)
An overwhelming majority of Indian companies says the availability of trained workers will be a significant constraint on business. Beginning on Monday, a two-part series looks at the reasons and what various stakeholders are doing to improve the situation
In the coming decade, 12.8 million people will enter the job market every year. However, if industry isn’t enthused by that number, there are reasons for that.
A mere two per cent of the workers are formally skilled, while about 93 per cent working in the unorganised sector are untouched by any kind of formal training, according to the IDFC India Infrastructure Report 2012. In comparison, 96 per cent of the workers in South Korea receive formal skills training. The number is 80 per cent in Japan, 75 per cent in Germany and 68 per cent in the UK.
That’s not all. According to a Boston Consulting Group report, 40 per cent of the current workforce is illiterate and another 40 per cent is accounted for by school dropouts. Those who are vocationally-trained, diploma holders, graduates, etc, comprise a mere 10 per cent of the overall workforce, while those who have completed 12 years of schooling comprise another 10 per cent.
“India has let its youth down on skills development. The public-private partnership (PPP) scheme of industrial training institutes (ITIs) has probably fallen apart, except where co-opted by industrial players,” says Amit Bhatia, founder and chief executive, Aspire Human Capital Management, an Indian social entrepreneurial firm in employability education.
The future doesn’t look too bright either. The National Skill Development Council (NSDC), formed in 2009, plans to skill 500 million workers in the next decade. If that target has to be achieved, the year-on-year training capacity would have to rise to 40–50 million incrementally over the next 10 years. Given industry’s lukewarm involvement and the track record, that seems to be a tall order.
Consider this: At present, net enrolment in vocational courses in India is about 5.5 million a year, compared with 90 million in China and 11.3 million in the US.
“Industry has been lukewarm in skilling its own workforce, with the incidence of in-service skilling being one of the lowest in India. Moreover, industry has not moved briskly on collectively addressing the problem of course curriculum at educational institutions/vocational training centres not being in sync with its requirements,” says Dilip Chenoy, chief executive of NSDC.
One of the key challenges for skills development in the country is 17 ministries are engaged in this, leading to all-round confusion and turf wars. And, many of their skill development initiatives aren’t focused on what industry or employers want.
Most formal skills-related training happens through ITIs and industrial training centres. However, many ITIs have now been brought under the PPP mode, with the private partner responsible for the management of the institution. The goal is to bring all the 1,396 ITIs under the PPP mode. Through private sector participation, 400 of these ITIs are being transformed into centres of excellence.
Though many ITIs are now managed by the private sector, which has modified their course content, lack of scale means not many students benefit from this training. This is also an issue with several vocational training centres run in the private sector.
The poor quality of higher education muddies the water further, with rampant degree mills selling hopes but not delivering quality, leading to disappointment with the system.
One of the primary impediments to skills training is the question of who pays for this. While firms are not inclined to pay a placement fee for rightly skilled persons, in many cases, trainees are not excited by the remuneration offered. In others, people do not even join after a stint of free training.
A typical skill development module would cost Rs 8,000-9,000 for a 200-hour course. While in many cases, students are expected to pay the fee, in some, companies agree to pay part of it. Industry says it is important a student pay for the course, as he/she has to be serious about the training.
In addition, the negative perception on skill training also plays a part. “Parents would rather send their children to do a bachelor’s in arts than for vocational education and building skills. So, the problem is not only of social acceptance, but also lack of interest,” said Shankar S Mantha, Chairman, All India Council for Technical Education (AICTE).
As a result, enrolment in vocational courses does not take place, leading to a low number of skilled people emerging out of these institutions.
To fight perceptions, AICTE has decided to create a national vocational qualification framework — a methodology to build skills, with general academics creating a credit-based approach towards vocationalising higher education.
Social schemes such as the Mahatma Gandhi National Rural Employment Guarantee Scheme have had led to rural folk staying away from skill development initiatives. By being assured of a certain amount every year, a number these people have now started feeling they no longer need to make the extra effort to get themselves skilled.
