The atypical development of the Indian economy in the past few years has resulted in the job market getting biased towards ‘high-skilled’ jobs. In a span of 10 years, the economy witnessed agriculture’s contribution to GDP fall sharply, giving way to an unusual rise to the industry and service sectors. While the economy has progressed exponentially, giving way to new employment opportunities, the potential workforce has unfortunately not kept pace with the evolving skill requirements. The past decade witnessed a mad scamper for skilling in the IT/ITeS sector, as demonstrated by the innumerable number of professionals entering the workforce with technology certifications. Market experts, however, believe that the employment landscape in the coming years will change remarkably and the market will see a more balanced distribution of opportunities across all sectors and skill levels. While there is a large role of the government to introduce skilling as part of the academic fabric, an increasing number of organizations are hiring professional skilling providers.

NSDC’s skilling target stands at 150 million professionals by 2022. While enrolment into professional and vocational courses continues to demonstrate an upward trend, a large gap exists when it comes to skills that they develop and the ones that the industry requires. While India has taken some strides in skilling, especially in the erstwhile booming IT/ITeS sector, most of corporate India finds itself staring at the face of a large demand gap.

Santosh Mehrotra, Director General of the Planning Commission says, “The economy needs all kinds of work; people with technical diploma and above, people with vocational training in the age group of 15-18, and also people with general academic education. On the basis of these three categories, estimated for agriculture, manufacturing, non-manufacturing and services, the global number, which we have arrived at is 265 million till 2022 at the end of the 13th plan. (Over the next 10 years).”

There are two macro-economic developments that will demand attention to the industry of skilling across the coming years - the transition to a knowledge based economy and the large demand for professionals with vocational skills. The knowledge based sectors witnessing maximum growth across the coming few years include IT/ITeS, biotechnology, and pharmaceuticals, requiring aptitude in business communication, technology, and collaboration. Along with that, the demand for managerial and financial skills will continue to rise. The largest demand for specialized skills will come from four industries - infrastructure, BFSI, organized retail, and tourism/hospitality.

Is the workforce equipped to meet the demand?

There will be 200 million people in the employable age bracket of 18-60 years by 2030. More than 50 percent of the employable workforce in India is employed in agriculture, a sector that contributes less than 30 percent to the overall GDP of the country. Large differentials exist in the skills that the future workforce is acquiring and specialized skills that the industry requires. The difference is most pronounced in four sectors, real estate; transportation and logistics; tourism and hospitality; and textiles.

A 2012 industry analysis by KPMG and NSDC reveals that the existing system of skilling in India is hugely inadequate to build an employable workforce, as the largest segment of the supply comes from courses with limited industry linkage. In addition, the Indian academic system arguably lacks the outlook to prepare industry-ready skilled professionals.

Building skills of the future

There is an unusually high premium placed on pursuing higher education in India. In the same light, the perception towards vocational skills is low. The industry is not willing to pay for unskilled candidates, and from the supply side, candidates do not want to pay to get skilled. The Ministry of Labor & Employment and NSDC recognize that to tackle the broad issue of skilling, planned interventions are needed both from the government as well as the industry.

The government needs to make conscious efforts toward making vocational education a part of the academic curriculum. The role of public private partnership will become eminent as these partnerships will facilitate the plugging of the skill gap. Owing the limited market readiness in the education system, there is a great need for the prospective and existing workforce in India to be trained both on hard and soft skills. The need for skilling is pronounced at all levels - entry-level, mid-level and senior-level, and ranges from hard technical skill development to soft management and communication skill development. There is a significant need for development of business acumen, as we integrate more with other global economies and adopt progressive operational practices from large global conglomerates. There is also a pressing need for market-linked vocational skill development that will allow professionals to decrease the traditional reliance on educational degrees and shift focus toward employability.

The decision to hire a skilling provider involves looking at multiple aspects of the immediate and long term business objectives and aligning them with the talent strategy.Identifying how a partnership will enable an organizationto meet its desired goals involves objective analysis of the skilling providers’ service description and credibility.