📈 Graduate Growth Falls Short of Sri Lanka’s Skill Needs: IPS Report

Sri Lanka’s tertiary education sector is expanding too slowly to support a productivity-led economy, according to the Institute of Policy Studies (IPS) 'State of the Economy 2026' report. • Overall Growth & Global Standing: The share of tertiary-educated individuals rose from 4% in 2012 to 6.8% in 2024, while STEM graduates grew from 27% (2016) to 31% (2023). However, annual sector growth (~1%) trails upper-middle-income peers and needs to reach ~4% to remain competitive. • Workforce & Skill Gaps: While total knowledge workers match regional trends, only one-third hold tertiary qualifications, dropping to below 25% among technical and associate professionals. Growth is heavily concentrated in first degrees, leaving critical shortages in postgraduates and specialized practical technicians for key sectors like biotechnology, data science, and renewable energy. • Gender Disparities: Women constitute 57% of tertiary-educated individuals but remain heavily concentrated in teaching roles due to labor market preferences and conditions, highlighting underutilization of female skills across broader corporate and technical professions. • Recommendations: IPS calls for expanding tertiary education capacity, aligning graduate output with market demand, improving working conditions to diversify female employment, and boosting job creation to curb brain drain.