Economic growth of any country depends on two key factors—the size of its population and the skills of the population. A large population ensures substantial demand for products and services, and it also provides ample workforce to produce these. India is fortunate to have a large and predominantly young population. However, much of it lacks the skills to be adequately productive in a modern economy.
Historically, India has not accorded due importance and respect to skills and now its economic growth is constrained by acute skill shortage. The country cannot wait for a skills culture to evolve and it must quickly promote a skills revolution to make up for the deficit.
The scale of the challenge is daunting. According to a report by the Institute of Applied Manpower Research in 2013, only 10% of the labour force had vocational training and less than 3% had received technical training. Only 17% of the country’s 431 million labour force, as estimated by NSSO in 2009-10, had education of higher secondary and above.
The inadequacy of India’s formal training system is highlighted by the fact that less than half of the workforce has had any kind of formal training. Make-in-India faces serious skill issues as only 16% people with technical qualifications worked in the manufacturing sector; the services sector absorbed over 60% of the technically trained workforce.
The challenge is not only of the scale of training. The employers have contested the employability of even those with high qualifications. The promotion of knowledge over skills renders the qualified people unprepared for jobs in the industry. The gap between employer requirements and certified capabilities results in low productivity and competitiveness.
Therefore, it is imperative to improve the employability and value addition of the workforce by enhancing occupational training with training in management and entrepreneurial skills. It is also important to harmonise our skill standards with international standards to allow global competitiveness and mobility of Indian workers.
To meet these critical needs, the All India Management Association (AIMA) has promoted the Management, Entrepreneurship and Professional Skills Council (MEPSC) with the support of the National Skills Development Corporation. MEPSC’s mandate is not only to train the workforce but also to establish world-class standards for skills, training, assessment and certification. AIMA has signed an MoU with NOCN—a leading skills organisation in the UK—to develop national occupation standards in diverse skills, training courses and assessment benchmarks in essential management skills that are applicable across industries. These standards will be same as those applied in the UK. The certification of management and entrepreneurial skills by MEPSC will be valid in Europe also.
Global acceptance of Indian workers is becoming important because of the increasing oversupply of labour in India and declining labour supply in developed countries. Ensuring global mobility for trained Indian workers has to be a major priority of skill development programmes. It will also encourage foreign investment in India, as it would give investors a world-class and globally-transferable workforce in India itself.
Setting globally-acceptable occupation standards and world-class training and assessment practices is critical to encourage the employees to invest time and money in getting training and certification. The skill development mission will not succeed if potential trainees do not see high returns on their investment.
Entrepreneurship training has to be a key component of our skill development programmes. A large number of Indians are self-employed for a variety of reasons and their productivity is crucial to national productivity and job-creation. It is important to equip employed workers with skills to set-up and manage their own enterprises. Such training is needed for initiating a start-up revolution especially among less-qualified Indians.
Recognising the skills of those already employed and upgrading their skills through retraining is also needed. Given the fact that the bulk of Indian workforce is self-taught or informally trained, their skills have to be certified for better labour market information and improve their career prospects. Skilling the workforce is a top national priority and AIMA, we believe, is contributing to enhancing the workforce’s capabilities and productivity.
The author is DG, All India Management Association