The National Policy for Skill Development and Entrepreneurship 2015 which supersedes the policy launched in 2009 has been launched with the primary objective to meet the challenge of skilling at scale with speed, standard (quality) and sustainability.
The challenges faced by the demand and supply side in the Indian skilling space are well known today. Little is known however on why are the stakeholders not able to overcome these barriers. Not acting upon them may gradually lead the youth to an uprising like the Arab Spring. To avoid reaching that stage, we need to engage an estimated 12 million youth being added to the workforce every year meaningfully. And this can be done only when we are able to create jobs at the same pace. Currently the organized sector offers 1.5 – 2 million jobs per year and that is clearly not enough. The new government’s Make in India initiative has definitely helped in boosting job creation. And the latest statistics from a Labour Ministry survey – that shows a 118% increase in job creation in the July - December 2014 period – does endorse that. However job creation or rapid economic growth alone does not ensure jobs for the youth because of several other challenges involved.
The first challenge is to connect the youth to where the jobs are. While the youth population is condensed in the states of UP, Bihar, West Bengal, Chattisgarh, Jharkhand, most of the jobs that are getting created are on the western and southern side in the states of Gujarat, Maharashtra, Andhra Pradesh, Karnataka. This results in migration and that creates an expectation in terms of improved salary, better living conditions, medical care etc. Given this scenario, though the training providers are able to place the students into decent jobs, their retention becomes a huge problem.
The second challenge is in terms of the mismatch between the aspirations of the youth and industry conditions. With the rise in media awareness, social media and the consumer boom the youth approach training institutions expecting a salary of 20,000 or more and a bit of white collared job. Whereas the salary level in the industry is not up to that mark and most vacancies are for entry level jobs. And at the entry level, the minimum wages in Delhi NCR for example is around 8,000 rupees which is lower than the youth’s expectations thus causing a wide mismatch.
The third big challenge is in terms of employer/industry engagement. The industry needs to make much more investment into skilling and become an integral part of the VET system in India. In China, industry participation in vocational education and training is ensured through the 1996 Vocational Education Law.
Article 20 from the Chinese Vocational Education Law 1996 states: “Enterprises shall, in accordance with their actual situation, provide vocational education in a planned way for their staff, workers and persons to be employed. Enterprises may jointly run or run on their own vocational schools and vocational training institutions; they may also entrust vocational schools or vocational training institutions with the vocational education of their staff, workers and persons to be employed by them.”
While 85% of the training in China is industry sponsored corresponding to about 39% in India that too has been brought about after the formation of NSDC and its ardent efforts. And it is not only industry’s financial investment into skilling that is required but also the recognition, in the form of paying a premium to a skilled employee, needs to be practiced by the employers. It is only when the industry starts hiring skilled and certified manpower, will there be greater acceptability of vocational courses among the masses.
Though the recent approval of the Apprentices (Amendment) Bill 2014 by both the Houses of Parliament and the launching of the Apprenticeship Protsahan Yojana are major strides ahead in making the employers an integral part of the skills ecosystem.
The fourth challenge has been addressed partly by the new government through the Common Norms for Skills Development Schemes that was recently approved by the Cabinet. This was regarding the lack of a consistent, easy to understand and operate, national framework for skilling. There are 20 Central Government Ministries that run their own skill development programmes, each with its own norms for different target groups from Minorities to Tribals and PwDs. The common norms are going to define what are the desired outcomes of a skilling programme, minimum number of hours that will constitute a recognized VET programme, cost norms, monitoring and similar parameters. All of these together would contribute in ensuring the delivery of quality skills development programmes. The Common Norms are going to lay the foundation of a sustainable skills development model in India.
The fifth challenge relates to the affordability of such programmes among the bottom of pyramid groups. And this has also been addressed to a large extent by the government through the introduction of a collateral free Skill Loans system. State Bank of India has already notified the availability of such loans on its website. A large section of the population who are not eligible for any sponsorships under government schemes and do not have paying capacity are going to be hugely benefitted through such loans.
India’s challenge of engaging the estimated 12 million entrants to workforce every year cannot be met by job creation alone. India’s higher education system contributes about 3.5 lakh engineers and 2.5 million university graduates annually to the workforce, an estimated five million graduates remain unemployed at any given time. 8 percent of the total work force in India is employed in the organized sector, while the remaining 92 percent are in the non-formal sector. Hence a lot of emphasis needs to be given to self employment driven programmes, entrepreneurship and training in the non-formal sector. Some of the NSDC training partners have already started to do so by introducing courses in Agri Skills, Entrepreneurship programmes for rural women, artisans and craftsmen, and livelihood generation programmes.
It is expected that the ageing economy phenomenon will globally create a skilled manpower shortage of approximately 56.5 million by 2020 and if we can get our skill development act right, we could have a skilled manpower surplus of approximately 47 million. The Skill India mission with the Prime Minister at the Apex coupled with a framework to deliver training in the non formal sector and a system that will boost entrepreneurship and self employment can lead India to become the Skills Capital of the world!
