AN EMPIRICAL ANALYSIS OF THE DETERMINANTS OF YOUTH INFORMAL EMPLOYMENT IN SRI LANKA

Abstract

This study analyses the determinants of informal employment with a special focus on youth by examining the factors associated with the probability of youth’s participation in informal employment in Sri Lanka. We used Sri Lankan Labour Force Survey micro level data set in 2019, employing multinomial logistic regression modelling to investigate differential impacts of socio –economic determinants of informal employment. The results suggest that informal employment is significantly affected by a range of demo graphic and spatial characteristics variables of individuals used in the study. The overall results indicate that among the explanatory variables age, education marital status, location, gender, sector, religion, ethnic group, economic sectors ,firm size have significant contribution in predicting the dependent variables that is youth’s entry into informal employment. All in all, this study emphasizes the importance of identifying informal employment in formal sector in national statistics and of concentrating on education, literacy, and heads of household– particularly the ones who are married and non-married - in programs aimed at improving employment conditions of youth.