Sri Lanka’s Rapidly Ageing Population & Socio-Economic Challenges
By Zahran Sikkanther Lebbe –April 22, 2016
Zahran Lebbe
Sri Lanka’s rapidly ageing population poses serious challenges on several fronts. Selected socio-economic challenges of this demographic transition are highlighted in this article, calling attention of the policy makers to implement fruitful interventions to preserve the rights of the elderly and to ensure their financial stability, social security and easy access to healthcare.
Statistics shows that the population above the age of 60 years was 2.5 million in 2012 which is 12.5% of the total population whereas projection shows that Sri Lanka would have elderly population of about 3.6 million by 2021, which is 16.7% of the total population and by 2041, one-quarter of the population would be elderly.
Strain on Public Financing
As a greater proportion of population reaches retirement age, more people will be drawing from public funded pension schemes which could absorb greater fraction of future national expenditure.
Additionally, the government has to allocate more funds to fulfill their health care and welfare needs, whilst the national expenditure priorities would be negatively impacted with the availability of the limited fund for the public investment activities and for economic prosperity.
Shrinking National labor force
Ageing population will not only create a shortage of young talent in the national labor force, but also create large-scale exodus of experienced human capital from the national labor force reaching their traditional retirement age.
National labor force will be further burdened with the outward migration of young local talents and once if the existing Sri Lanka’s low level of female labor force participation is continued.
Furthermore, statistics shows that the labor force participation of the Sri Lankan elderly population also remains low.
Encouragingly, elderly people live healthy and active even at the oldest ages and as a result many of them may prefer to remain in the workforce even after their retirement age. Hence, appropriate policy changes could be implemented to retain them in the workforce, further contributing to the economic progress of the country.
