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Sri Lanka’s middle class is fleeing their country

Ahigh During Sri Lanka’s economic crisis last year, only the immigration department had long queues to buy fuel and gas. It issued nearly 875,000 passports in 2022, an all-time high. Most of the people outside this unassuming building in Colombo were not looking for a post-pandemic getaway, but workers eager to escape shortages, inflation and uncertainty.

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Official records show that by 2022, 300,000 of Sri Lanka’s population of 22 million will go abroad to work, mostly low-skilled and semi-skilled workers. From January to March this year, another 73,000 people left. There is evidence that middle-class professionals are now joining the exodus.

Business leaders in many industries say they are cutting jobs, including managers they need to train replacements.Companies are used to churn among 20-35 year-olds — especially in it and other in-demand occupations—but now experienced workers in their 40s and 50s are taking off.

The protracted crisis in Sri Lanka has given them many reasons to leave. The annual inflation rate was 50.6% in February. Even as taxes climb, wages are far from keeping up. In January, President Ranil Wickremesinghe implemented more rate hikes to address International Monetary Fund— last week approved the long-awaited $2.9 billion package for Sri Lanka — described as “one of the lowest-income countries in the world.” The top income tax rate is 36%, which is still modest. Still, the opposition National People’s Power Party may be right in predicting that the tax hike would lead to the “biggest brain drain” in Sri Lanka’s history.

Rajitha Seneviratne, a 37-year-old air traffic controller, said foreign recruitment agents were recruiting young professionals on social media and he was considering job offers from the Middle East. Last month, his union warned that air traffic control could collapse if “four or five” members left.

Thousands of young people it Workers have also been evacuated, which could affect one of Sri Lanka’s fastest-growing industries. Hundreds of doctors have left, including 477 between January and August last year. Continued exodus could cripple rural hospitals. Mr Wickremassinger is said to have quipped that soon “there will be no one in the hotel to serve a glass of wine”.

However, the government is actively encouraging outflows, both to ease public sector wage bills and to increase remittances, Sri Lanka’s largest source of foreign exchange. The fugitive doctors are taking advantage of a government facilitation for public sector workers introduced last June: up to five years of unpaid leave if they find work abroad and send $100 to $500 a month.

Foreign Employment Minister Manusha Nanayakkara is experimenting with various schemes to push Sri Lankan workers overseas. His office advertises foreign government job openings on social media. A WhatsApp group and YouTube channel called “Rata Yamu” or “Let’s Go Abroad” advertise jobs available to Sri Lankans through state-run employment agencies.

The government is also stepping up training for nursing, caregiving and other occupations in demand by Sri Lankans abroad, especially in Kuwait, Qatar and Saudi Arabia, where more than 40 percent of registered migrants went last year. New vocational training centers are being opened, some with the support of the private sector.

These policies appear to be having the desired effect. Remittances, which declined last year, have increased over the past four months. However, there is a clear danger that Sri Lanka, by pushing its brightest minds away, is depriving it of the talent it needs to rebuild at home.

Mr Nanayakkara acknowledged that there were already skills shortages in the manufacturing and hospitality sectors. Some private companies have rolled out modest countermeasures.Some it In fact, companies have already rolled out loyalty bonuses for employees. A large tea company called Dilmah Ceylon Tea is reporting a recent tax hike for its workers.Even so, it says CEO, Dilhan Fernando said the “uncertainty of not knowing what tomorrow will bring” was still a strong reason for them to immigrate.

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