According to the table 7.1 almost 80 percent of employment in Sri Lanka is concentrated in sectors with low productivity. Agriculture and service sectors are the examples for low growth of labour productivity. Average labour productivity in industry and services is double than in agriculture in which about 35 percent of the labour force is employed. Although average labour productivity is higher in the service sector due to high value additions, annual productivity growth in the service sector is lower than in agriculture and industry. Productivity has grown only in the industrial sector. It has increased by 4.07 percent during the period of year 2000 – 2004. A rapid transition from this existing crisis situation is necessary to overcome the challenges in the new millennium.

Such transition will be possible only through productivity enhancement in all sectors. Our past performances in boosting productivity has indeed been relatively poor.

We have entered an era where the traditional pillars of economic power such as capital and labour are no longer the main determinants of success. Instead, success depends on knowledge, competencies technological know-how; problem solving expertise, personal creativity; the ability to innovate; creating new business opportunities and new ways of doing business; exploiting new technologies; and faster and better decision making processes.

The Government should take all possible steps to create an enabling environment to restore business confidence and boost investment in the economy. Government should involve itself in the creation of flexibility in the labour market and provide the infrastructure facilities, which consequently help reduce the unit cost of production. Wages need to be linked to the performance in line with enhancement of productivity. “The low productivity level in the agricultural sector reflects the weak dynamism in the sector due to deep-rooted structural weaknesses. This raises concern, as agriculture still absorbs almost 35% of the total labour force. The ad-hoc policies followed in the past, including restrictions in the land market and the continuation of distortionery government interventions, have worsened the situation. Therefore, effective resolutions to these weaknesses through market base sustainable strategies are needed to improve both agricultural productions” (Central Bank Annual Report 2004).

Our private sector has to participate actively in the efforts towards developing a total quality culture. Some local enterprises and most of the multinational companies have adopted Total Quality Management (TQM) techniques, ISO standards and have established Quality Circles(QC) in order to improve the quality of their products. However the private sector organizations should adopt the new performance management and quality improvement techniques such as Balanced Scorecard and Six Sigma to enhance company performance and to create quality culture in their organizations. Re-organization of working systems are needed to bring substantial improvements in total factor productivity. The private organizations will have to continue its efforts by sawing the seeds for the future improvements and mastering the strategies of competitive trade and business practices. Government should encourage greater competition. This will encourage the firms to be more innovative by way of reducing and providing incentives for the efficient organizations of production and for the adoption of state - of - the art technologies. In this direction the recent decision to have a strategic partner in the telecommunication sector in boosting the development of information and communication and eventually providing overseas communication facilities at more competitive rate is one classic example.

The training institutions and universities have not responded effectively, and adequately to the challenges of developing productivity. Shortages in appropriate skills in the crucial sectors of the economy have become evident and it is already impacting upon growth. We have to take appropriate steps rapidly for an intensive skills development programme to fill the gaps in crucial skill needs in the short - term. Research and development institutions and private sector should gear themselves in a drive towards enhancement of productivity in the economy. Further, the collaborations between universities, R&D institutions and private sector organizations known as the golden trangular, will help to bring great results in productivity enhancement and to reduce the mismatch situation in the domestic labour market.

Our workforce also should play a crucial role in the efforts of productivity improvement. They should be conscious of the fact that could share the productivity gains by way of higher pays, job satisfaction and improved standards of living etc. It is necessary to aim at organizational excellence through employee involvement programmes, which will encourage workers to develop a new work culture geared to enhance productivity. The spirit of gain sharing can help align individual employees’ goals with those of their organizations. When installed and managed properly, gain- sharing plans can widen the employees’ sense of identity and encourage them to be more productive.

Productivity enhancement is indeed a hard nut to crack. It is a marathon race without a finish line. But with the inner conviction of the true obsessive, simple innovative and inexpensive actions with workers on board, we can go a long way towards winning the race against time. But we will have to reframe our agenda to include the efforts to bring the weakest and the most vulnerable from the margins of society to the center stage and encourage and facilitate our workers to be the true stakeholders of national development.

• The time period for newspaper survey was from January to April 2005.

• The newspapers used for the survey were Sunday Observer, Daily News, Silumina and
  Dinamina.

• The newspaper advertisement data was carefully analyzed avoiding repeating
  advertisements.

• The data up to year 2002 obtained from QLFS, Department of Census and Statistics do not include Northern and Eastern provinces, data for year 2003 does include Eastern province but exclude Northern province, and data for year 2004 second
  quarter includes all the districts.

• Data for year 2004 in the historical tables include only the average of first and
  second quarters.

• Composition of employment and unemployment has been calculated by using the
  historical data of the QLFS.

• The advertisements, in which the number of vacancies were not mentioned were considered as one vacancy. Therefore the number of vacancies counted for all occupations may be less than the actual number of vacancies.

• This Bulletin will be issued Bi-Annually.

• The newspaper survey period for the First Bulletin is from November of the previous year to April of the current year, and the period of May to October of the current year is being analyzed for the second Bulletin of the year.