Much has been debated about India’s manpower story. Forecasts suggest that by 2020, about 60% of India’s population of 1.3 bn will be in the working age group of 15-59 years. It is estimated that by 2025, India will have 25% of the world’s total workforce. The real problem is that a big labor pipeline could also set off an unemployment trend of epidemic proportions. But, with adequate preparation, that need not be the case.
There certainly is an urgent need to put in place a well-designed skills development ecosystem. To understand the urgency, take a look at the findings of the Annual Talent Shortage Survey (2015) by Manpower Group: 58% of respondents from India said that filling jobs was difficult (this is against the global average of 38%). This indicates that without appropriate skilling, India will not only have the largest supply of manpower, but also the largest unemployed workforce in the world. The only way to avoid this is by building a skill-focused, industry-ready and job-ready workforce. And the time to start doing it is now.
Skilling 350 million people within the next 5 to 7 years, and continuing the tempo for another 5 years, is not going to be easy. In addition, all skilling initiatives must be in alignment with emerging industry needs and with the overall economic goals.
India’s stated goal is to target a growth in economy of 8% to 9%, with 10% for secondary, 11% for tertiary and 4% for agriculture sectors. This means the skilling programs must be developed with precision to deliver sector specific and industry-ready manpower.
A study has shown that 90% of jobs are skill-based whereas only 2% of the population (in the 15-25 age group) is currently enrolled for vocational training. This is in contrast to 80% in Europe and 60% in East Asian countries. The gap to be bridged is enormous.
And what is our capacity to skill people? At the moment, the number of people formally trained by the Ministry of Labour and Employment is about 1,100,000 a year. Another 3,200,000 are trained by an assortment of central government ministries. That means we have a formal capacity to train 4.3 million people annually as opposed to the need to skill at about 350 million in the next 5 to 7 years.
The solution is multi-level:
· Reduce the number of school and college drop outs. We have 20 to 21 million students drop out of Class VIII. Another 2.2 million drop out at Class X. We must target this group of 23 million through upgraded industrial training courses such as those developed by the Industrial Training Institutes (ITIs)
· Target the women workforce. Currently, India has only 30% of women in the workforce. Other nations have much higher numbers. China for example, has 82% of women as part of the workforce. Create incentives for women to join skilling institutes
· Identify high growth industries and the kind of skills they will demand in the next 5 years, and develop skilling programs around these
· Draw industry into providing internships and infrastructure for on-the-job skilling with certification; encourage and train employees to provide the training
· Develop scalable, re-usable and cost-effective technologies for skilling such as cloud based video learning modules that promote experiential learning
· Create innovative means to access physical skilling infrastructure for promoting community college led vocational learning (such as the use of existing school and college infrastructure in the evening)
Training under the Pradhan Mantri Kaushal Vikas Yojana (PMKVY) began at 1,000 centres across the country last year, covering 50,000 youth in 100 job roles across 25 sectors. This scheme is being coordinated by the recently shaped Ministry of Skill Development and Entrepreneurship (MSDE). Also, an allocation of Rs 1,500 crore for skilling rural youth under the Deen Dayal Upadhyay Gramin Kaushal Yojana along with Rs 1,350 crore allocated for the National Skill Certification and Monetary Reward Scheme (STAR Scheme) had been made. The Skills Ministry has been directed by the Prime Minister’s Office to open 7,000 new ITIs within this year. This means operationalizing 20 new ITI centres each day!
These Govt. schemes and initiatives must continue to augment the development of a skilled force for India to meet the growing talent shortage.
It may be early to examine the results of all the dozens of schemes being launched across the nation. But if they are scalable, we will have taken the first major steps towards harvesting our demographic dividend.