India is in a unique position in the world - our demographic dividend is much talked about with predictions that we will surpass China as the world’s most populous country by 2025 and have a large proportion of those in the working age category. It is estimated that by 2022, India will need 700 million new skilled workers to meet our economic growth needs. This fantastic demographic dividend needs to be harnessed by creating jobs and meeting people aspirations.
For the country to be able to optimise its demographic advantage, the two pivotal points where interventions are needed, are education and skilling. The government of course recognises this which is reflected in initiatives such as the Right to Education and Skill India, designed to bring about large-scale systemic change by deepening education and having a better skilled workforce, respectively.
On the education initiative, we seem to have done reasonably well in terms of access to education. Recent data indicates that about 230 million children have enrolled in the school system between Standard 1 and 10 in 2014. But the drop-out rate before completing Standard 10 is at an alarming 47 per cent. Assuming that the minimum education level required to enter the workforce today is Standard 10, it is indeed worrying to note that more than half our children are not reaching that qualifying milestone. On the other hand, it is estimated that 12 million youth enter the workforce every year, whereas there are only about 7.5-8 million jobs awaiting them. For those who have not attained higher levels of education, the available jobs are at the entry level, and are usually plagued by high attrition and stagnant salaries. Rapid economic and technological progress coupled with education systems that have been unable to keep pace and shifting demographics have led to significant discrepancies between the supply of skills and the needs of the market.
While the government’s efforts -- supplemented by corporate CSR and NGOs on both access to education and focus on skill development -- are laudable and should continue to grow and evolve, we need to also recognise that by itself education alone is not adequate to generate a productive work force. Similarly, providing skill training as an afterthought will create only a limited talent pipeline for India. Education and skilling need to be integrated to maximise and sustain the advantage of labour on India’s economy.
There is no simple solution to make our children future-ready and active participants in the country’s economic growth. However, the three things that we can immediately look at are, helping children recognize their skills; fostering an environment in which youth who are just entering the workforce can have better career paths; and, improving options for those youth who are already working.
We often hear that young people refuse to take jobs that aren’t aspirational. For example, a boy living in a Mumbai slum who has completed Standard 12 would rather sit at home than become an a/c technician. He doesn’t know whether he has the skills to work in a call centre or that he could potentially make far more money as a mason, but to him it is aspirational to have a desk job and sit at a computer in an air conditioned office. In fact, a recent study estimates that only 33 per cent of individuals of working age are employable. This gap between aspirations and skills exists not only because of the lack of dignity of labour in our society, but also because children and youth do not know what skills they possess. An interesting initiative to address the latter is being undertaken by an NGO called “Lend A Hand India” that has introduced the basics of multi-skilling to children in secondary school. Using curriculum that is recognized as part of National Skills Qualification Framework by NSDC, this program exposes children to a wide variety of potential occupations, such as sales, retail, carpentry and electrical work and the skills needed for each of these. To further add value, the children who complete the programme are awarded certificates by the respective Sector Skill Councils. This simple, very basic, early exposure gives these children a head start in the world of work. There are also examples of other NGOs who are focused on complementing undergrad education with basic skill training in diverse fields.
Along with education, what we need is skilling that will help the youth jump the low-paying entry level jobs into mid-level jobs which are not only more remunerative but also offer better career paths. For youth who have not completed Std 12, the available jobs are at entry level and there are several organisations providing them training to secure these jobs. However, not many are upping the ante – by identifying the mid-level jobs and then finding ways to train youth with lesser educational qualifications to get into those jobs. Can we develop advanced skilling programs that will adequately skill young boys and girls who have passed Standard 12 to make them eligible and preferred for the mid-level jobs that would ordinarily be available only to a graduate? And what about the large numbers that don’t even make it to Standard 10, those who have already dropped out in Standard 5 or 8 or maybe never even been to school? More often than not, they find themselves in jobs that are a means for survival and have absolutely no correlation to their skills or aspirations. For youth such as these, we need part time programmes that, in a short period of time, provide them additional skills, help them realise their potential and improve their employability opportunities, without needing them to take time off from their existing jobs. In addition to supporting systemic change, we at J.P. Morgan are always proactively seeking innovative ideas that overcome the traditional barriers of education and give better opportunities to young adults who, for socio-economic reasons, may not have been able to study further.
Given the size of the challenge in India, the private sector has a role to play by working closely with the government and leveraging technology such as smart classrooms and online platforms to ensure scale, deeper outreach and viable costs of both education and skilling programmes. We have our education systems in place and we have our skilling programmes in full force. For India to discover the potential of its demographic dividend, what we now need, is to create bridges that connect these two parallel streams.
