Overview of the Skilled Work Force in India
India, with an average age of 29 years, arguably has the youngest workforce when compared with advanced and other developing economies of the world. According to the Indian Labour Market Update of ILO, July 2016, India has the largest youth population of about 350 million aged between15-29. Coupled with a start up boom since 2015, and a huge range of sectors in the economy, it needs to reap benefits of its demographic dividend by investing in education and skill development of the younger population. This would enable India to achieve and maintain a high rate of economic growth.
However there are several challenges to realise its full potential. According to Indian Labour and Employment Report, 2014:
The Way to Go in Skilling the Young Indian Work Force is:
Start ups offer a ray of hope. But, how do we meet their demands for new skills in emerging sectors.
Recognizing the Limitations of Available Labour -While there has been significant action on improving access to education and training in India, the quality gap persists.
Poor quality of education – As educational qualification increases, unemployment also increases. According to FICCI, 15% of those with a diploma or certificate are unemployed compared to 25 per cent of people with a graduate degree within the 18-29 age group. A similar trend, but a muted phenomenon, is also observed with people above 30 years of age. This may be attributed to the poor quality of education, which does not adequately prepare students or trainees to obtain meaningful employment
Demand vs Supply Mismatch – There appears to be an evidence of mismatch in the demand for and availability of education or skills. The availability of graduate and advanced degree holders are greater than those formally trained to perform lower skilled jobs. However, in terms of sheer numbers, there is far greater number of options available in lower skilled roles.
In order to address the qualitative and quantitative challenges of skilled labour availability, the government must adopt an integrated approach to education in India. There is a pressing need to develop seamless pathways for skill development through formal education, vocational education or both. Allowing the labour force to undertake relevant skill development (formal or vocational) measures and enter and exit the workforce seamlessly will be key. In other words, a dynamic and integrated educational system will facilitate the development of a workforce that can be re-engineered at any juncture to meet evolving economic realities.
Current Skill Development Ecosystem
In India, formal education is delivered through traditional universities and polytechnics. Industrial Training Institutions (ITI) were set up as primary institutions to deliver skill training, focusing mostly on technical trades.
The critical component of industry linkage is missing in the Indian ecosystem and therefore in spite of improved access to education and training – which is evident from rising enrollment rates – quality gaps persists
Overview of the Regulatory Ecosystem
The Indian regulatory ecosystem for skill development comprises central and state government institutions responsible for policy-making and execution, respectively. Key bodies in the Indian context include:
At the National Level –
At the State Level
There are the State Skill Development Missions (SSDMs) which are mandated to develop the State Level Skill Policy, coordinate between various skill training programs and mobilize finances for skill training programmes
Key issues to Skill Training in India
The biggest challenge for India is to provide the right opportunities for skill training to ensure timely availability of skilled manpower. Apart from addressing qualitative and quantitative issues associated with training infrastructure, there remains the challenge to ensure quality of programs/ schemes and make skilling an aspiration for stakeholders
The key issues that are posing a challenge to the skilling ecosystem are
While India has the potential to emerge as the human resource capital of the world, skilling its large workforce and making it employable is a compounded challenge given the low degree of higher education attainment and vocational training. This is further compounded by the fact that India has a workforce which largely works in the informal sector. According to India Labour Market Update, ILO, 2014 about 92 percent labour force is engaged in the unorganised sector or works as informal workers in the organized sector.
The skills/vocational education is not an aspiration for the youth, a majority of people undergoing skills training are doing so either because of lack of opportunities in their fields of interest within mainstream education, family & other financial reasons or because of the stipend/ monetary benefit provided.
From the business point of view, some of the Training Organizations, happen to view skills training as a means to get government funds which to some extent provides reasons for lack of placements for skilled candidates and the issue of quality in training delivery. Skilling ecosystem in India is still in its nascent stage and requires much more support and involvement of both the Government & Private Sector.
Another important stakeholder, the industry neither recognizes the skills certificate issued post completion of short term courses nor are willing to pay a premium for the skills availed. This explains the reason for low placements under the skill schemes.
Many a times, the quality of skills training has been questioned, the industry has indicated a gap between the skills required and what is provided to them, which in turn indicates that there is a wide disconnect between demand and supply of skills.
Short term skilling (2-3 months Skill Training) appears to have a better appeal to youth, although there is sufficient evidence to show that this provides only transient skills which are unable to assure long term employment.
Absence of Convergence and Synergy - In India, there are over 70 schemes under various Ministries/Departments which share a similar objective, “Skill India to make the youth employable and make India the Skill Capital of the World”. In addition, each State Government/ UT has its own Skill Development Schemes/Missions which do not necessarily align with the Central Schemes.
In November, 2014 a new central ministry, Ministry of Skill Development & Entrepreneurship (MSDE) was formed to focus on enhancing employability of the youth through skill development. All skilling initiatives must work in sync with each other to help India achieve the vision of becoming the Skill Capital of the World and a Skilled Labour force provider. To achieve this, the skilling ecosystem needs to be controlled & monitored closely by a single authority which can make and enforce rules & regulations.
This might lead to improved utilization of resources, improved execution, better control on quality and much required flexibility due to changing industry requirements while providing the country with better skilled candidates.
Need of the Hour -One of the biggest challenges that the Skill India mission faces today, is to provide placements/ jobs to a skilled candidates.
Programs like Startup India can surely help the Skill India Mission to address this problem. With proper guidance and encouragement, candidates undergoing skilling can be motivated to establish their own businesses and be called “Self-Employed” than employed.
For a country like India, where lacs of citizen enter the labour force every year, the country is in dire need support from some of its citizens to take the road less travelled and “Become a Job Creator rather than a Job Seeker”
With advent of increasing automation in industry (Industry 4.0), there is a strong possibility of job losses in both Manufacturing and Service sectors like engineering, automobiles, IT/ITES and Banking. The major impact of this would be in job roles at the bottom of the pyramid.
However, it is also likely that new avenues and demand for a different cadre of technologically advanced skilled labour would emerge. India needs to customize its course content & delivery mechanism to make the workforce future ready and enable them to face the shift in job requirements.
Current skill sets of the Minority community can be split into common / menial jobs and specialized jobs. Official Statistics reveal that:
Way to Go
Automation
With the increasing population, job opportunities on the decline and with various industries progressing towards automation, there is bound to be a shift from job creation to job losses. The majorly affected would be the bottom of the pyramid/front line employees. Shift in job requirements can only be successful when workforce is multi-skilled and future ready.
Integration of education with skill training needs to be the focus. As for the currently employed ongoing skill up-gradation will enable them to remain relevant to the industry as new technologies emerge.
Entrepreneurship
In support of workforce participation, opportunities for budding entrepreneurs are growing and these can be harnessed with funding and mentorship at all stages – early stage to scale up stage.
Create Equal opportunities for men and women to develop a balanced workforce
Recognizing emerging and evolving markets and develops a networking mechanism by which entrepreneurs get exposure. Finally, increase retention rate of existing employees through enhancement of their skill sets. An important emerging aspect of HR management is an ongoing skill up gradation programme for employees
Education Infrastructure
At the high school level itself there is a need to introduce programmes which enable recognizing needs & strengths of students and subsequently empower them to enhance skill sets aligned to their interests.
Explore the scope of partnering with government schools for these initiatives.
Skill Building & Steps to be taken
Focus on sectors/ verticals which are in high demand like Pharma Sector, I.T, Leisure, Transport, Energy, Education, Finance, Agriculture, Health & Nutrition
Strategy
Industry Tie Up
Employer Sponsored Training is a good way to go as it guarantees placement at the end of the training period. Manpower Companies like TMI in Hyderabad adopt this strategy. Also companies like Big Basket, Swiggy, Retail Chains etc should be targeted to train and place individuals
Companies engaged on Rural Infrastructure Development have scope for absorbing large number of workers skilled in sectors like sanitation, energy, water supply etc. A good example in EWOB
Also look at companies which take on student interns. This is a good way to expose young people to the industry while they are still students.
Tap into CSR funding as these focus on imparting industry relevant skills.
Government has allocated substantial funds for Skill Development and these can be tapped through NSDC accredited Skill Building Centres.
Since there is a large focus on infrastructure development in rural areas, there are several NGO run Skill Development Initiatives with which we can tie up.
Co-ordinated Approach
With many of ICCI’s established chapters in India, we should encourage all centres to share best practices. Focus on expanding network and promote involvement of more upcoming chapters.
This will result in better outreach and more referrals for employment and skill training within the ICCI circles.
Women Empowerment
To tap into the currently large dormant workforce we need to focus on empowering women to move away from the traditional “women occupations” – tailoring and beauty services to other more long term sustainable employment opportunities in the field of Health, Education and Retail for example –