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Skilling India
No Time To Lose
SUP P O RTE D BY
Skilling India
No Time To Lose
“We have no time to lose, and having no time
we must scramble for a chance.”
—Rabindranath Tagore
This NCAER Report has been made possible by a generous grant from the New Skills at Work
programme of J.P. Morgan.
Contents
About NCAER
NCAER, the National Council of Applied Economic Research, is India’s oldest and largest inde- Forewordv
pendent economic think-tank, set up in 1956 to inform policy choices for both governments and NCAER Skilling India working papers vi
industry. For more than six decades, NCAER has served the nation with its rich offering of applied Acknowledgmentsvii
policy research, unique data sets, evaluations and policy inputs to central and state governments,
corporate India, the media and informed citizens. It is one of a few think-tanks world-wide that Chapter 1
combine rigorous analysis and policy outreach with deep data collection capabilities, especially for The urgency of skilling India’s workforce 1
large-scale household surveys. India’s economy is on the move— but its workforce has barely budged 1
More Indians of working age, with fewer young and old dependent on them— a
© 2018 National Council of Applied Economic Research/NCAER demographic dividend or a curse? 1
High-growth sectors are not creating jobs in those sectors 2
This report was first published in October 2018. Why does India have economic growth without jobs? 3
Escaping the vicious cycle 7
This report is a product of the research staff of NCAER. The findings, interpretations and conclu-
sions expressed herein do not necessarily represent the views of NCAER or those of its Governing Chapter 2
Body. Acquiring skills
How best to impart them 11
National Council of Applied Economic Research Simplifying skill definitions makes it easier to see what’s needed 11
11, Indraprastha Estate The world’s largest school system is not producing enough literate and numerate workers 12
New Delhi–110002, India Technical and vocational education are too supply-driven and short term 13
Telephone: +91–11–2337–9861 to 63 Apprenticeships for learning-by-doing and learning-while-earning 18
Fax: +91–11–2337–0164 Industry clusters for supplying skills to meet local demand conditions 19
Email: info@ncaer.org Imparting skills on the job to make skilling more demand-driven 19
www.ncaer.org Turning the vicious cycle virtuous: acquiring skills and generating good jobs 20
Focus and consolidate technical and vocational education 26
Reach special groups 26
Ensure that skills are portable across other jobs and sectors 29
Appendix A2.1 A glossary of skills 30
Appendix A2.2 Explanations for ratings in table 2.1 32
Chapter 3
About the New Skills at Work–India Programme Matching skills
The J.P. Morgan New Skills at Work–India programme seeks to focus on the three critical elements How best to adjust them 39
of employment, employability and education; engage key stakeholders from government, industry The supply of skills doesn’t match the demand 41
and skill training providers; and as a research programme meaningfully contribute both to policy An army of educated unemployed— a nd acute shortages of skilled workers 45
as well as practice pertaining to employability, labour markets and the skilling supply chain. Fixing the mismatches requires more than vocational skill training 46
Connecting women to work 49
Increasing the mobility of labour 50
About JPMorgan Chase & Co. Unleashing opportunity entrepreneurs 51
JPMorgan Chase & Co. (NYSE: JPM) is a leading global financial services firm with assets of Formalising informal workers by recognising prior learning 52
US 2.5 trillion and operations worldwide. The firm is a leader in investment banking, financial India’s new knowledge economy requires new skills 54
services for consumers and small businesses, commercial banking, financial transaction process-
ing, and asset management. A component of the Dow Jones Industrial Average, JPMorgan Chase Chapter 4
& Co. serves millions of customers in the United States and many of the world’s most prominent Anticipating skills
corporate, institutional and government clients under its J.P. Morgan and Chase brands. For more How best to adapt them 61
information about JPMorgan Chase & Co., visit www.jpmorganchase.com. Exchanging life-time employment for life-time employability 61
Adapting to structural and technological change 62
While this report has been supported by J.P. Morgan, the content and opinions are those of authors Anticipating the skills of the future 65
alone and do not reflect the views of J.P. Morgan, JPMorgan Chase & Co. or any of its affiliates.
ii iii
Foreword
Policy recommendations for adapting and anticipating skills 73 India’s future holds great hope for its millions. framework for policymakers and practitioners
Its working-age population is growing faster to use to design, execute and evaluate skilling
Boxes than its population of young and old depend- pathways that can help break the cycle of poor
2.1 “Learn and Earn” at Boeing and Saint Gobain 17 ents. This demographic dividend comes once in skilling and slow creation of good jobs —the
2.2 Demand-driven interventions for on-the-job training in large firms 20 a nation’s life. If the majority of Indian workers low-skilling trap that India is caught in. The
2.3 The Wheebox Employability Skills Test: India Skills Report 2017 and 201826 in this transition are productively employed in Report argues that the three-part framework of
2.4 Boosting entrepreneurial skills 27 good jobs, and earn and save well, India can acquiring, matching, and anticipating skills provides
3.1 In search of the public-sector job 48 see a sustained long-term growth spurt that it a way of designing, executing, and evaluating
3.2 The knowledge economy and skills 54 badly needs to rise to its potential as an eco- policies and programmes to accelerate skilling
4.1 Entrepreneurial initiatives to improve farm productivity 67 nomic powerhouse. India can then become rich India, and to move from its current vicious
4.2 Young women in plastics 69 before it becomes old. Otherwise, it will forfeit cycle to a virtuous cycle of better skilling and
4.3 Digital villages 72 its demographic dividend. faster creation of good jobs.
4.4 Indian weaver micro-entrepreneurs connect to startup digital aggregators 73 For the majority of Indians to be in good jobs All stakeholders in the skilling space
requires them to have the skills that employers must work together to acquire and impart,
Figures and entrepreneurs need. India’s skilling para- to match and adjust, and to anticipate and
1.1 More workers mean fewer dependents 2 dox is that the labour market is characterised adapt the skills that India will need in the
1.2 More regular employees in smaller firms—more contract workers in larger firms 4 by dwindling opportunities in agriculture, next three decades to generate good jobs for
1.3 India’s 468 million jobs: From baskets to bytes 5 there is much potential for jobs in manufactur- its rapidly expanding workforce. This impera-
1.4 Ratio of wages/rental price of capital in organised Indian manufacturing 6 ing and services, but there are not enough peo- tive calls for distinct roles and responsibilities
1.5 The vicious cycle of low skills and few good jobs—a low skilling trap 7 ple with the right skills, even for today’s jobs. for employers, for governments, for skill pro-
2.1 How skills interact 12 While IBM has more employees in India than viders and for workers. And it calls for mutu-
2.2 Lagging behind other BRICS nations, more than 30% of India’s workers have only a in the US, ever more Indians are struggling to ally reinforcing policies, actions, incentives
primary education and only 18% have a secondary education 13 find work. And while India grapples with the and understanding among and between these
2.3 Big numbers for India’s education and skilling ecosystem 14 legacy of its existing skills–jobs mismatch, it four key stakeholders to successfully impart,
2.4 India’s vicious cycle of low skills and few good jobs—a low skilling trap 21 must pay attention to anticipating the skills of match and anticipate skills for India in the
2.5 Moving to a virtuous circle of higher skills and many good jobs—escaping the low tomorrow, when it sometimes is not even clear 21st century.
skilling trap 21 what those skills might be. We need a 15-year, 2020–35 perspective
3.1 Most workers have little education 41 This NCAER Report on Skilling India has the plan focused on transferable skills that can
3.2 Rural–urban wage gaps 51 subtitle No Time to Lose. Indeed, much time has meet the demand from industries now and in
4.1 Low-productivity sectors employ higher proportions of the workforce and vice versa 62 already been lost. Policymakers face the triple the future. To prepare such a plan, the govern-
4.2 Venture capitalists identify why Indian startups fail 66 challenge of incentivising the creation of more ment should establish a Commission for 21st
4.3 Smaller firms are far from ready to use information and communications technology 69 well-paying jobs, creating efficient pathways Century Skills. This NCAER Report could pro-
4.4 Digital literacy is required for managers and permanent workers 70 to skill acquisition and job matching to ensure vide a framework for the terms of reference for
4.5 Small and medium-size enterprises are not digitally engaged 70 workers have the right skills, and protecting such a Commission.
4.6 Computer literacy is low for those 15 and above— a nd even lower in rural areas, 2014 71 low-paid, low-skilled workers with social secu- This Report starts with a quotation on its
4.7 Working together to skill India: governments, providers, employers and workers 74 rity benefits. An additional challenge comes opening page from Rabindranath Tagore’s
from the massive number of workers aged Gitanjali, “We have no time to lose, and hav-
Tables 30–59 who are in the workforce but have to be ing no time we must scramble for a chance.”
2.1 Rating India’s largest skilling schemes (see also Annex 2.2) 23 reskilled or upskilled. Though not included on the opening page,
3.1 Where are the 468 million jobs? 40 After suggesting simple ways of thinking Tagore’s next line written in 1912 reads, “We
3.2 Demand for skills across occupational roles 42 about the three types of skills that are are too poor to be late.” India has achieved
3.3 Mismatches between supply and demand 46 fundamental—foundational, employability much since Tagore wrote those words, yet it
3.4 Education and employment of Indian youth 48 and entrepreneurial —
this Report offers a cannot afford to be late.
3.5 Male–female distribution of managers by sector 50
4.1 Sectoral output and employment 63
4.2 What skills are most transferable? 64 Shekhar Shah
4.3 Transitioning from skills to jobs in 21st century India 66 Director-General
iv v
NCAER Skilling India working papers Acknowledgments
1. Where are the Jobs? Skill-based Input-Output Employment Linkages by Sector for India This Report has been prepared by a team at Ghosh, Mukesh Gulati, Abhishek Gupta,
Tulika Bhattacharya and Bornali Bhandari NCAER led by Bornali Bhandari and com- Mukesh Gupta, Raj Gupta, Lisa Heydlauff,
prising Pallavi Choudhuri, Mousumi Das, Frank Hoffmann, Renana Jhabvala, Aruna-
2. Is India’s Education System providing 21st Century Basic and Employability Skills? Tulika Bhattacharya, Soumya Bhadury and chalam Karthikeyan, Antara Lahiri, Jürgen
Mousumi Das Girish Bahal, with additional contributions Männicke, Jancy Mathews, Abhiroop Muk-
by Saurabh Bandyopadhyay, Renu Gupta and hopadhyay, Sheeja Nair, Arun Nalavadi, Kedar
3. India’s Employment Challenges and the Demand for Skills Seema Sangita. The team was assisted for data Panda, Matthias Pilz, J. V. Rao, Biswajit Saha,
Pallavi Choudhuri analysis and literature work by Ajaya K. Sahu, Alekh Sanghera, Ratna Silroja, Bikrama Dau-
Praveen Rawat, Mridula Duggal, Rohini Sany- let Singh, Deepti Singh, Lokesh Singh, Anup
4. The 3–E Challenge in India: Education, Employability, and Employment al, Jahnavi Prabhakar, Heena Bhatia, Aishwar- K. Srivastava, Johannes Strittmatter, Vandana
Bornali Bhandari ya Agarwal, Aarti Garg, Sanskriti Goel, Upend- Thallur, Shamik Trehan, Aditya Tyagi, Mahesh
er Kataria, Anjali Parashar, Sudhir Swarup and Venkateshwaran, Sher Verick, Wilima Wadh-
5. Providing the Full Range of Employability Skills in India Sumit Aggarwal. Bruce Ross-Larson was the wa and Jürgen Wuttke.
Bornali Bhandari principal editor. The team would like to thank Early versions of the research papers on
Rajesh Chadha and D. B. Gupta for their con- which this Report is based were presented at a
6. The Role of Pedagogy in Developing Life Skills in India stant advice and support. The work was car- conference in New Delhi in October 2016. We
Renu Gupta ried out under the general direction of Shekhar thank the participants at the conference for
Shah, with assistance from Akansha Dubey, their valuable comments.
7. How do Technical Education and Vocational Training Impact Labour Productivity in India? and subsequently Anwesha Pandey. Sudesh Bala served as executive assistant to
Seema Sangita The team was guided by a panel of experts the project, Sangita Chaudhary as team assis-
comprising Dilip Chenoy, Rukmini Banerji, R. tant, and Praveen Sachdeva as technical support.
8. An Exploratory, State-wise Education-Employability-Employment Index for India C. Bhargava, Pramod Bhasin, Rajesh Chakra- Rabi Narayan Panda provided financial manage-
Saurabh Bandyopadhyay, Bornali Bhandari, Ajaya K Sahu and Praveen Rawat barti, S. Ramadorai, R. C. M. Reddy, and ment services, Anupma Mehta editing support,
Manish Sabharwal. We thank them for their and Jagbir Singh Punia publication support.
9. Viewing Skilling India from the ground up: Project case studies valuable insights and guidance. Arup Mitra, Report design, editing and production were
B. N. Goldar, and Anil K. Sharma provided coordinated by a team at Communications
Available from http://www.ncaer.org/skillingindia/workingpapers. valuable comments on early drafts of several Development Inc. led by Bruce Ross-Larson
working papers. and including Joe Caponio, Mike Crumplar,
The team undertook a range of interviews Debra Naylor and Elaine Wilson.
for this Report. For their valuable time and the This work was generously supported by a
many insights they shared, we thank our inter- grant from the New Skills at Work programme
viewees, including Karen Adams, Aradhna of J.P. Morgan. We would particularly like to
Aggarwal, Ishwarya Balasubramanian, Rama- thank Maneesha Chadha, Diana Tsui, and
ni Balasubramanian, Jagmohan Bhogal, Rabin Chauncy Lennon for their patience and under-
Bose, Sujoy Chatterjee, Sandhya Chintala, standing as this Report went through sever-
Neeta Pradhan Das, Sonalde Desai, Ravi Dha- al incarnations and for their partnership with
nuka, Ambarish Dutta, Judith Evers, Arindam NCAER.
vi vii
Highlights
India has a skilling India’s 468 million
paradox workers have to move
from baskets to bytes
India accounted for 25% of the world’s estimat-
ed 7.5 million bachelors in science and engi- The transition of India’s labour force from
neering in 2014. No wonder the world’s leading small, unregistered firms in the informal sec-
tech companies have their largest operations tors to small, medium and large formal firms
in India. Yet, as the Economist notes, even as has been slow. Rigid labour laws and poor
“India’s labour force will soon overtake China’s infrastructure impede the pace of transi-
as the world’s largest … the country is strug- tion from informal to formal jobs. So, what’s
gling to generate opportunities for a workforce needed?
with the wrong skills.” The 2015 policy of the Conceptually the answer is clear: skill exist-
Ministry of Skill Development and Entrepre- ing informal workers (many of them female)
neurship notes, “Our country presently faces and new workers based on industry require-
a dual challenge of paucity of highly trained ments and deploy them in a rapidly growing
workforce, as well as non-employability of formal sector. Efficiency is higher in the formal
large sections of the conventionally educated sector, costs are lower and profit margins are
youth, who possess little or no job skills.” This bigger, all translating into greater job-gener-
is India’s skilling paradox: Dwindling oppor- ating potential. Formalisation increases firms’
tunities in agriculture, much potential for jobs incentives to invest in upskilling their work-
in manufacturing and services, but not enough ers. It also increases the workers’ own incen-
people with the right skills. tives to remain skilled, besides providing them
with better working conditions and health and
social security benefits.
BYTES
High skill
IBM Now Has More
Employees in India 15% in Manufactu
ring
Than in the U.S.
27%
IBM has shifted its center in S
of gravity halfway around 10 er v
ices
the world to India. %
in
The New York Times, Co
49%
28 September 2017 ns
tr
uc
tio
n
in A
al
rm
gri
Ever More Indians
cul
fo
tur
Are Struggling to
%
l/8
e
Find Work a
rm
The country is missing fo
out on its “demographic
in
%
dividend” 92
The Economist,
14 September 2017
BASKETS From page 5.
Low skill
From back cover. ix
But India is trapped in a Moving to a virtuous circle Simplifying skill A three-part framework
vicious cycle of low skills of better skilling and more definitions makes it for thinking about how
and few good jobs good jobs is imperative easier to see what’s to make India’s skilling
needed ecosystem work better—
The combination of inadequately skilled work- Policymakers need to consider a three-pronged acquiring, matching,
ers, out-of-date labour laws, a rising ratio approach. First, completely clear the Central and Cognitive skills are basic skills of literacy and anticipating skills
of wages to the price of capital and persis- State underbrush of policy distortions embed- numeracy, applied knowledge and problem-
tent informality are feeding on each other— a ded in dysfunctional and out-of-date labour and solving aptitudes and higher cognitive skills Acquiring, imparting and assessing skills—requires
self-perpetuating vicious cycle that results in industrial laws and regulations, many of them such as experimentation, reasoning and crea- change in K-12 education, vocational and tech-
fewer good, formal jobs than India is capable hangovers from India’s famous licence raj and tivity. Technical and vocational skills are the nical education and on-the-job training. Match-
of and badly needs. Greater informality drives from earlier colonial times. Also ensure that physical and mental ability to perform specif- ing and adjusting skills—how best can job seekers
poor skilling, employers choose machinery laws and regulations no longer impede convert- ic tasks using tools and methods in any occu- with low or high skills find productive work
over men, and few good jobs are created, driv- ing informal to formal jobs. Formalisation will pation. Social and behavioural skills include and how can firms find workers with gener-
ing India’s burgeoning labour force further into increase firms’ incentives to invest in upskilling working well with others, communicating well al and specialised skills. Anticipating and adapt-
informality. their workers. It will also increase the workers’ with others, listening well to others and gen- ing skills—the continuously evolving landscape
incentives to remain skilled, besides providing erally being agreeable and outgoing. Everyone of jobs and shorter technology cycles require
them with better working conditions and health has these skills to varying degrees. Combin- development of core skills that are transferable
and social security benefits. Second, promote ing these types of skills gives foundational skills, across roles. India can successfully create the
public and private investments in sectors identi- employability skills and entrepreneurial skills. self-reinforcing virtuous circle of acquiring–
fied as most promising in generating jobs direct- matching–anticipating skills as suggested in this
ly within that sector and indirectly across sec- Report, and in parallel create the economic and
tors. Third, skill the workforce, covering both Foundational skills social conditions for rapid, sustained economic
existing and new workers, to match employers’ growth. If it can do this in the next five years,
needs and promote formal jobs. After suggest- there is no reason why its aspirations to provide
Technical
ing a simple way for thinking about the types Basic and and opportunity and well-being to millions of its
of skills required, this report offers a frame- higher vocational citizens across the country cannot be realised.
cognitive
work for skilling India—acquiring, matching Otherwise, with every passing year and each
and anticipating skills—that can help break new generation that is not adequately skilled,
the cycle of poor skilling and low job creation. Social and the backlog of wasted opportunity and unmet
There is no time to lose. behavioural skill needs can only become larger, making
catch-up increasingly difficult.
Employability skills
MATCH
&
Basic and Technical
higher and ADJUST
cognitive vocational
Slower Faster
growth growth
of good, of good, Social and
formal jobs formal jobs behavioural
Higher cost Lower cost
of skilled Greater of skilled Less
workers workforce workers workforce
relative to informality relative to informality
Entrepreneurial skills
capital costs capital costs
Basic and Technical
higher and
cognitive vocational
ACQUIRE ANTICIPATE
More Fewer
poorly-skilled
Lower
incentives to
poorly-skilled Greater
incentives to & &
and fewer and more
well-skilled
acquire or
impart skills
well-skilled acquire or
impart skills Social and IMPART ADAPT
workers workers
behavioural
From page 12.
From page 21.
x xi
Acquiring skills—how best to impart them Matching skills—how best to adjust them
Required on the supply side of workers pro- demands. On-the-job training has to extend Required on the demand side of employers look- and vocational systems are imparting knowl-
viding skills are essential changes in India’s beyond large firms and be offered to workers ing for skills is having job seekers know how edge through oral and rote learning, but not the
schooling and skilling system—the world’s in smaller firms and to informal workers. Indi- they can find productive work with the skills broad range of foundational, employability and
largest—in vocational education and in on-the- an workers need to shift from lifetime employ- they have or should obtain, and having firms entrepreneurial skills needed for jobs. Along
job training. This also requires recognising and ment to lifetime employability. know how they can find workers with the right with job-specific knowledge and skills, firms
certifying the skills and prior learning of those How best to turn India’s many disadvan- skills. Educational attainment may be increas- seek innovation, complex social and emotion-
in the informal workforce. Not only does the tages into advantages? By making sure that all ing, but high unemployment rates among the al, and psychomotor skills that the education
overall quality of schooling and training have children are literate and numerate. By having educated signal significant problems for their system does not easily supply. Educational and
to rise, but the content has to address the work- the demand for skills from employers drive the employability. Even if workers read market sig- skilling institutions need to work more closely
places of today—and tomorrow. General edu- supply of skills by workers. By providing the nals better and understood the skills needed of with industry, through apprenticeships, train-
cation should impart social and behavioural full range of skills for becoming employed. By them better, the problem is that the education ing on the job and recognising prior learning.
skills as well as basic and higher cognitive ensuring that skills are transferable to other
skills, problem solving and systems thinking. jobs and sectors. And by ramping up assess-
Vocational education should develop and revise ments to know whether and what skills are
programmes nimbly to keep up with workplace being successfully imparted.
FIGURE 2.3 TABLE 3.3 Mismatches between supply and demand
Big numbers for India’s education and skilling ecosystem
SUPPLY OF SKILLS DEMAND FOR SKILLS
2,000,000 Indian institutions imparting skills HIRED WORKERS ENTREPRENEURS AND SELF-EMPLOYED PERSONNEL
300,000,000 Indians currently getting educated or 468,000,000 Indians now in jobs may Medium-skilled
Medium-high-
skilled worker/ High-skilled worker/ Self-employed High-skilled,
CEO/director/
opportunity
skilled and will be looking for work (or may not) be acquiring skills on the job Skills Educational attainment
Low-skilled
casual worker
operative/trade
worker
associate
professional
specialist trainer/
professional
High-skilled
manager
livelihood/necessity
entrepreneur
self-employed
professional
entrepreneur/
employer
ACADEMIC TECHNICAL VOCATIONAL ON THE JOB EXAMPLES OF JOBS
Routine cognitive skills Primary and middle school education
● ● ● ● ● ● ● ●
Ages 24+ DOCTORATE DOCTORATE IN ENGINEERING MEDICAL RESIDENTS SCIENTISTS
126,500 enrolled 30,600 enrolled JUNIOR RESEARCH ECONOMIC ADVISERS
Routine cognitive skills, ICT skills Secondary education
FELLOWS UNIVERSITY FACULTY
ASTRONOMERS and language skills ● ● ● ● ● ● ● ●
POLICY EXPERTS
Routine cognitive skills, ICT and Higher secondary education
language skills, financial literacy ● ● ● ● ● ● ● ●
Ages 22+ MASTER’S MASTER’S IN ENGINEERING ADVANCED TRAINING MASTER’S OF ENGINEERS
MANAGERS
3,900,000 enrolled 257,000 enrolled 28 institutions VOCATIONAL EDUCATION
DATA ANALYSTS Routine cognitive, nonroutine cognitive College education and above
350,000 have Launched 2015, TEACHERS
skills, core socioemotional skills, ICT
enrolled since 2007 no data available as yet STOCK BROKERS
JOURNALISTS skills, language skills, financial literacy ● ● ● ● ● ● ● ●
ARCHITECTS and knowledge and ability to apply
LAWYERS
Ages 19–21 BACHELOR’S ENGINEERING COLLEGES INDUSTRIAL TRAINING BACHELOR’S OF APPRENTICESHIP JUNIOR ENGINEERS Routine cognitive skills, nonroutine Technical education
TECHNICIANS cognitive skills, ICT skills, financial
800 universities 3,200 colleges
27,400,000 students 4,200,000 enrolled
AT ITIs VOCATIONAL EDUCATION
13,550 institutions 162 institutions
AND INTERNSHIPS
(2–4 year certificate)
CONSTRUCTION
SUPERVISORS literacy and knowledge and ability to ● ● ● ● ● ● ● ●
POLYTECHNIC 3-YEAR DIPLOMA 1,200,000 enrolled 10,200 students 2,400,000 OFFICE WORKERS apply, sector and job-specific skills
TV CAMERA
3,900 institutes COMMUNITY COLLEGES apprentices and OPERATORS
1,500,000 enrolled 157 colleges interns
Job-specific skills, one ICT skill, English Short-term skilling programmes
Ages 17–18 HIGHER SECONDARY (Grades 11–12) VOCATIONAL HIGHER PLUMBERS
language skills and some financial literacy ● ● ● ● ● ● ● ●
ELECTRICIANS
112,600 institutions SECONDARY
CONSTRUCTION
24,700,000 students 7,400 schools provide WORKERS Routine cognitive skills, knowledge and Long-term skilling programmes
472,000 students ability to apply and job-specific skills ● ● ● ● ● ● ● ●
● Worker cannot supply the skills that the job demands.
● Worker can perhaps supply the skills that the job demands with varying success ranging from barely to mostly.
Ages 15–16 SECONDARY (Grades 9–10) VOCATIONAL SECONDARY TEXTILE WORKERS
RETAIL CLERKS
● Worker can fully supply the skills that the job demands.
239,100 schools 108 schools provide HOSPITALITY Note: Red implies that there is demand for this but supply is limited, indicating a mismatch. Green indicates that there is a reasonable degree of match.
39,100,000 students WORKERS
BEAUTY THERAPISTS Yellow indicates that there is only a partial match. Black indicates that workers’ skills exceed what the job needs.
Source: NCAER, based on stakeholder consultations and literature reviews.
Ages 6–14 ELEMENTARY (Grades 1–8) LOW-SKILLED
WORKERS
1,450,000 schools
196,716,500 students
From page 46.
From page 14.
xii xiii
Anticipating skills—how best to adapt them India must get rich before it gets old
Understanding how structural and technological individuals—large firms need formal business India’s working-age population is growing fast- and save well. India then becomes rich before it
changes in this 21st century are radically alter- and accounting skills and high technological er than its population of young and old depend- becomes old; otherwise it will forfeit its demo-
ing today’s workplace and the nature of work is skills, and smaller firms need multitasking and ents. The growing share of the workforce in the graphic dividend.
imperative. While India must deal with its large adaptability to business practices. The 21st cen- population can be a “demographic dividend” The Indian policymaker’s first and foremost
and persistent backlog of unskilled informal tury Indian worker also needs transferable skills. that can improve both social and economic challenge, given this demographic opportu-
workers, it must also provide for its future to sus- Above all India needs to create an agile work- outcomes, if the higher numbers of workers are nity, is to spur economic growth that creates
tain rapid progress. Firms of different sizes are force that can anticipate and adapt to changes in productively employed. good jobs for new entrants to the job market
already placing different skill requirements on technology, automation and digitisation. The growing population share of the work- and, at the same time, to ensure that these new
force is a demographic dividend that comes workers have the right skills. A second, larg-
once in a nation’s life. This should raise the rate er challenge comes from the massive number
of economic growth if the higher numbers of of workers aged 30–59 who are already in the
workers are productively employed and earn workforce but have to be reskilled or upskilled.
80 dependents 1950
The Internet has Technological 21st century jobs per 20 workers
1955
changed how cycles are shorter will no longer Working
age (15–64) 1960
55.4%
people connect than ever, and be confined to 1965
POPULATION
to work, with digital disruption task-specific 1965 65 and over 1970
3.2%
more workers is likely to recur roles. Instead, Under 15
1975
41.4%
using cloud with greater the demand for 1980
computing, video frequency. multidimensional 1985
50 dependents
conferencing and skills will
1990
per 50 workers Dependent
population 1995
other means to increasingly grow. Working
age (15–64)
66.9% 2000
work anywhere, 2005
anytime. POPULATION
2020 2010
65 and over
6.6% 2015
Under 15
26.6%
Transferable Customer- The e-commerce 2020
skills relevant facing jobs with sector could 2025
46 dependents 2030
to multiple non‑routine create 14 million per 54 workers
Working 2035
workplaces are the interactive tasks jobs in logistics age (15–64)
68.4% 2040
key to promoting that depend on and delivery, 2045
POPULATION
workforce agility. soft skills can and 6 million in 2040
Working-age 2050
be expected to customer care, Under 15 65 and over
population
2055
21.0% 10.6%
grow. So can information 2060
jobs depending technology and 2065
69 dependents
on higher management. per 31 workers
2070
cognitive skills. Working
age (15–64)
2075
59.2% 2080
POPULATION 2085
From chapter 4. 2100
2090
Under 15 65 & over 2095
25.9% 15.0%
2100
0 10 20 30 40 50 60 70 80 90 100
Percent of population
From page 2.
xiv xv
Get all stakeholders to work together… India’s skilling challenge in numbers
Given the time it takes to skill both existing between these four key stakeholders to suc-
and new workers, all stakeholders in the skill- cessfully impart, match and anticipate skills for ◆◆ Nearly 1.25 million new ◆◆ Out of the more than
ing space must work together to acquire, match India in the 21st century. India needs a 15-year, workers aged 15–29 are projected 500 thousand final year
and anticipate skills that India will need in the 2020–35 perspective plan focused on transfera- to join the workforce every month bachelors students aged 18–29
next two or three decades to generate good ble skills that can meet demand from industries through 2022. who were surveyed, 54% were
jobs for its rapidly expanding workforce. This now and in the future. To prepare the plan the found to be unemployable.
imperative calls for distinct roles and respon- government should establish a Commission for ◆◆ By 2022, India will have about
sibilities for employers, for governments, for 21st Century Skills. This NCAER Report could 47 million more people ◆◆ 2 million Indian institutions are
training providers and for workers. And it provide a framework for the terms of reference between the working ages of imparting skills.
calls for mutually reinforcing policies, actions, for such a Commission. 19 to 59 than younger or older
incentives and understanding among and people. This demographic ◆◆ 300 million Indians are
dividend will peak in about 2040. currently in educational
institutions or acquiring vocational
◆◆ The roughly 70 million workers skills and will be eventually
Establish a Commission on 21st Century Skills
to prepare a 15-year perspective plan for
entering the workforce between looking for work.
2020–35 2018 and 2022 will need to be
skilled for a 21st century economy ◆◆ Women’s labour force
Shift from necessity to
Improve the investment climate and the ease
of doing business if India is to keep pace with participation was 21% in urban
opportunity entrepreneurs
technological change. areas and 36% in rural.
Connect private and public stakeholders
Scale up to reap economies of scale
better
◆◆ Many of the roughly ◆◆ Of rural and urban women aged
Provide in-service training for fresh
trainees, reskilling and upskilling for Deregulate labour markets while
468 million now in the 15–29, 49% are neither part of
simultaneously providing social security
experienced workers
workforce could be upskilled and the labour force nor pursuing
Adopt modern labour and Focus on quality and inclusion
reskilled—not easy because 92% education, general or vocational.
human resource practices
Go Prepare for the new face of are in the informal sector.
s ve ◆◆ Between 2005 and 2012,
Ensure corporate er r manufacturing
social responsibility oy n
15 million women dropped out
◆◆ Slightly more than half of India’s
pl
Commission ongoing,
m
of India’s labour force.
Em
Support employees
en
when employers have
regular, skill-related workers have school attainment
ts
labour market research
to retrench them below secondary school with no ◆◆ The share of female managers was
vocational training. 6% in computer manufacturing
◆◆ Of India’s current workforce, 31% and 12% in computer
Focus on employability—
are illiterate, 13% have a primary programming.
knowledge plus advanced
W
s
education, and 6% are college
id l
er
ke cognitive, non-cognitive and/or
il
Sk
or
rs technical and vocational skills ◆◆ The rural–urban male migration
ov graduates.
pr Sharpen academic–industry mutual
rates in India have been low at
interaction ◆◆ About 2% of the workforce has around 4% in recent decades.
Ensure flexibility in education and training formal vocational training, and ◆◆ 68% of Indian SME businesses
Acquire transferable skills Train students for a knowledge economy, with social 9% have non-formal, vocational are offline, and another 15% are
awareness
Learn to learn training. digitally connected but not using
Pursue flexible employment,
◆◆ There were approximately digital services. Only 2% marketed
not just lifetime careers From page 74.
48 million workers in products or services online.
construction and 16 million ◆◆ Technology cycles are shorter than
in textiles and apparel with no ever, and digital disruption could
vocational training.
…there’s no time to lose hit Indian workers hard: globally
◆◆ The unemployment rate for 75% of businesses expect that
graduates aged 20–24 was 29%, automation will require workers to
for those 25–29, 12%, and for develop new skills.
those 30–34, 4%. Retrospective numbers are from NSSO 68th Round
2014 (with data for 2011–12). Prospective numbers
are from Ministry of Skills and Development 2015.
xvi xvii1
The urgency of skilling India’s workforce
India’s economy is on the move—but its challenge is all the more difficult because tech-
workforce has barely budged nology is changing the nature of work every-
where, eroding the low-wage advantage that
India has surpassed China as the world’s fast- India could hope to enjoy in meeting domes-
est growing large economy. It has also moved tic and global demand. India’s aspirations to
toward a knowledge economy, and more become an economic superpower providing
broadly from agriculture to manufacturing and opportunity to millions of its citizens cannot be
services, but for the most part the Indian work- realised at this rate. Indeed, given India’s scale,
force has not changed. Indeed, policymakers, just the frustrated aspirations of its youth can
educators, trainers and firms face daunting cause social unrest and strife.
challenges in skilling India’s workforce to meet
the economy’s current and changing needs.
MATCH • Many of the roughly 468 million now in the More Indians of working age, with fewer
workforce need to be upskilled and reskilled young and old dependent on them—a
& —not easy because 92% are in the informal1 demographic dividend or a curse?
ADJUST sector, mostly outside the reach of formal
skilling.2 India’s working-age population is growing fast-
• Of today’s workforce 31% are illiterate, 13% er than its population of young and old depend-
have only a primary education and only 6% ents. The growing share of the workforce in the
are college graduates. Further, only about population can be a “demographic dividend”
2% of the workforce have received formal that can improve both social and economic
vocational training while only 9% have outcomes, if the higher numbers of workers are
nonformal vocational training.3 productively employed.
• The roughly 70 million new workers enter- Not only is the ratio of young and old
ing the workforce between 2018 and 2022 dependents to the working-age population
need to be skilled for a 21st century econ- dropping in India, but the trough in the trend
omy.4 They may have completed second- is projected to last longer than it did in other
ary education, but many are not employ- countries (figure 1.1). By 2022, India will
able because their cognitive and technical have about 47 million more people between
skills are not up to par, and their social and the working ages of 19 to 59, who are likely to
behavioural skills are lacking. be skilled with no jobs within the country. In
Between 2004 and 2011, data from the addition nearly 1.25 million new workers —
National Sample Surveys show, the Indian aged 15–29 — are projected to join the work-
ACQUIRE ANTICIPATE economy created only some 18.6 million jobs, force every month through 2022.7 By the mid-
& & or about 2.7 million jobs a year, far too few for
the almost 15 million young adults projected
dle of this century, India will have a larger
working age population than China. This is a
IMPART ADAPT to enter the workforce each year over the next vast potential, and the scale of economic activ-
five years.5 After 2011–12, various estimates ity that these workers can generate if they are
suggest weak job growth.6 India’s economic productively employed has been rarely seen in
growth over the past decade has for that reason human history.
been called “jobless growth.” But India can ill But if there are too few jobs, or not enough
afford to waste this vast human and econom- good jobs,8 the dividend becomes a curse.
ic potential. With every passing year and each As the young who form the population bulge
new generation that is not adequately skilled, today get older in five to six decades, India will
the backlog of wasted opportunity and unmet then have an aging population that has not
skill needs can only become larger, making accumulated enough wealth and well-being to
catch-up increasingly difficult. Meeting the be able to afford costly old-age care and medical
1As India’s birth rate falls, its working-age population grows faster than its population of young not only for high-skill workers but also for sector, good jobs. Further complicating policy
and old dependents medium-skill workers. For example in servic- responses to these challenges are geograph-
The growing population share of the workforce is a demographic dividend that comes once in a nation’s life. This should es, as NCAER’s research done for this report ic differences that make centralised solutions
raise the rate of economic growth if the higher numbers of workers are productively employed and earn and save well. shows, trade, hotels, restaurants, financing, difficult.
India then becomes rich before it becomes old; otherwise it will forfeit its demographic dividend. communication, real estate and business activi-
ties are creating substantial numbers of jobs for Inadequately skilled workers
FIGURE 1.1 More workers mean fewer dependents high- and medium-skill workers both within
Share of population and outside their sectors.11 In manufacturing, Possibly the most important explanation for
textiles, wood and wood products and furni- low job creation in India is the lack of ade-
ture and fixtures have the highest job-gener- quately skilled workers. India is among the
Working age (15–64) Working age (15–64) Working age (15–64) Working age (15–64)
55.4% 66.9% 68.4% 59.2% ating potential for low and medium-skill work- top five countries with the highest skill short-
ers, both within their own sector and across ages, with nearly two-thirds of firms (with 10
POPULATION POPULATION POPULATION POPULATION
1965 2020 2040 2100
other sectors of the economy. Manufacturing or more employees) surveyed recently by the
65 and over
3.2% sectors such as food processing, beverages and Organisation for Economic Co-operation and
65 and over
Under 15 Under 15
6.6%
Under 15 65 and over Under 15 65 & over tobacco, leather products, nonmetallic miner- Development (OECD) reporting difficulty find-
41.4% 10.6% 25.9% 15.0%
21.0%
26.6%
al products and textiles can create direct and ing qualified employees.15 Another survey had
80 dependents 50 dependents 46 dependents 69 dependents indirect low-, medium- and high-skill jobs. The nearly half of all employers reporting unfilled
per 20 workers per 50 workers per 54 workers per 31 workers challenge facing policymakers is to create the job vacancies due to talent shortages.16 The scale India is among
Percent investment climate and the supporting infra- and impact of formal post-school education and the top five
100
structure and regulations that can allow these training remains modest, with less than 3% of
countries with
90 sectors to grow more rapidly. the workforce undergoing formal skill training,
80
Working-age
India accounted for 25% of the world’s esti- and only about 9% acquiring skills through the highest
70
population mated 7.5 million bachelors in science and informal modes (apprenticeships and on-the-job skill shortages
60
engineering in 2014.12 No wonder the world’s training). A small share of workers get on-the-
leading tech companies have their largest oper- job training in-house while the vast majority of
50
ations in India. Yet, as the Economist magazine informal sector workers have no access to for-
40
notes, even as “India’s labour force will soon mal training. Over the years the government
30 Dependent overtake China’s as the world’s largest...the has introduced several schemes to deliver and
population
20 country is struggling to generate opportunities upgrade skills through a formal technical and
10 for a workforce with the wrong skills.”13 The vocational education and training system. And
0 2015 Policy of the Ministry of Skill Develop- efforts have been stepped up through such initi-
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 2055 2060 2065 2070 2075 2080 2085 2090 2095 2100
ment and Entrepreneurship notes, “our coun- atives as Skill India and Make in India.
Source: United Nations, Department of Economic and Social Affairs, Population Division, 2017 Revision of World Population Prospects, data acquired at website. try presently faces a dual challenge of paucity
of highly trained workforce, as well as non-em- Rigid labour laws
Spur economic ployability of large sections of the convention-
expenditures. To put it simply, to attain its India’s recent rapid GDP growth. But their share ally educated youth, who possess little or no job India’s employment protection legislation is
growth that rightful place and realise its aspirations, India in overall employment is less than 2%. They skills.”14 This is India’s skilling paradox: dwin- among the world’s most rigid.17 An example is
creates good must become rich before it gets old. produce more with less labour (their labour pro- dling opportunities in agriculture and lots of the prohibition of layoffs under the Industrial
The Indian policymaker’s first and foremost ductivity is about 5–10 times higher than in the potential for jobs in manufacturing and servic- Disputes Act, 1947, which requires a company
jobs for new
challenge, given this demographic opportu- overall economy), and they are generating jobs es, but not enough people with the right skills. with more than 100 employees to get approv-
entrants to the nity, is to spur economic growth that creates mostly for high-skill workers. In general these al from the appropriate government authority
job market good jobs for new entrants to the job market services are more skill-demanding than manu- for laying off even a single employee. Small
and, at the same time, to ensure that these new facturing and have high labour productivity, and Why does India have economic growth wonder that manufacturing industries in India
and ensure workers have the right skills. A second, larg- therefore services are an unlikely destination for without jobs? use more capital-intensive technologies than
that these new er challenge comes from the massive number low-skill job seekers.10 industries in other countries at comparable lev-
of workers aged 30–59 who are already in the India has a range of other service and man- India’s unusual pattern of “jobless” economic els of development.18
workers have
workforce but have to be reskilled or upskilled.9 ufacturing industries that can generate a lot growth, remarkable in a country destined to be Highly capital-intensive production meth-
the right skills of good jobs, both directly and through ripple the world’s most populous, is the result of both ods may be one response to India’s rigid
effects in related industries, but these have not supply and demand factors. On the supply side labour market regulations that make labour
High-growth sectors are not creating jobs been growing fast enough. Every sector in an there is an inadequate supply of skilled work- expensive (when adjusted for its productivity)
in those sectors economy has consumption and production ers. On the demand side three key factors— and prompt firms to substitute machinery for
linkages with other sectors and therefore has India’s inflexible and archaic labour laws, the labour. Another response may be the grow-
A key challenge is that India’s high growth sec- the potential to generate jobs not just directly low relative cost of capital compared to labour ing incidence of contracting in the Indian
tors are not generating direct jobs. Sectors such but also indirectly— i n other sectors and among and the overwhelming level of informality in labour market and the consequent decline in
as business services and information technology– firms of different sizes. Even within services manufacturing and services —constrain the labour intensity in organised manufacturing,
enabled services are contributing substantially to some sectors have high job-generating potential rapid creation of jobs, particularly of formal since contract labour does not show up in the
2 3muster roll meant for a company’s permanent in the real interest rate. The low relative price
FIGURE 1.3
employees. In manufacturing both capital-in- of capital is exacerbated by improvements in India’s 468 million jobs: From baskets to bytes
tensive production methods and contracting technology and automation, which are displac-
can be blamed for slow employment growth ing labour as firms try to stay competitive.
in large-scale, labour-intensive manufacturing BYTES
industries. Mostly informal jobs even outside agriculture, High skill
Illustrating the prevalence of contracting, poor working conditions for women, and a slow
the concentration of regularly employed work- shift from informal to formal jobs 15% in Manufact
u ring
ers is highest (27%) in small firms with 50 or
fewer workers, and the concentration of con- The informal employment share in nonagri-
tract workers is highest (21%) in large firms cultural activities is exceedingly large in India.
27%
in S
with 1,000 or more workers and in firms with Furthermore, sectors that have high informal- 10 er v
ices
201 to 500 workers (figure 1.2). For small and ity employ a sizable portion of female infor- %
medium firms with 200 or fewer workers, the mal workers with low wages and poor working in
concentration of regularly employed workers conditions. The informal employment share Co
49%
ns
is 55%, but for medium and large firms with in nonagricultural activities is as high as 84%, tr
uc
more than 200 workers, the concentration of and the share of female informal employment tio
Firms n
in A
contract workers is 55%. Contracting is thus close to 85%. Among individual nonagricultur-
al
have been more prevalent in larger firms reflecting the al activities— such as transportation, construc-
rm
gri
employers’ response wanting to circumvent tion, trade, manufacturing and services other
cul
fo
substituting
rigid labour laws. than trade or transportation — the numbers
tur
%
machinery for look similar. For example the informal employ-
l/8
e
labour due Low cost of capital relative to labour ment shares in construction and trade are the a
highest at a little over 97%. In construction the rm
fo
to the lower For organised Indian manufacturing the ratio female informal employment share is 99%, and in
%
relative cost of the real wage to the real rental price of cap-
ital has been steadily increasing over the past
in trade 98%. Similarly in manufacturing 87%
of employment is informal, with the female
92
of capital few decades, more steeply since the late 1990s informal employment share at 94%.20
(figure 1.4).19 This increase can explain the Most new jobs in the economy’s informal
declining labour intensity in organised man- sectors have extremely low productivity. And
ufacturing in India: firms have been substi- the transition of India’s labour force from BASKETS
tuting machinery for labour due to the lower small, unregistered firms in the informal sec- Low skill
relative price of capital. The drop in the rela- tors to small, medium and large formal firms
tive effective cost of capital can be attributed to has been slow (see figure 1.3). Rigid labour
an increase in real wages and a decline in the laws and poor infrastructure impede the pace
rental price of capital (due to the fall in the rel- of transition from informal to formal jobs. So,
ative price of capital goods), rather than a fall what’s needed?
FIGURE 1.2 More regular employees in smaller firms—more contract workers in larger firms
Regular employees Contract workers
50 or less
1,001 or more
18% 50 or less
1,001 or more 16%
27% 21%
501–1,000 51–100
10% 501–1,000 14%
51–100
13%
201–500 13% 101–200
17% 201–500 15%
101–200
15% 21%
Note: Left side: Employee distribution by factory size of regular employees. Right side: Employee distribution by factory size of
contract workers. Data are for 2012–13.
Source: Economic Outlook, Centre for Monitoring Indian Economy.
4 5FIGURE 1.4 Ratio of wages/rental price of capital in organised Indian manufacturing share of the school-age population in school is result is fewer formal jobs than India is capable
slipping. One report estimates that Bihar alone of and badly needs (figure 1.5).
25,000
has around 1.2 million out-of-school 6–13 This report addresses the key challenge of
Labour-intensive year-old children, some 20% of the total out- how India can break out of this vicious cycle
sectors only
of-school children in India.23 and move to a virtuous cycle in which good
20,000
Policymakers should thus adopt a decen- jobs can lead to better skilled workers who can This report
tralised approach for skilling and job creation be employed in more and better jobs. addresses the
and for coordinating and monitoring state, dis-
15,000 key challenge
trict and block initiatives. For this they should Creating a virtuous cycle of acquiring, matching
All industries annually map skills and sectoral priorities and anticipating skills of how India
across all Indian states, a task requiring new can break out
10,000
synergies and cooperative efforts between poli- Simply put India can break the cycle of poor
cymakers and executing agencies at the Centre skilling and low job creation by ensuring that from a low
and their state counterparts. adequate job growth accompanies economic skilling vicious
5,000
growth and ensuring that the workforce has
the necessary skills to be employable in the
cycle and move
0
Escaping the vicious cycle jobs thus created. This requires acknowledging to a virtuous
Formalisation 1980– 1982– 1984– 1986– 1988– 1990– 1992– 1994– 1996– 1998– 2000– 2002– 2004– 2006– 2008– the following underlying mismatches and mar-
81 83 85 87 89 91 93 95 97 99 01 03 05 07 09
circle in which
increases firms’ So why has more progress not been made in ket distortions that constrain creating jobs and
Note: The figure plots the ratio of real wages to the rental price of capital, for all industries and only labour-intensive sectors in dealing with India’s skills and jobs challenge? skilling the workforce: good jobs can
incentives
organised Indian manufacturing. The combination of inadequately skilled work- • The broken link between industry and the lead to better
to invest in Source: Sen and Das 2014. ers, out-of-date labour laws, the rising ratio of education and training systems.
wages to the cost of capital and persistent infor- • Inefficient or missing markets for skills. skilled workers
upskilling their
Conceptually the answer is clear: free up Geographic differences mality are feeding on each other and result- • The lack of on-the-job-training, especially in who can be
workers and informal workers (many of them female), ing in a self-perpetuating vicious cycle whose smaller firms but also in many large firms.
employed
workers’ own skill them based on industry requirements Complicating these policy responses is India’s
and deploy them in a rapidly growing for- geographic and cultural diversity. Different in more and
incentives to mal sector. Efficiency is higher in the formal states will realise the demographic dividend at FIGURE 1.5 better jobs
remain skilled sector, costs are lower and profit margins are different times, with India’s peninsular states The vicious cycle of low skills and few good jobs—a low skilling trap
bigger, all translating into greater job-gener- peaking sooner than its hinterland states.21
ating potential. Formalisation increases firms’ The proportion of the workforce to be skilled
incentives to invest in upskilling their work- and to be reskilled is also unevenly distributed
ers. It also increases the workers’ own incen- across peninsular and hinterland states. And
tives to remain skilled, besides providing them the starting points vary across states— i n school
with better working conditions and health and infrastructure, student-teacher ratios, general Slower
social security benefits. and vocational education levels, school dropout growth
of good,
Putting this into practise and staying the rates and workforce participation in formal and formal jobs
course is surely one of the most important informal jobs and in industry and services.
and difficult policymaking and political econ- The more advanced peninsular states— such
omy challenges facing India (see figure 1.3). as Andhra Pradesh, Kerala, Maharashtra and Higher cost
Again, simply put, in these circumstances pol- Tamil Nadu—need policies for upskilling and of skilled Greater
workers workforce
icymakers need to consider a three-pronged reskilling those already in the prime working
relative to informality
approach. First, completely clear the central- ages 30–59 and for matching them with the capital costs
and state-level underbrush of policy distortions industries that are growing fast and undergo-
that are embedded in dysfunctional and out-of- ing structural and technological changes. They
date labour and industrial laws and regulations, must also of course cater to new workers enter-
many of them hangovers from India’s famous ing the workforce. And they need to anticipate
licence raj and from earlier colonial times. Also the skills needed later in this 21st century.
ensure that laws and regulations no longer The less advanced hinterland states — such More
Lower
poorly-skilled
impede converting informal to formal jobs. Sec- as Bihar, Chhattisgarh, Jharkhand and Uttar incentives to
and fewer
ond, promote public and private investments in Pradesh —need policies to ensure effective acquire or
well-skilled
impart skills
sectors identified as most promising in generat- absorption of new entrants (15–29) to the workers
ing jobs directly within that sector and indirect- labour force.22 The key in those states is skilling
ly across sectors. Third, skill the workforce, cov- the new entrants and setting sectoral priorities
ering both existing and new workers, to match that ensure young workers’ absorption in the
employers’ needs and promote formal jobs. workforce. This will not be easy. In Bihar the
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