By Asoka S. Seneviratne –

Prime Minister Dr. Harini Amarasuriya, as the Minister of Education, has presented an array of education reform measures along with her expertise, deep knowledge, and experience, and her utmost commitment and dedication to the subject matter. It is indeed highly commendable and valued. President Anura Kumara Dissanayake, in his versatile speech in the Parliament, clearly and extensively explained that reforms will not be confined to revising the curriculum. But a fundamental transformation of our entire society, the economic body, and the country. What we have seen via social media is a Power Point presentation (PPT) as a draft of the reform measures, which may be the tip of the iceberg.

Education reform is more than just an academic effort. It is a transformative investment in a nation’s economy, social mobility, and future resilience. However, Sri Lanka’s current reform proposals mainly concentrate on curriculum updates and administrative changes without addressing the broader human capital framework. Given the above, the purpose of this article is to present a comprehensive model that views (i) education, (ii) health, and (iii) social inclusion as interconnected drivers of productivity and national prosperity.

Human Capital: The Missing Core

What is Human Capital?

Human capital refers to the skills, knowledge, health, and values embodied in people, which enable them to contribute productively to society and the economy. It is built through:

* Quality education and training

* Good physical and mental health

* Enabling social environments (e.g., safety, equity, participation)

In both theory and practice, investing in people produces gains in economic growth, productivity, and national competitiveness. It should be noted that labour is one of the four main factors of production (I.e, Labour, land, capital, and entrepreneurship) of which overall linkages are massive.

Labour Market Dynamics: Why Supply Must Meet Demand

Similar to other inputs in production, labour is sold and bought in the labour market. The mismatch between the supply of educated youth and the demand for relevant skills is a critical policy failure in Sri Lanka:

* Thousands of graduates are unemployed or underemployed. Also, others who left schools with O/L and A/L. This affects economic growth, as actual output is less than potential output, which is a key strategy in the country, as we are always talking about stimulating economic growth.

* Technical and vocational sectors have remained stigmatized and underfunded, a reform area since the 1960s.

* Employers report acute skill shortages in key sectors (IT, healthcare, construction, agri-business). For this reason, FDI has been affected, which in turn has impacted economic growth.

A reformed education system must address both ends: preparing a skilled workforce and enabling a labor market that absorbs it effectively. In theory, or in General Equilibrium, the labor market also needs to clear. Not having this equilibrium in the country is a tragedy.

Assessing Education Reform Through a Human Capital Lens

Strategic Policy Gaps in the Current Reform Agenda

• Lack of a Human Capital Strategy

The proposed reforms fail to recognize education as part of a comprehensive human capital development strategy. Key elements such as student health, nutrition, psychosocial support, and social protection are missing from the school system. There is no national plan to coordinate education with health and social services, especially for vulnerable communities. Without these investments, students’ cognitive and emotional readiness suffers. Schools should serve not only as academic institutions but also as centers for human development.

• Neglect of Labour Market Alignment

The current curriculum reform process operates primarily in isolation from labour market realities. It lacks mechanisms to identify evolving skill needs or integrate feedback from employers, industries, and professional bodies. As a result, there is a growing mismatch between what students are taught and what the economy demands. Sectors like ICT, renewable energy, and healthcare face persistent skill shortages while thousands of graduates remain unemployed. A dynamic skills mapping system is urgently needed to guide curriculum relevance.

• Insufficient Evaluation Mechanisms

There is no national system in place to track the long-term results of education reform. Graduate tracking systems, labor market entry data, and earnings trajectories are not consistently collected or analyzed. Without this feedback, policymakers cannot evaluate how well reforms are providing employable skills or promoting socioeconomic mobility. It also hinders evidence-based budgeting and targeted solutions. Assessing education should go beyond exams to include real-world transitions.

• Overemphasis on Schooling over Learning

The reform agenda still emphasizes enrollment, exams, and infrastructure over the quality and relevance of learning. Students often move through the system without acquiring essential skills—such as (i) critical thinking, (ii) digital literacy, (iii) problem solving, or (iv) communication. Additionally, rote memorization remains common in classrooms, leaving students unprepared for real-world challenges. Effective education reform should shift from merely counting inputs to measuring genuine competencies, creativity, and employability outcomes.

Recommendations: Repositioning Education as a Human Capital Strategy

(i) Adopt a Human Capital Index Framework

Sri Lanka should adopt a localized version of the Human Capital Index (HCI) to systematically measure and compare human capital development across provinces and districts. This index should combine indicators such as learning-adjusted years of schooling, child survival rates, adolescent health, and equitable access to education. By capturing both the quantity and quality of human capital, the HCI can reveal regional disparities and development gaps. These insights should directly inform policy decisions and guide the allocation of resources to underserved areas. Over time, it would allow the government to track progress, target investments more effectively, and ensure no community is left behind in national development.

(ii) Develop a National Graduate Tracer System

A robust Graduate Tracer System should be established to systematically track the employment status, earnings, job satisfaction, and migration patterns of graduates from universities, technical institutes, and vocational training centers. This data would provide critical insights into how well the education system prepares students for the labour market. It would also help identify which fields of study lead to meaningful employment and which are producing underemployed or jobless graduates. By linking education outputs to real-world outcomes, policymakers can adjust curricula, funding priorities, and career guidance systems accordingly. Such a system is essential for evidence-based reform and long-term return on education investment.

(iii) Establish a Skills Intelligence & Forecasting Body

Sri Lanka urgently needs a dedicated “Skills Foresight Unit” to anticipate emerging skill demands across key sectors such as  (i) the green economy, (ii) artificial intelligence, (iii) digital services, (iv) advanced manufacturing, and  (v) the expanding care economy. This unit should conduct regular labour market intelligence, horizon scanning, and stakeholder consultations with industry, academia, and trade unions. Its forecasts would inform curriculum design, teacher training, and career guidance to align supply with future demand. By preparing today’s learners for tomorrow’s jobs, Sri Lanka can avoid chronic skills mismatches and build a workforce ready for economic transformation. This unit should be embedded within the Ministry of Education or Labour and work in tandem with national planning bodies.

(iv) Integrate Health and Social Services in Schools

Schools must evolve beyond their traditional academic role to become holistic development hubs that nurture the physical, emotional, and social well-being of children. Integrating (i) school meal programs, (ii) health screenings, (iii) psychosocial counseling, and (iv) community outreach initiatives into the education system can significantly improve learning outcomes and equity. These services are especially critical for disadvantaged and rural students, who often face barriers to accessing basic care. By embedding support systems within schools, we build resilient, healthy, and socially aware citizens. This whole-child approach lays the foundation for long-term human capital development and inclusive national progress.

(v) Link Education Reform to Labour Market Institutions

Sri Lanka’s Technical and Vocational Education and Training (TVET) system must be reimagined to become aspirational, modern, and closely aligned with labour market needs. Strengthening public-private partnerships is essential to develop dual training models where students split time between classrooms and real-world work environments. Industry-led curriculum co-design ensures that training content is current, practical, and responsive to technological changes and employer expectations. Expanding apprenticeships in key growth sectors—such as construction, ICT, hospitality, and green energy—can provide youth with pathways to secure and dignified employment. A demand-driven, competency-based TVET system will enhance productivity, reduce youth unemployment, and uplift national competitiveness.

(vi) Equity First: Prioritize underserved regions and groups

Equity in education cannot be achieved without targeted investment in historically underserved regions—especially rural, plantation, and conflict-affected districts. These areas suffer from chronic underfunding, shortages of qualified teachers, poor infrastructure, and limited access to early childhood and secondary education. Special attention must also be given to closing gender disparities, supporting girls’ education beyond primary school, and ensuring children with disabilities have inclusive learning environments. National education reform must adopt a territorial and social justice lens to bridge these gaps. Doing so is vital for reducing intergenerational poverty and achieving inclusive, sustainable development across all regions.

Summary & Conclusion

Sri Lanka’s proposed education reform agenda seeks to modernize the system to meet the needs of a dynamic economy, which is highly commendable and valued.  However, it lacks strategic alignment with the core pillars of (a) human capital development, (b) labour market demand, and (c) inclusive economic growth. This paper argues that education must be reframed as a national human capital investment strategy—(a) integrating health, (b) social development, and (c) labour market realities, not just employment alone.

Unless reform is refocused to build employable, healthy, and socially capable citizens, Sri Lanka risks perpetuating skill mismatches, youth underemployment, and social inequity—undermining long-term development, particularly integrating into the fast-moving global economy.

Sri Lanka stands at a pivotal moment. Education reform must go beyond structural tweaks and evolve into a whole-of-society human capital transformation strategy. Only by uniting education, health, social protection, and employment policy can the country unlock the full potential of its people—and ensure inclusive growth and sustainable development. The measure of success will not be just higher test scores, but healthier, employed, and empowered citizens who actively shape Sri Lanka’s future.

This calls for courageous policy thinking—anchored in data, equity, and long-term vision. Reform should not simply fix what is broken, but reimagine education as the engine of national resilience, productivity, and cohesion. Investing in the human capital of every Sri Lankan—regardless of gender, geography, or ability—is the most powerful way to future-proof the economy. Now is the time to act boldly, listen to evidence, and build a system that transforms lives, not just classrooms.

*The writer, among many, served as the Special Advisor to the President of Namibia from 2006 to 2012 and was a Senior Consultant with the UNDP for 20 years. He was a Senior Economist with the Central Bank of Sri Lanka (1972-1993), asoka.seneviratne@gmail.com