An historic number of workers are seeking work in other countries, many of them professionals. Should a nation depend on the export of its human capital?
Mohamed Ishad, left, and his relative Mohamed Fahim wait outside an immigration office in Sri Lanka to get their passports renewed in July 2022 to find work abroad to feed his wife and three children. (AP Photo/Krutika Pathi)
Queues still snake outside Sri Lanka’s main office issuing passports as they did during the height of the country’s economic crisis last year but they are not nearly as long anymore. Still, large numbers of people continue to leave the island nation in search of better economic opportunities. And many of these now come from the professional ranks.
Over at the Sri Lankan mission in Dubai in the United Arab Emirates dozens of Sri Lankans who land there on visit visas without jobs can be found pleading for cash from other Sri Lankan expatriates. The United Arab Emirates is one of the few countries where Sri Lankans get a visa on arrival.
These two examples illustrate the crisis that Sri Lanka is facing — thousands of mostly young people are leaving Sri Lanka’s shores seeking better opportunities to support their families, leaving behind a country that is battling an economic crisis, rising inflation and shortages in fuel, cooking gas and foreign exchange.
The World Bank says more than 500,000 Sri Lankans lost their jobs last year due to the crisis while the numbers living below the poverty line have increased. New personal taxes have shot up and affect middle class incomes.
As a result, Sri Lanka issued an all-time high of almost 900,000 passports last year, compared to the previous high of just over 650,000 in 2016, according to government data.
“We are losing a lot of talent and this will severely impact the economy, particularly the productive sectors,” noted Dhananath Fernando, founder and CEO of the Advocata Institute, an economic development think tank in the capital city of Colombo.
An economy that brought new taxes and no fuel
At the peak of the economic crisis in mid-2022, long queues were a prominent feature outside the passport office with mostly young people seeking to go abroad in search of greener pastures.
Sri Lanka at that time faced a major crisis due to dwindling foreign reserves which led to fuel shortages for vehicles and cooking, resulting in queues at fuel stations and rationing. While the queues have ended, fuel rationing still exists.
Last year’s crisis was exacerbated by a new tax system on income above 100,000 rupees — about $280 — per month, as the government struggles to increase revenue and meet rising costs. According to a UN classification, an average family in Sri Lanka requires a minimum 100,000 rupees for their costs and thus anything above this is taxed. Previously, only incomes above 250,000 rupees per month were taxed.
According to figures released by the state-owned Foreign Employment Bureau, more than 310,000 people left the country with secured jobs overseas in 2022, the highest in history.
However these figures relate only to those — mostly unskilled and semi-skilled workers — who seek compulsory registration with this government agency promoting outbound migration. They don’t reflect the large number of unregistered professionals who go abroad.
Migrants donning stethoscopes and business suits
More than 2 million, almost 10% of Sri Lanka’s population of 22 million, are abroad sending back money to sustain their families back home. The country joins a growing number of countries in Asia, and in particular South Asia which includes Bangladesh and Nepal, where government policy encourages migration for employment and the economy depends on the money migrant workers send home.
In Asia, the Philippines is the number one source of migrant workers to the Middle East, sending back billions of dollars in remittances.
According to Dr. Bilesha Weeraratne, research fellow and migration specialist at the Institute of Policy Studies of Sri Lanka, it is the prime working age population (between 30 and 40 years) that’s going abroad.
“Some are going on visit visas without a job while some have jobs,” Weeraratne said. “Going abroad has been a key component of the Sri Lankan labour force. However there was a drop during the COVID-19 pandemic and there was a backlog. Some of the huge exodus that we are seeing can be attributed to this backlog because those who wanted to go in the 2020-21 period didn’t have many opportunities.”
The economic situation in the country and the economic difficulties and inflation have prompted many people to leave and earn more overseas, she said. Most of the people leaving are professionals, particularly IT specialists, doctors, accountants, bankers and tourism industry personnel.
Fernando from the Advocata Institute said that to keep skilled and professional workers, many of the big companies are increasing pay to help them pay the increased taxes. Starting salaries in the private sector are well over 100,000 rupees per month.
“This is being done since if people start leaving that would be a much bigger problem for companies,” Fernando said. Last year IT companies began paying salaries to their staff pegged to the U.S. dollar, he added. Inflation is also high, at one time running at 90% in 2022 and now at 50%.
A third wave of migration
For different reasons, Sri Lanka has witnessed waves of outbound migration since it gained independence from colonial British rule 75 years ago.
In the late 1950s, a large number of the Burghers, a small minority in Sri Lanka’s current population of 22 million, migrated to Australia after the government in 1956 introduced the ‘Sinhala language Act’, whereby all government business was to be conducted only in Sinhalese, the language of the Sinhalese population, which accounts for 74% of the overall population.
The mostly English-speaking Burghers, now less than 30,000, have descended from an ethnic mix of Portuguese, Dutch and British settlers during the country’s colonial history.
The next wave of outbound migrants occurred during the country’s ethnic riots in 1983 with the Sinhalese targeting minority Tamils who number 15% of the population. Many Tamils migrated and now reside in Europe and the United States. The current outflow of professionals mostly to the Middle East, Europe and the U.S. is the third wave of migration.
Jehan Perera, executive director at the National Peace Council and a noted political commentator, said there is a positive side to the outward migration.
“They are not leaving the country with an angry mind (like the Burghers and the Tamils),” Perera said. “They are educated and another positive is that the amount of foreign remittances will increase and reduce the burden of a shortage of foreign cash.”
An indication of how prevalent the current exodus of professionals is can be seen in one message sent out by tweet by HSBC Bank in Colombo: “Considering moving overseas for work, studies or with family? Get a head start with a pre-set up bank account overseas with HSBC’s International Services which makes settling down so much easier, subject to prevailing foreign exchange regulations….”
Three questions to consider:
- Why are so many people leaving Sri Lanka to find jobs elsewhere?
- What is new about the types of people looking for work overseas than in previous migration waves?
- Does the export of human labor out of a country benefit the country these people leave behind?
Feizal Samath is a Sri Lankan who covered the war between Tamil Tiger guerrillas and government troops, and the leftist insurgency attempting to overthrow the government, for Reuters. A journalist for nearly four decades, he more recently has covered economic development in Sri Lanka for a newspaper in Colombo. A social activist and guitarist, Samath founded a concert series that has raised millions of rupees for children’s charities.