Vocational training has been one of the major topics of discussion for policymakers in India for the past couple of years now. The country’s population is expected to reach 1.3 billion over the next six years (by 2020), with almost 60% being in the employable age group of 15-59 years. A research by Boston Consulting Group has also estimated that, by 2020, India will have a surplus of around 47 million of the active population. Simply said, this means that we will have a remarkable 60% of total population available for working and contributing towards GDP, but out of this total pool, only 25% will find employment in the job market.
According to several research reports, there would be a demand-supply gap of 82-86% amongst the core professions. The IT industry is likely to face a shortage of up to 3.5 million skilled workers. Similar fate can be predicted for almost all the other primary sectors. The demand for skilled workforce will not only be restricted to traditional sectors like auto and BFSI but also include sunrise sectors such as organised retail. Construction and manufacturing are just some of the large-scale sectors where there is an alarming shortage of skilled labour. Construction companies, for example, were forced to import labour from China to complete the planned Commonwealth Games projects. There is a growing pool of urban professionals with more money than time who are eager to hire skilled electricians, plumbers, tailors, cleaners and carpenters, but these trades remain poorly trained and organised as are the staff of restaurants, hotels, spas and salons which are rapidly multiplying. Demand for such a workforce has begun to reach tier two and three cities, thus pumping up the demand for skilled service professionals. Such opportunities would be great news, except only 10% of Indians between the ages of 15-29 receive formal vocational training.
In short, while our market/economy grows and creates an increasing number of jobs which require skilled and trained manpower, a huge scarcity of this very resource is what we will be faced with.
The problem is further compounded by the fact that rather than witnessing a growth in the number of vocational training institutes, one is seeing a sharp decline in the quality of education being provided. Numerous engineering/computer education institutes are testimony to this fact. Most of these are driven more by the business opportunity they present rather than the ability to impart any skill-sets worthwhile of earning employment for its graduates. Therefore, despite having undergone vocational training at fairly substantial costs, the Indian youth is still failing to garner skills for contributing to the growth of the economy; making both the youth and the economy eventual losers.
What, then, is India to do to give a facelift to its skills landscape?
Research has shown that it is a nation’s success or failure in realising the economic potential of young people during this ‘low dependency ratio’ period that can make the difference between sustained and faltering long-term development. Skill upgrade can no longer be ignored if we want to reap the demographic dividend of having a working population of 800 million.
The government is taking some initiatives. The National Skill Development Corporation (NSDC) and National Vocational Education Qualifications Framework (NVEQF) are surely steps in the right direction. However, for this effort to be successful and sustainable on a large scale, industry/corporate sector should own the skill enhancement/intervention programmes. Managing such a huge inflow of candidates across domains every year is a gargantuan task. It needs joint efforts from all entities of the skill ecosystem. An effective use of the new Companies Bill mandating corporate social responsibility (CSR) might come handy if only CSR initiatives are result oriented and measurable.
One way to train this deluge of unskilled population is to create a nationwide network of affordable community colleges with courses and diplomas closely tailored to the skilled labour market. In fact, it would be better if the courses in these ‘colleges’ are designed keeping in the mind the needs of the local markets. These would not only help in creating opportunities where people live, it would also check the unsustainable migration to big cities. In rural areas, where poor children are forced to drop out of the education system due to several socio-economic reasons at a very early age, vocational training can be incorporated into post-elementary education. In fact, the government can also consider an ICT-based long-term plan for addressing the skill requirements by involving key stakeholders.
Perhaps a mandate for the industry such as the ‘Companies Bill’ by the major industry bodies in India to work closely with NSDC, NVEQF, along with universities to encourage innovation, help improve skill levels and address employability challenges may solve the issue of skilled workforce in India. In fact, depending on demand, some vocational courses could be converted into full-fledged ITI/diploma courses. There are several examples across the world of strong industry-academia relationship resulting in mutual benefits. India just needs to learn from them or even replicate some of them.
The author is CEO & director, Centum Learning Ltd