Skills for the Future
Monday 14th November 2011 - 12:15pm - 1:30pm
How can India harness its potential through skill development?
- Vocational training
- Job shortage
- The private sector should be more proactive in providing skills training and creating an ecosystem where workers are motivated to acquire skills
- The National Policy on Skill Development of 2009 has the potential to be a game changer
- Training needs to be certifiable and fungible
By 2020-2025, India needs to educate 700 million workers, 500 million of which should be trained vocationally while the remaining 200 million need a university education. India’s demographic dividend could turn into a nightmare if the young have no jobs or are in suboptimum jobs. Urbanization and increasing productivity in agriculture will create a large pool of surplus labour that the manufacturing sector must absorb. Within the industry, small-scale enterprises must increase their share of employment, because in all successful economies small enterprises are the largest employers.
Just 20 of India’s high-growth sectors will need nearly 200 million trained workers over the next 10 years to be able to sustain the 2008 rate of growth. Many employers at present run in-house training programmes for fresh hires because even those who have had formal education lack skills for the real workplace. In the near future, it may become more competitive to outsource training, creating a US$ 20 billion entrepreneurial opportunity in the training space.
The three main steps required for creating skills and jobs are policy impetus, entrepreneurial energy and a friendly ecosystem created by the private sector to absorb all the trained talent. A systemwide transformation, starting from the provision of basic education and creating awareness of the benefits of vocational studies through the availability of certified training programmes and a private sector commitment to hiring the trained workers, is imperative.
The government, NGOs and the private sector all have a role to play in the education and skill-creation space. The private sector is hesitant to offer training programmes because they are not widely recognized and they fear skilled employees will be poached by competitors. However, pilot studies in India have shown that the attrition rates of workers a company has trained are lower. CREDAI, a construction industry federation based in Pune, took content from its partners and devised a training programme for construction workers who were trained for two hours at the end of every working day. Their performance improved, and retention rates were high.
At the base of the pyramid, where workers for many sectors including construction are situated, even basic education is not readily available. At the same time, for cultural reasons vocational education is looked down upon, as people prefer white-collared jobs to manual work. It is necessary to increase the “aspiration quotient” in this segment of the population. Technology can play a large role in spreading access to skills training and reaching people on online and mobile platforms.
The National Policy on Skill Development, announced in 2009, contains detailed information on what industry, government, trade unions and NGOs should do. The government’s perspective is to create an ecosystem where skills can be imparted and skilled workers absorbed in jobs. It aims to move away from delivering skills training and to restrict itself to financing it. It is promoting skills creation and setting up the National Skill Development Corporation shows policy impetus.
This summary was written by Madhur Singh. The views expressed are those of certain participants in the discussion and do not necessarily reflect the views of all participants or of the World Economic Forum.
Copyright 2011 World Economic Forum
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Keywords: India Economic Summit, skills, vocational training, employability, job shortage, National Policy on Skill Development, National Skill Development Corporation, technology
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