India could be the world’s third-largest economy and poised to become its fastest-growing soon, but the Economic Survey 2014-15 says that the country has a smaller number of skilled people than most developing nations. In fact, given how hyped India’s demographic dividend has become, this surely would be one of the most pressing challenges the country faces. As per the Labour Bureau Report 2014, only 2% of the Indian workforce can be considered skilled; only 6.8% of the population aged 15 years had received or were receiving any kind of skills training.
The current levels not only affect the employability and, thus, the income levels of a large chunk of the population, but also could have already hindered the country’s growth potential—as per the Economic Survey, India needed nearly 120 million skilled people in the non-farm sector in FY14, and given the skilled workforce numbers, it could very well be that a large part of this demand was either not met, or inadequately met.
But why does India have such a dismal showing? This has perhaps a lot to do with the fact that neither school nor higher education in India focus much on skilling. The handful of institutes that are there have very little or no links with industry (which is where the jobs are) and therefore there is a gap between the efforts of these institutes and the requirements of industry. However, the outlook on skilling has improved in the last few months, with states like Rajasthan reforming laws governing industry apprenticeship that could boost industry’s uptake of youth for skilling. Unless meaningful links between industry and the skilling efforts of the government are established, not much is going to change on the ground, though.