Services export led the overall export growth, setting a new record at the value of $322.72 billion with a growth rate of 26.79 percent during FY 2022-23. Skill-oriented services exports from India propelled optimism and in this current scenario, the skilling initiatives are also in the spotlight. Skill development of the new generation is a national need and every youth to be empowered with the skill to achieve a successful career. Skilling India’s youth should undoubtedly be a high priority, but government initiatives to improve India’s skilling track record have not been very satisfactory yet. Under the National Policy of Skill Development and Entrepreneurship 2015, the target was to impart various types of skills to 40 crore people by 2022. However, around 4 crore people have been trained so far.
In 2020, Indian companies identified skill gaps as their greatest barrier, representing 34 percent of the challenges they experienced. In 2022, this has risen to 60 percent. For instance, the Indian IT industry now sees the lack of talent as the most significant barrier (65 percent) to adopting a spectrum of emerging technologies at a time when the demand for the latter is expected to grow twenty-fold by 2024.
Notwithstanding all efforts aimed at skilling, re-skilling, and up-skilling, the shortage of manpower with employable skills remains a serious challenge even now. It is also a huge opportunity for varied stakeholders to come forward and empower our unorganised workforce with employable skills. There is a need to align the entire skilling ecosystem with the demands of job providers.
A mismatch between the needs of job providers and the skills of job seekers proves a critical hindrance in carrying out service pursuits in particular and any other industrial activities in general. There is a huge gap today between the demand for a skilled workforce and their availability in the market. The entire unorganised sector is dependent on semi-skilled or unskilled workers. A minuscule percentage of them are fully skilled and they are always in demand and are well paid as well. Over 150 million young people in developing countries are skilled but unemployed. As per the assessment of the Centre for Monitoring the Indian Economy reported in December 2022, youth unemployment rates are two to four times higher than adults. Around 33 percent of trained youth are unemployed as their employability quotient is very poor.
There are multiple repercussions of not having a skilled workforce in adequate quantity to meet the market needs. Even they need proper training and handholding to deliver services to match global standards. Thus, the lack of required skills among job seekers is a double whammy for employers. They do not get value for the investments they make nor does the workforce available in the market have prospects of growth.
While some skilling schemes have since been restructured, the problem has not been fully addressed. For instance, when the government introduced the Garib Kalyan Rozgar Yojana (GKRY) in 2020 to address skilling and unemployment issues that emerged in the wake of reverse migration, it did not pan out as anticipated. Many reports suggest that GKRY’s market demand-driven skilling initiatives were not successful; they did not reach the intended beneficiaries. This hints at a systemic problem that affects the talent ecosystem in India.
Think about a girl belonging to a rural backward area, contemplating her next career move. How should she go about finding her calling? Where should she get trained? And what kind of jobs would be open to her? Stories of many youths in India today mirror that of rural girls. While they have a strong drive to better their lives, they are limited by a lack of access.
A major challenge that currently faces concerning its talent pool is one of ‘matching’ — between job seekers and jobs, and between skill-seekers and skill-training providers. Search costs are prohibitive for employers and a candidate’s qualifications are difficult to verify. For jobseekers, there seem to be many available jobs but listings are spread across different platforms and there is no real way to establish the quality of job roles.
Similar issues plague the arena of skilling; candidates looking to upskill find it difficult to connect with credible skill providers, and ‘certified’ trainees often do not have the required skills to make them employable. Data from India’s biggest skilling program, PMKVY, testifies to this fact. Over the last few years, only one in four persons who trained under PMKVY were placed.
Digital Ecosystem, a Bird’s Eye View of India’s Skill Talent
Technology can potentially bridge these gaps that we observe in the workforce market. Already, several employers conduct recruitment through digital platforms, and there has been a significant ramping up of State-level employment initiatives such as job portals. To extend support to blue and grey-collar workers, the Central government has also announced a beta version of the Unnati platform, a “platform of platforms” to facilitate interoperability and bring together the entire ecosystem, in the form of a national open digital ecosystem — a Talent NODE.
Youth from rural backgrounds can benefit greatly from such a Talent NODE. In one place, they can find information on accredited skilling programmes including placement records, as well as details about employment opportunities. Private players can seek insights from this platform to create value-added services such as counselling, aptitude testing, and credit transfers between training institutes. As more initiatives get integrated into this platform, it can host a wealth of information, offering a bird’s eye view of India’s talent.
India’s informal sector accounts for approximately 93 percent of the employed population. In the case of Talent NODE, this population could face a high risk of exclusion. Mitigating the exclusion risk would require engagement with marginalized groups, via both online and offline channels. Common Service Centres (CSCs), for example, could be used to facilitate last-mile reach. Similarly, user-friendly, vernacular interfaces could greatly benefit job and skill seekers across segments.
The Talent NODE is by no means a silver bullet. But if done right, through an innovative and inclusive approach, between 50-80 million people can be expected to benefit from new jobs or jobs that are better matched to their skills. A million different opportunities for a million aspirations through one interconnected ecosystem.
The writer is a co-founder and MD of Orane International, a Training Partner with the National Skill Development Corporation (NSDC), and a Network Member of India International Skill Centres, an initiative of GoI. Views expressed are personal.
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