making sector specific strategies to stimulate protect and promote employment in the country. Further, the survey is also expected to assess the impact of the decisions taken by the Government to address labour related issues, including payment of salaries.
Such assessment will assist the policymakers to take appropriate and sustainable decisions regarding employment within the evolving labour market conditions.
“Therefore, the second phase of this survey would be much beneficial to understand the real scenario of the operational capacity of the industries and the employment situation,” Chandrakeerthi explained.
The first survey report accessible via the website of the Department (labourdept.gov.lk/images/PDF_upload/notices/survey%20report%202020.pdf) highlighted the number of closed establishments, number of establishments in operation and under capacity and number of establishments in full operation.
In the first survey done in April last year, 2,764 establishments in the formal private sector responded with 58.59% of establishments belonging to the Colombo District. All 21 types of industries included in the International Standard Industrial Classification of All Economic Activities (ISIC) have been captured, with the manufacturing sector taking the lead with a cohort of 28.65% from the total responded establishments. 53% of the establishments had their businesses ‘closed’ during the survey period (months of April and May), with only 3% of the establishments capable of functioning ‘fully’.
The total employment in these establishments in the month of February was 596,022, with a staggering 64.26% of the employees not in work during the survey period. Alarmingly, 1,084 establishments had indicated that they would be unable to pay salaries to their employees.
Unfortunately, the results indicate the commencement of lay-off/termination strategies of establishments hinting at the rising unemployment figures of the country. Only 2% of the responded establishments have been successful in securing the working capital loans offered by financial institutions, with 48.11% of establishments awaiting the outcome of the applications.
Survey results indicate the strong relationships between the size of the establishments and the ability to operate the business during the survey period, ‘status’ of operation, ability to pay salary in future, and the total employment, with significant variations with respect to industries. These findings indicate the need for arriving at industry specific interventions to revive businesses with the aim of protecting both employment and business sustainability.
According to the Labour Department, the economically active population in Sri Lanka was at 8.6 million, with 64.5 % males and 35.5 % females. The private sector employs almost 3.5 million people whilst own account workers amount to 2.7 million. Non-agricultural sector employs 81.3% of the private sector employees and 57.3 % of own account workers.
(FT)