The peculiar conundrum that dogs the Indian economy is the shortage of skilled workforce in the country despite the hue and cry over demographic dividend and the large number of unemployed people. This implies that there is a problem of “scarcity among plenty”. If companies are to survive in this competitive environment wherein job hopping and talent poaching have become a norm, then these individual companies will have to keep tweaking their business models to be able to afford their share of the best, scarce talent.
How do we as a nation get out of this conundrum? One of the suggestions is the labyrinthine and obsolete web of labor regulations need to be simplified. Received wisdom today correctly identifies better matching, improved skills, financing for training and ultimately universal primary education as underlying drivers of an improved labor market. As a sign of improvement, the National Skill Development Corporation (NSDC) has materially increased its pace in handing out loans (though not equity). Slowly but surely some things are happening across labor market verticals.
As the problems ailing certain verticals make news on a daily basis, it is time to focus some attention on the cholesterol choking an improved market within each market vertical. India will need to make big and small changes to make its labor supply chain smoother than it is. That is the only way to make the demographic dividend a reality.