Arthur C. Clarke, a long-term resident of Sri Lanka, was the first to use the term Lost Generation about Sri Lanka. He applied this term to my generation – Gen X of Lanka – severely affected by two conflicts, one in the North and the other in the South. Although the exact number is unknown, nearly 100,000 young people lost their lives to these twin calamities. Many of the deceased did not get a dignified funeral; their charred bodies were left along roadsides or left to float down rivers. Their parents and loved ones still commemorate their deaths annually at various monuments dedicated to them. Tens of thousands of others fled the country, legally and illegally, in the same way that Syrians and Afghans do today. Indeed, the wise science fiction writer was correct. If that generation was not a lost generation, then what could be?
There is more to this. The survivors in my generation took seven or eight years to complete their first degrees, which should have taken 3-4 years. The state universities were shut for long, indeterminate periods, driving many, including myself, to pursue overseas education to avoid the extended wait. Despite this, we experienced delayed entry into the workforce. Upon entering, we found that non-graduates had already advanced to senior positions, putting us at a disadvantage. This disadvantage manifested in an overrepresentation of the graduates of our generation in the public sector relative to the private, creating a significant void in the latter. Furthermore, a relatively low number of graduates in our generation pursued higher education, with many prioritizing industry entry and other obligations before exploring additional educational pursuits. Ultimately, this phenomenon created an HR capacity vacuum within the national economy, which could have contributed to the recent economic crisis, though nobody has measured that impact.
Every economic crisis in every country creates a lost generation. Zimbabwe’s lost generation refers to the young people disproportionately affected by its economic crisis in the late 90s that led to widespread poverty, unemployment, and a decline in the quality of education and healthcare. The youth unemployment rate in Zimbabwe is now over 80%. Many young people are still unable to find work and often forced to live in poverty. The Greek example would be more appropriate as it underwent almost the same experiences we do now. The Greek economic crisis, which began in late 2009, immediately upsurged the unemployment rate. Between 2008 and 2016, Greece lost over one-fourth of its GDP, resulting in precarious work regimes, rapid increases in poverty, substantial income loss, widened income inequality and disruption of social cohesion. The unemployment rate grew from 7.5% in September 2008 to 20% by 2011. The austerity measures created a vicious cycle of recession, with unemployment peaking at 26% in 2012, i.e. more than double the Eurozone average. The crisis triggered a sharp reversal in migration flows, with immigration suddenly halting and emigration increasing, creating a significant capacity vacuum with the country finding not enough employees to build the momentum to thrust the country ahead.
Sri Lanka’s next lost generation is emerging right now. The country’s dire economic situation is almost certainly leading to this outcome unless there are rapid and far-reaching reforms to change course. However, such reforms are unlikely. Therefore, it is more rational now to discuss the possible impact of this lost generation and how it will differ from similar instances in other countries.
Sri Lanka’s next lost generation will be different from previous generations in multiple ways. First, the current economic crisis is much more severe than any experienced before. Second, the population is much younger than it was in previous generations, meaning that a larger proportion of the population will be affected. Third, the global economy is much more interconnected than it was in previous generations, meaning that the impact of the crisis will be felt more widely.
he origins of the vacuum go back to three years. It started with the Covid-19 lockdowns. During the 2020-23 period, many students were unable to attend school due to lockdowns and other restrictions. As a result, a significant portion of the younger generation has lost out on essential foundational primary education. When these students returned to school, it was found that only 25% of them had gained knowledge of the alphabet and basic mathematical functions. Those were the ones who had learnt ABCs from their parents and grandparents who had the ability and time to teach them. The remaining 75% had essentially no formal education. This is a serious problem that will have long-term consequences.
The effects of this educational vacuum will not be immediately apparent. However, they will likely become evident in decades to come, as these students enter the workforce and compete for jobs. The 1971 rebellion in our country is a case in point. The disturbances of that time hurt education, and the results of the GCE (O/L) examination in 1982 were remarkably poor. The 2020-22 educational vacuum will likely have a similar impact on future generations. This time the impact will be felt not just in a year, but over several years. It will be like reduced production in an assembly line. The effect will move along the line till it makes a bad dent in society somewhere.
Further, the economic crisis in Sri Lanka is driving millions of people into poverty, threatening their rights to health, education, and an adequate standard of living too. A nationally representative survey by LIRNEasia has shown that the population living below the poverty line in Sri Lanka had increased to 7 million by 2023, from a pre-crisis figure of 3 million. The same survey has also shown that rural poverty has doubled to 32% since 2019, while urban poverty tripled to 18%. These ‘nouveau-poor’ families will be certainly putting their food requirements before the education of the children. So it could be possible that the next generation could have less or no ability to compete for professional jobs.
This is just one facet. The other facets might be more critical. The economic crisis has already had a significant impact on the labour market. The crisis has caused a contraction in the economy, leading to tens of thousands of job losses. Sri Lanka also lost well over 300,000 of its workforce in 2022 to overseas employment, which is the worst for any year on record. Multiple industrial factories have closed down their operations, creating an employment vacuum. As a result, unemployment figures have risen, and a certain section of the workforce is not receiving the experience they need to climb the career ladder in their respective industries. This is a serious concern, as it could lead to the creation of another lost generation.
This time let’s take the parallel from Japan. The Japanese economic crisis started in 1990 and was ten years of slow to negative economic growth. Japan’s economy had grown rapidly in the decades following World War II, peaking in the 1980s with becoming the second largest economy just next to the USA. People were talking about Japan, the same way we talk about China today. However, in the early 1990s, the Japanese stock market crashed and a debt crisis began, halting economic growth and leading to the “Lost Decade”. During this period, Japan’s GDP averaged only 1.3%. The Japanese economy suffered from both a credit crunch and a liquidity trap. Before long Japan was being called the “Sick-man of Asia”.
The manner this crisis brought down a total generation was unprecedented. This was due in part to the unique nature of Japan’s working culture, which is based on the principle of shushin koyo, or lifetime employment. Under this system, most Japanese companies recruit only fresh graduates once a year, and employees are expected to stay with the same company for their entire careers. Promotions are based on seniority, and there is little opportunity for lateral movement or job hopping.
Understandably, the “Lost Decade” led to a sharp decline in the number of jobs available in Japan. Many companies froze their hiring. They did not take anybody for almost a decade. This left many recent graduates without any prospects for employment. Even those who were lucky enough to find jobs were often faced with stagnant wages and limited opportunities for advancement. As a result, a generation of Japanese workers was effectively locked out of the labour market. Their only fault was being born at the wrong time. They were eventually forced to spend their life in low-paid jobs, sometimes even part-time. Many of them never married, or built families, without having a source of income to run a family. Today, 14% of the population – or 17 million in total – is considered the “Lost Generation” in Japan. Some of them have forced themselves into a condition known as ‘hikikomori’ in Japan, known as severe social withdrawal, that is withdrawal from society and seeking extreme degrees of social isolation and confinement.
The unfortunate reality is that Sri Lanka’s future will not be too different from this. The writing is already on the wall. While the political leadership seems to be content with the future, the reality is grim. India, our neighbour and economic powerhouse, is rapidly industrializing itself, which will rob us of many opportunities in the coming years. This could further jeopardize Sri Lanka’s growth if we fail to make serious changes to current policies.
As I have emphasized in multiple previous articles to this magazine, Sri Lanka had an opportunity to avoid this scenario by following a rapid industrialization-oriented policy like Korea and Malaysia have done at some point during their development journeys; however, this window of opportunity appears to be closing with each passing day. To maintain anything above 3% average growth for the next ten-year cycle would require a miracle without drastic policy shifts on our part soon—something that seems unlikely given our current trajectory and lack of action towards changing it thus far.
For Sri Lanka’s prospects not to look too similar as they do now, we must take steps towards reorienting ourselves economically so that we can better compete against larger countries such as India who are quickly becoming dominant forces in various industries around the world today–and tomorrow. We need strong leadership willing to invest heavily into research and development initiatives along with other long-term strategies aimed at increasing productivity levels across all sectors while also creating more job opportunities for citizens throughout the country if there is any hope left in avoiding an even bleaker outlook than what already awaits us down the line ahead.