Skilling: The way forward

India's youth desire jobs that have prospects for upward mobility, and our skilling schemes must be crafted to meet their aspirations

A well-recognised paradox in our country is that ours is a labour-surplus but skill-shortage economy. At the same time, we do export some skills and professional talent, thereby earning $79 billion in 2018 as foreign remittances. Therefore, skill shortages in some sectors are perhaps more a result of relatively low wages in the domestic economy. In other sectors, these would be a result of supply shortages.

It is evident from the worldwide experience of extensive public sector intervention that given the “public goods” nature of human resources development, a purely market-based skill generation system will be inevitably characterised by supply shortages. This pushes up wage costs higher than warranted by the country’s demographic and workforce profile. For these reasons, the Indian government has also intervened extensively at all levels of education for ensuring adequate supply of skills. As a part of these efforts, the National Skill Development Corporation (NSDC) was set up in 2008, on the public-private partnership (PPP) model. It was moved, in 2015, to the Ministry of Skill Development and Entrepreneurship (MSDE), which owns 49 per cent of NSDC’s equity. The majority is held by private partners. The Skill India programme was launched in 2015.

Since its establishment, the NSDC has expanded its presence across the country. In the process, it has acquired 443 training partners; opened 8,503 training centres; prepared 1,870 job descriptions; worked closely with 38 sector skill councils; and has trained nearly 9.9 million persons. Its placement record shows that its private sector training partners found jobs for about 47 per cent of their trainees. Under other government schemes, placement has been a mere 15-18 per cent. Additionally, 19 other ministries run another 44 schemes. Some collaboration between the MSDE and some of these ministries has recently been initiated as reflected in the collaboration between Skill India and a few line ministries like Agriculture, Sanitation and Drinking Water and NITI Aayog’s Aspirational Districts programme.

It has not been easy to find jobs for those trained under various schemes. Either jobs on offer do not meet the trainee’s aspirations or skills acquired do not match industry requirements, which are in great flux due to tremendous pressure on the domestic industry to adopt new technologies being spawned by Industry 4.0. It would, therefore, be virtually impossible to satisfactorily gauge the volume and quality of demand for different skills across the economy’s spectrum. Any attempt to anticipate emerging skill requirements for an economy as technologically dynamic and open as ours is bound to consistently and significantly fall behind the curve.

It is also worth recognising that present skilling programmes generally do not offer possibility of continued up-grading of skills and a movement up the skills-talent ladder. They could be perceived as an inferior channel for the much desired upward mobility. The palpable risk is that the extensive NSDC training network may meet the same fate as Nai Taleem. This programme, conceived of in the latter fifties, died an early death because, despite famous proponents like Zakir Hussain and K D Shrimali, it was seen as consigning the trainees to a lifelong inferior status of vocational workers with no prospect of upward mobility.

There is thus an urgent need for thinking of alternatives. Apprenticeships, combined with a system of continued education that allows candidates to improve their skill and education profile may well be the way forward. The 1961 National Apprenticeship Law stipulates that apprentices should make up a minimum of 2.5 per cent of the workforce and this figure can go up to 10 per cent. At present, apprentices probably account for less than 0.3 per cent of the workforce, while China’s is about 1.3 per cent. Germany has 3.7 per cent of its workforce as apprentices. Doubling or even tripling the government apprenticeship stipend amount from the present level of Rs 1,500 and effectively controlling labour inspectors may well be the two necessary conditions for apprenticeship schemes to prosper in our country.

But an even better model is available. Dr Vivek Sawant, formerly deputy head of the Centre for Advanced Computing, Pune (C-DAC, the organisation which successfully developed India’s super computer, Param), accepted the challenge of turning around the Maharashtra Knowledge Corporation Ltd (MKCL), established as a PPP entity in 2001 in Pune. Since 2012, MKLC has been running a successful pilot that successfully combines apprenticeship with continued education.

Illustration: Binay Sinha

By July 2019, a total of 204 students would have graduated from the three-year course offered part-time by MKCL with a BBA degree from the Yashwantrao Chavan Maharashtra Open University. These students, all hailing from the lowest social strata, work five days a week as apprentices in Pune-based companies, after completing three months of job readiness training in digital skills, English language, and other soft skills. They earn a stipend of Rs 8,000 (which makes the scheme attractive to young trainees who also send a part of the stipend to support their poor parents) paid entirely by the companies from the first day of their enrolment. All the trainees have been given individual laptops and received real-life work experience in industry while also acquiring explicit theoretical knowledge over weekends in courses organised by MKCL. Each one of them was successfully placed in companies like Federal Express, Tata, Amazon, NEC etc with an average salary of Rs 12,000 per month and strong promotion prospects. Currently, 400 students are enrolled. The lesson is that India’s aspirational youth is no longer satisfied with any job. They desire good quality jobs that have prospects for further education and upward mobility. All our skilling schemes have to be suitably crafted.

The pilot run by MKCL is now ready to be rolled out at the national level and at a much larger scale. MKCL is willing and capable of leading the nation-wide effort. The University Grants Commission and the Indira Gandhi National Open University now need to step forward and work with and empower MKCL to offer the programme at the national level. Skill India will also do well to support this programme to successfully launch it nationally. Let's hope that we see this happening within this financial year.

The writer is Vice Chairman , NITI Aayog. Views are personal.