India's workforce is growing - how can job creation keep pace?

Boys are silhouetted against the setting sun as they ride bicycles on the outskirts of Agartala, India, November 21, 2016

India will have the world's youngest population by 2022 - a great resource, if managed well Image: REUTERS/Jayanta Dey

Sergio Picarelli
Executive Board Member, Head of Region, Adecco Group
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This article is part of: India Economic Summit

The secret to empowering a powerful behemoth like India lies in understanding and navigating the intricacies of its complex economy.

The picture is fascinating and complex for an economy that is both expanding quickly – it was the world's 4th-fastest growing in 2016 - and will have the world’s youngest population by 2022. Today, 65% of India's population is of working age. That is a great resource full of great potential - but it raises some parallel concerns.

In 2015, the Wall Street Journal reported that while the Indian workforce grows by 12 million each year, that fresh supply is not met with demand. Only 5.5 million jobs are created annually. And for sure, as the Fourth Industrial Revolution advances, new skill requirements will further challenge India’s young people.

Quality education in India is a privilege for the very few. Primary and secondary education suffer from poor standards and a high drop-out rate. While 35% of Indian postgraduates achieve degrees in the key STEM (science, technology, engineering, mathematic) fields, according to the 2012 OECD figures, these candidates are often hindered in the job market due to limited proficiency in English and a lack of soft skills. India must make sure that its great talent pool becomes both employable and able to contribute towards building a developed nation.

 The more educated you are in India, the more likely you are to be unemployed
The more educated you are in India, the more likely you are to be unemployed Image: LiveMint, UN, Indian Government

Investment in both high-quality formal and vocational education is the priority, and collaboration among public-private partners is a must.

Connecting the dots

To thrive in the diverse geographies and political jurisdictions that make up India, we need to cross borders and sectors to tap into new opportunities and to create private-public partnerships by merging the interests of society with those of business.

The Global Talent Competitiveness Index 2017 (GTCI), which measures countries' ability to attract talent and which is developed by INSEAD and the Adecco Group, ranks India 92nd out of 118 countries. India’s lowest scores are in the index's talent ‘attraction’ category, which is in turn derived from low scores in ‘business-government relations’ and ‘regulatory systems’. The country ranks 74th in the ‘grow’ (talent development) category, with a ranking of 105th in vocational enrolment.

The GTCI 2017 emphasises the key role of connectedness, observing how transformational change is most likely to succeed in a strong ecosystem stemming from close public-private alliances. Collaboration and connectedness must be another key focus for India.

One such example of urban-rural sustainability in India is e-Mitra, a project undertaken by the government of the Indian state of Rajasthan and local service providers to deliver e-government services (forms, information and birth certificates, for example ) to Indian citizens via dedicated centres and kiosks. Another comes from the Puducherry government, which announced in late 2016 that its Department of Information and Technology would provide soft skills training to 5,000 candidates. Conducted in collaboration with the Information Communication Technology Academy, the training will provide candidates with assessment and certification intended to help improve their career prospects.

Similar initiatives in education and upskilling are urgently needed, along with greater collaboration between institutions, school systems and employers to develop education programmes that fit the needs of the market. Switzerland, Germany and Austria have managed this successfully - they are the only countries globally whose youth unemployment figures are at the same level or lower than regular unemployment. The main reason for this lies in the successful cooperation among stakeholders to design educational paths tailored to shape employable skills and meet specific labour market needs. This applies to both technical and people skills, with the latter being learned through work experience and on-the-job interaction.

Building on this learning, the Adecco Group is strongly committed to the development of apprenticeship and other work-based training schemes at a global level. Adecco’s Way to Work programme has provided 15,000 internship opportunities to young people since 2015, for example. We have also actively supported the development of the Global Apprenticeship Network (GAN). GAN’s goal is to combine the expertise and commitment of private and public players, including employers, education systems and institutions to develop apprenticeship schemes tailored to local conditions and needs. Since starting in 2013, GAN has touched the lives of millions of young people globally, from Malawi to Mexico, Argentina to Indonesia. The GAN’s next ambitious goal is 20x20x20: creating 20 million opportunities for young people with 20 companies by the year 2020. There’s no reason why India should not be part of this promising picture.

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Making it easier

Eventually, India’s regulatory framework needs to be simpler and more agile if it is to attract investment and create millions of jobs for its workforce. Despite recent measures, the country’s administration is still too fragmented and bureaucratic, placing India at 103rd out of 118 countries in the ‘ease of doing business’ variable within GTCI 2017.

This also applies to the labour market, which is still dominated by extremely complex labour codes that reduce opportunities for new forms of flexible work.

In a country like India with such vast potential and diversity, the creation of an integrated workforce solution that targets multiple areas is key to the stable employment growth.

Skills, collaboration and flexibility are key to boosting job creation and empowering India. The first step is not just to learn to see India’s problems at face value, but to see how interconnected they are and to tackle them through collaboration and a systemic approach.

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