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Right-focusing the skill policy in india

Battle of the Bulge The urgency of focusing the skill policy is that it needs to be realized and implemented before the demographic dividend turns into a youth bulge. Shweta Sharma and Navneet Sharma


mongst the sources of competitiveness, skills have now assumed primary importance. The primacy of skills is embedded in a call for policy shift to achieve not just economic growth but attain socio-economic objectives through economic growth. Skill creation can be divided into four levels: minimally educated, vocationally skilled, college educated and highly skilled. It is important to recognize that, (a) all the four levels have different levels of populations in each strata and contributions to the economy, and (b) all the four together create a skillecosystem, which supports development and growth of a sector. |42| India-China Chronicle  July 2012

The magnitude of the challenge can be gauged from the fact that India will need to have 500 million skilled persons by 2020 and the total number will comprise of the following components of the skill pyramid: level one – 50 percent (minimally educated); level two – 25 percent (vocationally skilled); level three – 20 percent (college educated) and level four – 5 percent (highly skilled) [As per a report by IMaCS]. During the last five years, there has been sufficient debate and action on the need for skill building, however, its future direction requires some finetuning. A major policy response to address skill issues has been the creation of a three-tier institutional structure consisting of the Prime Minister’s National Council on Skill Develop-

ment, National Skill Development Coordination Board (NCDCB) and National Skill Development Corporation (NSDC) in 2008. The Prime Minister’s council has set a target to create 500 million skilled people by 2022 through skill systems. NSDC has already partnered with a large number of sectoral skill councils to encourage skill development on PPP basis. The policy response so far has attended the level 2 to a good extent, but there remain two principal aspects, which require urgent and careful consideration in order to achieve the overall policy objectives. Let us first highlight, through some statistics, an indicative status of jobreadiness of college graduates (level 3). As per Knowledge Commission of India & Nasscom, only 10% of graduates are employable. Similar survey indicates that about 20 to 23 percent engineering graduates and MBAs are fit for jobs as per the present education

system. Another report by Nasscom and McKinsey predicts that India will confront a huge shortage of skilled workers in the next decade, particularly in the BPO industry. According to the Nasscom-McKinsey report, only 25 percent of our engineering graduates, 15 percent of our finance and accounting professionals and 10 percent of professionals with any kind of degrees, in India, are suitable for working in multinational companies. A recent study conducted by the Confederation of Indian Industry (CII) has revealed that human resource is the biggest challenge faced by India especially at the managerial, production and marketing levels due to the widening demand-supply gap. Corporate India is creating around 10 lakh new jobs each year. If that is the demand over the next few years for job-ready graduates, one can imagine the humungous demand at middle and lower levels. In the current policy priorities, including the proposed approach in the 12th Five Year Plan, while levels 1 (minimally educated), 2 (vocational) and 4 (highly skilled) are receiving the required attention but level 3 remains hugely neglected. Importantly, level 3, which include graduates and post-graduates across all professional/ academic disciplines, are adequately

regulated by 17 regulatory authorities. However, the regulation has not yielded evenly high standards across the country, which is aptly reflected by various reports in terms of lack of employability of graduates as mentioned above. In view of the macro-economic challenges, presence of islands of excellence along with poorly performing institutions suggests that the policy challenge is to generally improve the standards of skill creation in 634 universities and 33,023 colleges of India (as per the latest statistics released by UGC: “Higher Education in India at a Glance, 2012”). It is worth clarifying that the case here is about striking a balance in the policy focus, and not neglecting the current policy focus on the minimally educated, vocational skills and highly skilled. Attention to all the four levels of skill chain is akin to coordination in an orchestra to create symphony. The second leg of the policy priorities relates with how to create skills at the third level of the skill pyramid. The Government of India has increased the number of institutions of national importance such as the IITs, IIMs, etc, which are perceived as islands of excellence, as a policy response. While increasing the number of IITs and IIMs is a welcome step, considering it a suffi-

cient step is grossly misplaced. In order to improve the general skill creation standards at college/ university level, a major initiative is needed in terms of (a) defining the target skills and embedding them in the curricula of a course, and (b) equipping the teachers in 634 universities and the 33,023 colleges to deliver the target skills. Primary research by the authors has revealed that most tertiary educational institutions have no express idea of the skills to be generated in a university level course, which corroborates with the above findings where one sees MBAs without the required management skills and engineers without the desired technical skills. Graduates are being produced with standard academic curricula with little or no regard to the skills desired by a market. This situation results in an additional burden either on the individual or the employer to become job-ready. Once the target skills are articulated, a policy initiative is needed to enable university/ college teachers to achieve the target of creating skills, which are demanded by a market. Here arises the question of training teachers in skill creation methodologies and pedagogies. In this context, the institutions of national importance such as the IITs and IIMs have a greater role to play as “catalysts” – i.e. producing good teachers who can create skills in their respective institutions. Graduates produced by institutions of national importance are nowhere close to the required numbers. Therefore, asking them to be catalysts will deliver much better outcomes than merely allowing them to produce a few hundred graduates each year. The urgency of rightfocusing the skill policy is that it needs to be realized and implemented before the demographic dividend turns into a youth bulge. 

Dr Shweta Sharma is UGC Post-doctoral Fellow. Dr Navneet Sharma is a policy researcher. Views are personal. Comments are welcome at:

July 2012  India-China Chronicle |43|

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