SMEs bullish on hiring apprentices in H1 2021 as ‘intent to hire’ jumps over 3X amid post-Covid recovery

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Updated: Mar 09, 2021 11:44 PM

Skill, Labour, Talent for MSMEs: SMEs’ in the manufacturing sector had the highest apprentice hiring outlook of 43 per cent followed by 38 per cent by SMEs in the services sector, and 27 per cent by SMEs in agriculture.

indian companies to hire more people in 2021 says surveyOnly 4 per cent of employers across sectors and cities had preference for apprentices in comparison to 78 per cent towards permanent jobs and 18 per cent for contractual employment.

Skill, Labour, Talent for MSMEs: Even as apprenticeship continues to remain the smallest funnel for hiring people vis-à-vis permanent and contractual employment types, the outlook or the sentiment to hire apprentices among small and medium enterprises (SMEs) has jumped 3.5X to 32 per cent for the current half-year period (January-June) from 9 per cent during July-December 2020 period. According to the latest survey of 600 companies including SMEs by TeamLease Skills University’s degree-linked apprenticeship programme Netap, 47 per cent SMEs had a positive intent to hire apprentices in H1 2021, up from 32 per cent in the preceding H2 2020 while 15 per cent SMEs anticipated decline in apprentice hiring in comparison to 23 per cent during July-December 2021. The outlook is referred to the difference between the proportion of employers indicating their increased intent to hire apprentices and those with a decreased hiring intent.

“Apprentice hiring has embarked on a very positive trajectory in the last couple of years as more employers are realizing the merit of the apprenticeship model to build a robust pipeline of employable talent. In fact, from 2018 to now, we have seen a 2.5 per cent y-o-y increase in employers who are willing to increase their apprentice intake. This positive momentum has happened despite the dip in the labor market during the Covid-19 lockdown,” said Sumit Kumar, Vice President – NETAP, TeamLease Skill University.

Also read: ECLGS: Banks now only 18% short of sanctioning targetted amount of loans; this many MSMEs benefitted

Segment-wise, small businesses saw the highest jump of 23 per cent in outlook from negative 15 per cent to 8 per cent during the said period. On the other hand, medium enterprises looking to hire more apprentices jumped 7 per cent from 30 per cent for July-December 2020 period to 37 per cent for January-June 2021. Moreover, with respect to various sectors, SMEs’ in the manufacturing sector had the highest apprentice hiring outlook of 43 per cent followed by 38 per cent by SMEs in the services sector, and 27 per cent by SMEs in agriculture. The most sought-after job profiles for businesses across sizes were fitter or welder (25 per cent), production engineer (31 per cent), automobile or mechanical technician (28 per cent), computer technician (29 per cent) etc.

However, employers overall preferred permanent employment over apprenticeship as only 4 per cent of employers across sectors and cities had their preference for apprentices in comparison to 78 per cent towards permanent jobs and 18 per cent for contractual employment. The major reasons discouraging employers from hiring apprentices were lack of awareness about the apprenticeship model and its associated policies and offerings (25 per cent) and no clear visibility of value addition to the organization through the apprenticeship program (20 per cent). However, the number of apprenticeship contracts crossed 3 lakhs in 2019-20 up by 50 per cent from 2018-19.

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