Modelled like a digital marketplace, the skill exchange would bring businesses which need to hire skilled resources and training providers who skill “these” resources on one platform
One of India’s supreme challenges today is the availability of skilled resources to run businesses. Ironically, India is said to have the highest youth population in the world. According to the latest population figures, one in every five young people in the world is an Indian. However, most Indian youth are unskilled and hence not employable. Additionally, businesses routinely indicate lack of skilled resources at the right place and on time. Jobs available and available skilled resources are also geographically dispersed.
The good thing is that with a lot of governmental support and policy directives, skill development initiatives have started to generate results across the country. There is budgetary support available as well, and now any youth who successfully undergoes a skill course can get financially rewarded. This has started to create a supply chain of skilled resources for businesses to tap in.
But has this successfully bridged the gap between the need of the businesses and availability of resources?
Sadly, no. While it has addressed the problem to a large extent and the results are very encouraging, the part of the problem is the asymmetric information that exists between businesses which need resources and vocational training providers who develop skills to service these needs.
While there are multiple reasons for this mismatch, one of the key reasons is the lack of a common platform for all stakeholders to be available and engaged.
So, what really is the issue?
One of the key issues is the lack of information-sharing on job opportunities, trade specialisations, location of opening, number of skilled resources required, salary bands, timeframes, etc, for other stakeholders to work upon.
For example, businesses need people but have difficulty doing a forward projection of skilled resources required. Even if they do, it is often vague and necessarily does not indicate the need of trades with clarity. This asymmetric information sets off a chain reaction with other stakeholders like training providers, students and government bodies and makes them unable to participate constructively.
Given that job openings are not known upfront, training providers end up arbitrarily selecting students for skill trainings. In turn, students without any visibility of jobs at the end of the training end up enrolling for any course that they come by. The government ends up sponsoring benefits without linking the students to actual available jobs.
This leads to other challenges like:
1. Students get skilled and wait for job opportunities. This often takes time, and by the time the interview takes place, students either have forgotten most of what they have learnt or have lost interest.
2. Every delay in placing skilled resources leads to low strike rate of conversion. So, you train X number of students and only a small percentage gets recruited. The rest drop out.
3. The candidates who drop out often are skilled and certified but still remain unemployed. These add to the basket of unskilled, uncertified resources.
4. There is a cost of benching skilled resources. Students who undergo skill courses, clear certification and stay on bench till placements lose interest and seek whatever job opportunities which come by.
5. Students who undergo such skill training usually do not have digital footprints. Every delay makes it more difficult for the training provider to reach out to them and notify them for any openings. Sometimes students frequently change mobile numbers and it becomes difficult to reach them.
In addition to the above points, vocational training providers also go through a lot of stress planning to build capacity to address this need.
Since there is a lack of projection which is accurate, there is a mad rush to select students, and of sourcing them across the country.
Most such acquisition is unscientific and is just done without the real need clearly visible. As a result, students get enrolled in a skill course without any genuine desire to seek the job which probably exists at the end of the training. The only reason they mostly enrol is for the cash reward incentive, which they can get at the end of the training programme. This leads to skilling students on programmes which they have no intention to work for.
What could be the remedial measures?
A skill exchange as a platform to collaborate would address this issue. Modelled like a digital marketplace, the skill exchange would bring businesses which need to hire skilled resources and the training providers who skill “these” resources on one platform. Built as a transparent system, businesses could list where the next jobs could be, how many in numbers, which location and exactly when are they coming up. With this information available, students who have undergone a skilled training and are certificated by the sector skill council could indicate their level of competency, interest, geographical preferences, etc, and proactively seek out a job. What this does is that every skilled resource now has visibility of jobs available, in addition to other key metrics like location, salary, etc. Additionally, businesses which want to hire these skilled resources know where they exist and can accordingly calibrate their hiring plans.
There would be other benefits as well. Migration due to lack of job opportunities could be avoided. Localised job creation could be incentivised. Jobs available could be transparently known. Training providers could reduce cost of student acquisition and seek registered students to enrol for a programme, thereby eliminating middlemen and agents who charge for bringing in students to the training provider. The platform will also build transparency and keep a trail of skilled resources who were placed through it. And unlike a job portal, the skill exchange would match jobs to skilled resources not on the basis of mere education qualification or experience, but on true competencies on select trades, thereby encouraging skills as a key selection criteria and not pedigreed colleges or degrees.
The building of this skill exchange platform could allow training providers to scale up training infrastructure, hire competent faculties, and deliver quality training on the basis of available jobs. As always, the benchmark of quality training is not the number of hours of training done, or fancy infrastructure where it was done, it’s the employability factor.
This linkage also allows the government to reward and incentivise everyone in the ecosystem based on real market needs.
As India progresses towards the millennium goals, getting our youth skilled would be the biggest service we can do to the nation. This, along with inclusive growth and empowerment, is just what India needs to become the best in the world.
Written By: Ambarish Datta. The author is the MD & CEO of the BSE Institute Ltd, and founder director of BFSI Sector Skill Council of India, National Skill Development Corporation (NSDC)