Despite some sectors engaging more and more apprentices – auto, electronics and ITeS engaged 438,500 apprentices in FY24 – the participation rate of apprentices in the Indian labour force is just 0.1% (in developed economies, it’s 3-4%). Ramesh Alluri Reddy, CEO, TeamLease Degree Apprenticeship, told FE’s Vikram Chaudhary that for India to become a developed country, as many as 20 million apprentices are needed, to start with. Excerpts:

How do you foresee the landscape of degree apprenticeships evolving in India?

As per the World Economic Forum, of the 13 million people who join India’s workforce each year, only one in four management professionals, one in five engineers, and one in 10 graduates is employable. Our education system is skewed towards qualifications, rather than skills.

This is reflected in low employability of our youth (India has 10% unemployment rate among people aged 15-29). Rural male unemployment is 8.3%, and female unemployment is 7.4%. Urban male unemployment is 13.8%, and female unemployment is at a precarious 21.7%.

The situation of students who have completed various levels of education is not rosy, either. Graduates (13.4%) have the highest level of unemployment, followed by diploma/certificate courses (12.2%), postgraduates and above (12.1%), and secondary and above (7.3%).

Apprenticeships – incorporating on-the-job training into academic degree programmes or vocational studies – can assist reconstruct the education, skills, and employment continuum. A step further is degree apprenticeship – an integration of apprenticeship with higher education (blend of on-the-job and theoretical higher learning). Degree apprenticeship is in line with the UGC guidelines as per the NEP, but the execution is based on both Apprentices Act and UGC Act. Since it is executed in collaboration between industry and academia, the curriculum is in line with industry job roles.

We expect the government to now initiate reforms and incentivise engagement to fully utilise our demographic dividend. This would include shift from bilateral to tripartite agreement (bringing in academia as the third party, aligning education directly with industry), tenure longevity (apprenticeship duration that matches the traditional academic timeline – extending to a structured 7-year, 2+3+2 journey), modularity in credit framework (seamless horizontal and vertical mobility between different education streams) and infrastructural improvements (mix of online, on-site, on-campus, and on-the-job training, as well as single apprenticeship portal). We foresee this to become the new way of learning and mobilising entry-level talent.

What role do degree apprenticeships play in bridging the gap between academic education and industry requirements?

Apprenticeships and work-based learning programmes help plug the demand-supply gap of skills. Our educational pedagogy cannot be made responsive to real-time technological changes, and it will take time for the curriculum to adapt to generative AI, ML, deep data science, robotics and the Internet of things. The recent Nasscom-BCG report stated there’s more than 15% growth in AI/ML jobs over the past 12 months, with positions like AI engineers rising at a whopping 67%. This will result in talent deficit in some industries who will not have the resources to hire these resources. The best pathway is to get people with the right foundational concepts to undergo on-the-job training, exposing them to actual working conditions, latest technology and industry-specific best practices. This immersive learning experience not only enriches their theoretical knowledge but also hones their practical skills, making them valuable assets for future employers.

What is the demand for apprenticeships in India?

It has been growing at 35-40% annually. Automotive, electronics and ITeS are the biggest employers of apprentices, with 258,000, 91,900 and 88,600 apprentices engaged, respectively, in FY24. They also exhibited the biggest growth in apprenticeship engagement over a 4-year horizon, with 11.7x, 12.2x and 12.5x growth witnessed since FY20. The attractiveness of apprenticeships is evident in the premium stipends being offered, with some stipends exceeding Rs 50,000 per month, far more than salaries being paid to fresh graduate employees. The National Apprenticeship Training Scheme (NATS) is proving to be an attractive pathway to scale white-collar apprenticeships as it offers graduate, diploma students and vocational certificate holders a practical, hands-on, on-the-job training-based skilling opportunities. Apprenticeships have also emerged as a powerful vehicle for driving diversity in the workforce, particularly for women. There has been a significant increase in the number of women apprentices over the last six years, rising from 7,228 in FY19 to an impressive 193,630 in FY24.

But despite this growth, the current participation rate of apprentices in the Indian labour force is low, accounting for only 0.1%. This figure starkly contrasts developed economies, where participation is 3-4%. As India aims to become a developed nation, there’s a need for a comparable level of engagement, which is estimated to translate to 20 million apprentices.

How is TeamLease Degree Apprenticeship contributing to facilitating degree apprenticeships?

We have been working closely with industry, government, sector skill councils, academia, and the youth. We have placed 700,000 apprentices across sectors in the last 10 years, achieving a transition rate of 98% into formal employment, with nearly 40% absorbed by the same organisation.

Additionally, our Work Integrated Learning Programs (WILPs) – and NAPS (National Apprenticeship Promotion Scheme) and NATS apprenticeship programme administration – emphasise real-world skills and job readiness, ensuring that our youth is equipped with the competencies needed to thrive in today’s dynamic workforce.

We have extensive sourcing channels, including 22 universities and 300-plus colleges, 150 field recruiters, three in-house and external portals, multiple government agencies including sector skill councils and regional boards of apprenticeship training, and over a thousand skills training centres and skilling partners.