As structural, demographic and technological shifts transform the Indian economy and the nature of work, new entrants to the workforce will have to be skilled and made employable. Approximately 70 million additional individuals of working age (15-59 years) are expected to enter the country’s labour force by the end of 2023 using the same estimation model, the total workforce will then include approximately 404.15 million people, including 59 million youth (individuals aged 15-30 years). According to the periodic labour force survey, the strategies for reskilling and increasing the skills of the current workforce, as well as formal recognition of informally acquired skills, will also have to be reinforced.
Against this backdrop, India is driving unique initiatives to convert its demographic potential into a dividend that will fuel the country’s growth. At the same time, ageing populations found in several developed countries present opportunities for the migration of skilled persons from India to the benefit of both the host and destination countries.
There have been three major challenges to skill development in India —
1. Pathways for international mobility
2. Public sector collaboration with industry
3. Women’s low participation in the labour force
Pathways for international mobility
India is committed to becoming the ‘skill capital’ of the world and structured efforts such as the India International Skill Centre (IISC) programme may boost it. As a pilot project in 2018, 14 IISCs were likely to be set up across India through the NSDC but in April 2022, the country’s first Skill India International Centre was inaugurated by Union Skill Development and Entrepreneurship Minister, Dharmendra Pradhan, in his home state Odisha.
Indeed, IISCs should be a pan-India institution. Now, after the announcement made in the Union Budget 2023-24, the NSDC must take a call to set up 30 IISCs in a public-private partnership to implement Pravasi Kaushal Vikas Yojana (PKVY) for youth seeking global mobility for jobs. As part of the IISC program, skill training on international standards and Pre-Departure Orientation Training (PDOT) will be imparted to candidates to make them employable globally.
A new, market-driven IISC network is needed to counsel and guide potential emigrants with a focus on skills tests, upskilling, language and pre-departure orientation. Furthermore, the Governments of India and Japan are cooperating to implement Japan’s Technical Intern Training Programme (TITP), an on-the-job training scheme providing three to five years of internship opportunities for foreign nationals in Japan. Technical collaborations have been undertaken with countries such as the UK, Australia and the UAE for benchmarking and mutual recognition of standards. Government-to-government and B2B partnerships need to be developed for new markets such as those in Western Europe, Canada, Australia and East Asia to increase the mobility of the blue and white-collar Indian workforce.
Collaboration with private sector
India’s workforce above 30 years of age is 262 million people, of which 259 million are currently employed and need to be future-ready. To drive reskilling and upskilling initiatives and to develop close collaborations with employers to prepare their workforce for new technologies and the future of work, there are a variety of skill development models like government-funded programmes that fully or partially subsidise training and apprenticeships, market-led training, and industry-led on-the-job training. The National Skill Development Corporation (NSDC) stimulates private sector participation in the Indian skill development sector.
There is a vast segment of informal workers in India, many of whom possess skills that have not been formally recognised. RPL (Recognition of Prior Learning) interventions are critical in this scenario, as holding a formal certification can improve an individual’s bargaining power. Various analyses reveal that the monthly incomes of RPL-certified individuals were on average 20 percent higher than those who had not been RPL-certified.
A survey conducted by the Centre for Monitoring Indian Economy (CMIE) suggests there are more than 390 million individuals who have acquired skills informally, through self-learning, on-the-job learning, inherited skills or other sources. Of these, 384 million are working, showing the scope for RPL and apprenticeship-related interventions. Both of these interventions typically involve collaboration with industry and the private sector, even when they are part of publicly funded programmes.
Creating avenues for private-sector engagement has been a crucial strategic pillar for India. Skill development faces several forms of market failures, including information asymmetries — a skilled person knows his or her skills, but a potential employer does not. If employers had all the information, their willingness to pay for a skilled person would rise. RPL is an example of an intervention to address information asymmetry.
Women’s participation in workforce
A third focus area is to address the challenge of low female participation in the workforce. The labour force survey data suggests that of the country’s workforce of 395.2 million, only 91.6 million are women. Skilling initiatives, complemented by a wider push towards empowerment through gender sensitisation, creation of economic opportunities and economic and social support can be used to raise this number.
Preparing women for forms of employment that are more attractive to them, such as the gig economy and its more flexible work models, is especially relevant, given that 229.2 million women out of the 301.5 million who are not in the workforce report their status as homemakers performing domestic duties only.
In the beauty-wellness sector, still there is a huge scope for women to be skilled. There are reasons why I insist on a special focus on the beauty and wellness sector. With the rise in awareness about holistic well-being among people in India, the spending on beauty and wellness services and products has increased. According to the Indian Beauty & Hygiene Association (IBHA), the per capita spending on beauty and personal care products was around Rs 600 per annum in 2019, which is expected to increase by 40 percent by 2024. The beauty and wellness market in India was valued at Rs 901.07 billion in 2018 and is forecast to reach Rs 2,463.49 billion by 2024, expanding at a compound annual growth rate (CAGR) of around 18.50 percent during 2019-2024.
We need to note that the rise in the income of the middle class has propelled the demand for beauty and wellness services and products. In India, people have become conscious about their appearance and are constantly spending money to enhance the way they look. Consumers Paying frequent visits to salons and spa services have resulted in the escalating demand for beauty services and products. This has allowed for the significant growth of the segment.
The writer is co-founder and MD, of Orane International, a training partner with the National Skill Development Corporation (NSDC), and Network Member of India International Skills Centres, an initiative of GoI. Views expressed are personal.
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