· Indians spend $600 billion, yearly on education. With $600 billion yearly overall education spend at comparable prices; India’s education sector is bigger than that of the US. India is the 9th highest in the world. India’s yearly growth in overall education spend, at 15%, is also one of the fastest in the world.
“India will account for 20 per cent of the world’s global workforce in 2020s. The average age of Indian workforce will be 29 years as compared to 37 for the US and China and 45 years for Europe”, Kapil Sibal, minister for human resource development, communications and IT said at the India Economic Summit 2011 in Mumbai.
The estimated CAGR of private revenue in Indian education, at 19% during ’11-’15, is also one of the fastest in the world. Skill and vocational training are emerging as big opportunities for private players. High growth, scarcity of investable opportunities and the recession-proof nature of the sector are likely to keep valuations high.
From $30 billion in 2012, private education revenue is set to reach $45 billion by 2015. K-12 ($20 billion), technical education ($12billion), coaching ($8 billion) and pre-school ($3 billion)
Urban affluent spend 10.4% of the total consumer spend towards private education. The rural poorest spends just 1.4% of wallet on education. With the median income elasticity of demand for education at near 2, a 1% rise in per capita income leads to a 2% jump in education spend, mostly on private education. This is the key driver of the sector.
Never before in the history of any country has human capital development been such a key focus area as 2011 was for India, marking the beginning of better times.
The huge demographic dividend India can for sure reap from its large young population, with 250 mn to 400mn people joining the employment market between now and 2025 to fuel its growth. This is a staggering number by any standards. However, to become productive these huge numbers have to be suitably trained to avoid large scale unemployment, which needs greater emphasis than rejoicing the fact that we have the largest youngest population in comparison to other countries.
To be more specific, 109 million persons will attain working age during the period of 2007-2012. The net addition to workforce is, therefore, expected to grow to 89 million of which around 13 million are likely to be graduates/post graduates and about 57 million are likely to be school drop outs or illiterates. A significant share of incremental demand is likely to be for skilled labour - graduates and vocationally trained people are expected to account for 23% of incremental demand by 2012. The study further estimates that India is likely to increase deficit of 5.25 million employable graduates and vocationally trained workforce by 2012.
Vocational education could be a great way to counter this challenge guised opportunity. India’s current capacity for vocational training is just about 4 to 5 mn per anum against a requirement of 10 times that. Hence focusing on vocational education is of primary importance. The National Mission on Skill Development, under the Chairmanship of Prime Minister of India, had set a target of preparing 500 million skilled persons by 2022. On the other hand, it is expected out of approximately 75 to 80 million jobs created in India over the next 5 years, 75 per cent will require vocational training to enhance the employability prospects.
But, there is a huge ‘skill gap’ both in terms of quality and quantity - At present, only 2 per cent of the work force in the age group 15-29 has undergone formal vocational training and eight per cent have had non-formal vocational training.
In 2006, a World Bank report on skill development and vocational training in India spelt it out for all - "The relative supply of workers with technical/vocational skills has declined. This may be due to the fact that workers with technical/vocational qualifications do not have the skills that meet the labour market needs - often because of the poor quality of training provided."
Why is it so? How can we change this scenario?
Vocational education is still considered as the poor cousin of university education, by the urban middle class in this country. This is largely because it is directly linked to the perceived low-status manual work. As it exists today, vocational education perpetuates the iniquitous social hierarchy in the country. We need a system that treats vocational subjects as an honourable option and offers them as a serious alternative for students, regardless of their class, caste, region or any other marker of socio-economic status.
The major challenges or questions we need to answer are:
1. How do we begin imparting vocational skills to a staggering millions quoted above? (Most of these youngsters are in the age group of 15 to 25 years belonging to lower middle class, could be school dropouts or even a graduates who is in search of a way to support a living .)
2. Where can we find suitable instructors? There is serious shortage of skilled teachers, finding the welders, machinists, carpenters, electricians, beauticians, gardeners, English language trainers, computer skills instructors and multiple others to handle good vocational skill instruction is a task that boggles the minds of the policy makers.
3. How will we create jobs at places where these students reside?
4. If they are provided jobs at place far off from their homes (From villages / towns to cities) how will they relocate with the current salaries and facilities provided?
5. How these youngsters sustain with meager salaries they are offered? (The salaries range from Rs.4,500 to Rs.6,000…. How can an individual support himself and his family with this kind of an earning)
6. The employers are skeptical of employing these youngsters due to reasons such as
a. Lack of experience (Employers prefer experienced staff over youngsters who have just completed the course of a short duration)
b. Salary constraints (Employers over salaries which are way below employment seekers expectations)
c. Facilities (Employment seekers expect facilities such as stay and food which may not be provided by the employees
What is the most important factor which rule the decision of a CAREER ASPIRANT whether or not take up Vocational Training and specifically paid Training?
Here the career aspirant is the consumer and going to the consumer point of view, a young man / woman’s desire to pay and enroll into a Vocational Training Course is solely dependent on the difference he / she sees between the compensation potential before and after being trained.
The major questions which arise are:
1. Do organizations see any value difference between untrained vs trained while choosing candidates for employment?
2. If yes how do we quantify the value difference?
3. What would be the compensation premium they would be willing to pay for this trained vs untrained employee?
The major factors to be considered are:
1. Demand for Trained employees.
2. Quality of Training / Skilling provided.
3. Industry-Academia association /partnerships
4. Location of the training organization and probable employers
The major aspects to be taken care of are:
1. Identifying skill requirements and course offerings exactly matching the needs
2. Training the trainers to match the industry standards and constant faculty training and assessment to maintain quality of training
3. Internship / On the job training
4. Placement partnerships
5. Striking a balance between affordability of the course and profitability of the venture
6. Tie ups with bankers to fund the course fee /student loans
It would be preferable if:
1. The design of the vocational system will not compel students to choose too early between the vocational and academic paths.
2. Vocational education system must offer students the possibilities of switching between the vocational and the academic paths if they wish to do so. Offering this flexibility is a definite route to reducing the social burden of any choice, i.e. making all educational choices “honourable”.
3. In order to ensure flexibility it would be good to have a vocational education method that is integrated with the basic education system on one end, and with higher education system on the other. An integrated system will erase sharp distinctions between “vocational” and “academic” streams, thereby increasing the probabilities of youngsters to opt for Vocational education who are inclined towards higher education.
4. A flexible, localized vocational education system, built integrated with effective basic education will easily be accepted and embraced by the rural and semi-urban societies.
Let us declare 2012 as year of 'Proud to be Skilled Indian' says Vijay Thadani CEO of NIIT Limited and Chairman of CII's Northern Region.
“We should also look at launching events such as 'Indian Skills Idol' and have popular brand ambassadors to endorse pride in skills. Then we will not be apologetic about our 1.2 billion population. We can be an enviable reservoir of 1.2 billion skilled people.”
Skills development in India got an impetus when Prime Minister Manmohan Singh constituted the National Council on Skills Development in 2008 and the National Skills Development Corporation (NSDC) thereafter. For NSDC, this year has been one of the best -- a-one-of-its-kind public-private partnerships formed to contribute significantly to the charter of skilling Indians.
NSDC forged many new partnerships to train people, including joint ventures with the Bharti Group for 11.5 million, with Everonn for 15 million, with Future Group for seven million and with NIIT for another seven million. As of its last month's report, they have approved 34 training projects and eight sector skills councils, covered 177 districts, set up 2,427 centres, touched 20 sectors and have already set up the foundation required to train 58.6 million people in 10 years.
In addition, under a special scheme, industry showed interest in joining hands with NSDC to induct youth from Jammu and Kashmir to train them in special skills at their facilities across India. Appointment of an industry veteran, former Tata Consultancy chief executive S. Ramadorai as an advisor to the prime minister in NSDC with the rank of a cabinet minister, is yet positive move this year.
Private participation extended beyond NSDC and many companies came forward. Fiat India Automobiles launched "Diksha" to provide educational avenues and technical training for youth. Axis Bank and Bandhan jointly launched a Rs.100-crore initiative on providing skills training and assets to the marginalized in West Bengal. Job creation remained a key challenge
The government could create only one million jobs against the target of 50 million jobs during the 11th Plan period that ends March 31, 2012. It has now set a enterprising target of creating 60 million jobs during the 12th Five Year Plan.
As a step towards this, the government unveiled a new Manufacturing Policy that promises 100 million new jobs. India is also on the path to dusting off the Apprentices Act to create an industry-driven apprenticeship regime.
2011 was the first year when the WorldSkills Competition got significant coverage in the media in India. A 16-member India contingent participated in the competition in London. While Indians did not win any medals, they surely showed the determination to become the skills reservoir of the world by participating in the event.
As we move to the next year, we appear to be in the right direction, even though we know we have a long way to go. Skills do not form the social fabric of India as yet. To have social currency in India, the acceptable tags are generally of an engineer, a doctor, a master of business administration. Skills, such as plumbing, electrician and masonry have little social currency, and this is evident even in our matrimonial advertisements. Changing the social perception about skills, therefore, is our big challenge for 2012. Creating a social norm called 'Get Skilled' should be one of our key focus areas.
In India we observe a complex amalgamation of factors relating to poverty, home environment, social pressures and so on to which teenage children are susceptible. The child who drops out of the schooling system due to any of the above factors can rarely be brought back into training. In plain economics, they are already in the unorganized job sector and leaving it for vocational training constitutes a significant opportunity cost for them and their families. In other words, even free training has a cost that many are unable or unwilling to bear.
What then are we to do if we are to make an impact on a set of problems of this magnitude?
“CATCH THEM YOUNG AND WATCH THEM GROW” should be our motto
· The first place to start is undoubtedly the school where we can formally allow a parallel stream of vocation education in the 9th and 10th standards. (To promote vocational Training in schools, the Govt. has established a vocational cell within the CBSE, this scheme also helps to create a bridge between academia and industry) Students who are weak academically but have other strong abilities ought to be given a choice and counseled on this path, which will have academic elements, especially English and Math, but in a simpler form.
· Each school needs to set up labs / workshops for supporting training activities.
· If this is not possible in the school premises due to space constraints, there should be a tie up with partners who are offering vocational training; essentially they could be NSDC partners who are entitled to offer vocational training.
· A local network with industry, restaurants, retail establishments, and technical institutions/colleges in the area needs to be established so that an element of practical training can be brought into the curriculum and other resources leveraged.
· Finally, a certificate could be issued by the state, the school or the training partner, once the student has successfully completed the vocational training requirements. This may not hold the same status of an SSLC but will be far better than letting the child drop out with nothing to show for his or her future.
The above model could use skilled people drawn from the extensive pool of unorganized labour as faculty. These skilled trainers can be made to go through a train the trainers program to fill gaps in their approach or methodology.
In the construction industry for example, we have many carpenters, plumbers etc., who are skilled and experienced, but not educated in the conventional sense. If these people are brought in as faculty and seconded to a vocational training faculty from the school who handles the formalization of the instruction, there could be a complete win-win for both the student and the trainer.
We are at a cusp situation where we need to face the challenge of Streamlining the Vocational Training Structure in order to reap the benefits of the huge potential of Human Resource in India.
