Abstract:
The leasing industry is booming. This study aims to examine the impact this industry has on employment in the Jaffna
District which suffered badly due to the civil war which ranged from 1983 to 2009. Ever since the war ended financial
institutions have made their presence felt in a large way in the district. Leasing is a major function of the 39 financial
institutions which presently operate in the Jaffna District. A study was conducted on 331 leasing clients who were
randomly selected and the data was collected using a pre tested questionnaire. Poisson regression models for
employment was developed to study the effect of leasing on employment. The results show that leasing has positive
impact on employment. The study has found that 72.8% of leasing facilities were offered to transport sector and out of
the leased facilities 39.9% were seized. The findings of regression analysis show that on average if a lessee is self employed and invested lease facility in own business will earn monthly around 40,000 rupees greater than those who are
not self-employed and not invested lease facility in their own business. Increasing leasing amount alone will not create
employment significantly, while holding other variables constant. If a lessee is self-employed and invested lease facility
in own transport business will create employment two (2) times greater than those who are not self-employed and not
invested lease facility in their own business. The study recommend the leasing companies to carefully study the initial
income, asset and debt of the lessee and whether lessee is self-employed and willing to invest in own business before
providing leasing facilities to the lessee and the leasing amount is sufficient for the lessee’s own business to operate.
