Skill development has emerged as a key strategy to realize the potential of demographic advantage of having the youngest workforce with an average age of 29 years in comparison with the advanced economies to create human resource for improving country’s competitiveness and growth. The National Skill Development Mission launched by the Government of India envisions skilling at scale with speed and standards with focus on strengthening Institutional Training, Infrastructure, Convergence, Training of Trainers, Overseas Employment, Sustainable Livelihoods and Leveraging Public Infrastructure. The National Policy for Skill development and Entrepreneurship 2015 provides an enabling framework to realize the vision. The National Policy targets to skill and reskill about 400 million by 2022. It’s a huge challenge considering that the percentage of the formally trained in India are low at 4.69 per cent of the total workforce compared to countries like Germany with 75%, Korea with 96%.
The policy framework outlines paradigms and enablers to realize the potential of demographic advantage which includes among others addressing aspiration & mobilization; quality & relevance; access & outreach with inclusivity and leveraging technology. Given that India has a huge and heterogeneous informal sector where skill training is generally carried out through individual learning, observation or a transfer of skills from a master craftsman/crafts woman to an apprentice, to give a formal recognition to skills Recognition of Prior Learning (RPL) has been introduced to facilitates an assessment of the skills acquired by the individual through experience, observation and self-learning followed by a certification. The attempt is to bring mobility in the career.
The schism between the skill demands of industry and the aspirations of the youth has widened leading to a paradoxical situation where industry is looking for skilled manpower and skilled youth are looking for jobs. The latest India skill Report indicates that only about 47% coming out of educational institutions are employable.
A look at the demographic profile across states reveals significant variation across states. Demographically speaking there are two Indias, with different policy concerns: a soon-to begin-ageing India where the elderly and their needs will require greater attention; and a young India where providing education, skills, and employment opportunities must be the focus. Of course, heterogeneity within India offers the advantage of addressing some of these concerns via greater labour mobility, which would in effect reduce this demographic imbalance. It is crucial to understand the nature of demographic bulge in each State.
A look at the age structure of the population reveals that the Southern States like Goa, Tamil Nadu, and Kerala have a higher median age between the range of 29 to 31 years, due to early fertility transitions and will soon be ageing. The hinterland states such as Uttar Pradesh, Bihar, Jharkhand, and Rajasthan have a low median age between 20 and 22 years of age. Thus this northern belt will remain young with a rising working age population. This requires addressing skill challenges of access, equity, relevance and financing differently. Similarly, to address the mismatches between supply and demand it is necessary to harmonize the youth aspirations with industry demand and the training offered by training institutes. This points to the need for developing skill indicators to address the challenges of skilling across states.
What are Skill Development Indicators?
Skills and knowledge are driving forces of economic growth and social development for any country. Given that developing skills requires huge investments, it is necessary to have availability of real time data on what constraints skill development in a region/area/district/state; identification of sectors where skill development is most needed; how well the skills of individuals match those required in the labour market, and the outcomes of various interventions undertaken thus far.
The first such efforts to create Indicators for skill development has been made by the OECD that established the World Indicators of Skills for Employment (WISE) in close collaboration with the World Bank, ETF, ILO and UNESCO. The conceptual framework includes focus on contextual factors such as GDP, population, access to internet, employment in informal sector; factors affecting skill acquisition such as educational attainment, literacy rate, enrolment ratios, vocational programme, participation in apprentices and training; factors affecting skill requirement such as employment share by level of education, occupation, incidence of self-employment, skill use and outcomes in terms of growth in GDP, labour productivity, employment rate, earnings etc. The focus is on identifying skill gaps, changes in earnings and unemployment by education.
Adapting from this framework, an attempt has been made to develop indicators addressing various challenges in improving the efficiency of the Indian skill ecosystem in terms of matching skills across sectors/regions so that we can realize the potential of our youth power. The indicators would also help in measuring the outcomes of various interventions and to institutionalize a focus on improving outcomes (Access, Equity, Quality, Relevance and Finance) in India.
The Skill Development Indicators (SDI) would bring the available data from different sources at one place – as a single resource – for the purpose of evaluation of skill development initiatives across the country. The SDI would enable the states to evaluate and compete with their own past performances and comparing the changes in the indicators from time to time will make it possible to track improvement or progress of states and of different skill development programmes. The indicators would also facilitate sharing of best practices across different sectors and States/UTs. It would help in assessing the match between employers’ needs and future labour market opportunities. Based on the assessment of existing policy initiatives and their outcomes, the future course of policy action can be planned or modified.
The indicators have been classified under broad parameters of Access, Equity, Quality, Relevance and Finance.
The parameter of access would measure the capacity and outreach of the programmes. For instance, the indicator on Neither in Education nor in Employment or Training (NEET) will portray the percentage population of youth who are ‘missing’.
Relevance would measure the ease of entry to the labour market with an enhanced employability.
Equity will measure the equal accessibility of the opportunity to all and quality will evaluate whether the training imparted meet the required standard of employability. For instance, the indicator on Compliance Rate of National Skill Qualification Framework (NSQF) will explain the extent of adherence of courses to established standards. And finally, the parameter of finance would measure the cost-effectiveness of the funding.
The dearth of reliable data is a pressing challenge in developing these indicators. However, the creation of indicators itself is expected to catalyze the availability of reliable data on a periodic basis. This push is also for the need to generate data on a space that is leading up to the labour market and will also emphasize on the need of systematically including key questions on skills in employment-unemployment surveys such as the Periodic Labour Force Surveys. Once the indicators are finalized, an index can be built that can rank the States based on their performance outcomes. This assessment at the national level would facilitate in coming up with mid-course corrections in policy and implementation strategy. The measurement of outcomes will also throw light into various skill development models that are successful and bring out the best practices for further emulation.
With the Fourth Industrial Revolution round the corner, it needs to be ensured that our youth thrives any shift in the skill requirements in both foundational soft skills and skills specific to different job roles. Thus the need of the time is to build the evidence that can redirect the policy solutions to address the constraints, make the policy inclusive and sustainable according to the demographic context of each state to realize the potential of youth bulge and make India skill capital of the world.
* Ms. Sunita Sanghi is Senior Adviser and Ms. Lakshmi Parvathy and Dr. Sakshi Khurana are Young Professionals at NITI Aayog.
Views expressed are personal.
National Policy for Skill Development & Entrepreneurship, MSDE 2015 and Global Education Digest, UNESCO