School-to-Work Transition of Sri Lankan University Graduates
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they knew. Before 2005, that is, before the government recruitment drive, 8 percent were given the job, and 38 percent were told about the job, by someone they knew. Female graduates had a 60 percent lower likelihood of being employed in the formal private sector than they did in the public sector, although Blinder-Oaxaca decomposition failed to reject equal gender-wage status at the 10 percent level. Moreover, graduates residing in remote locations were shown to be at a disadvantage: each additional minute to a main road increased the hazard of unemployment by 3 percent. Graduates from lower socioeconomic groups were also unemployed for longer periods of time than those who were more socially connected. The result was robust, that is, statistically significant in both duration models.
Value of the Field of Study Our results also show that the field of study significantly affects employability and earning capacity (tables 5.3 and 5.4). A graduate holding a demography or political science degree had longer unemployment duration. A graduate with a specialization in history was likely to obtain a monthly salary that was 62 percent less than that of a graduate with a business administration degree in the formal private sector ( p = 0.01). The comparative differences were markedly reduced in the public sector.
Impact of Labor Market Programs Ninety-six percent of the graduates were aware of Tharuna Aruna, 62 percent contemplated applying to the program, and only 16 percent of them participated. Among the participants, the vast majority—79 of them—obtained placement in government organizations; only 3 were hired by private sector organizations. This is contradictory to Tharuna Aruna’s primary objective of promoting employment in the private sector for the unemployed. However, all participants were able to keep their jobs with the same employers beyond the period subsidized by the program. The government recruitment drive primarily attracted the unemployed, especially the ones who were in “long-term” unemployment (logrank test for survival estimates: p > chi2 = 0.00). Of the graduates who were recruited through this campaign, 85 percent were jobless before the campaign. Around 10 percent shifted from jobs in the private sector without unions, 3 percent from the private sector with unions, and 2 percent from the public sector.