By Dr Moin Qazi
Dr Moin Qazi is a PhD in English and Economics.
Although India’s huge demographic dividend is considered to be one of her strengths, our optimism needs to be moderated. If the youth are not skilled and face unemployment challenges, it might turn out to be a liability rather than an asset. The skill development programmes and their allied industries should develop the capability to cross-train the youth and build a culture of learning.
Lack of ‘right’ skills for the job
Employment is a global problem, with more than 73 million youth unemployed worldwide. In India, the unemployment rate in this section is almost 13% (compared to 4.9% overall). Underemployment is even higher. Given the kind of opportunities available in the country, it is disheartening to note these dismal figures. The missing link here is skill development which is the key ingredient to robust economic growth.
Young people desperately search for entry-level jobs while employers, ironically, are unable to find people with the right skills. They face regular attrition and a monthly turnover sometimes as high as a fifth of their workforce. At the same time, 40 percent of employers blame skill shortage for entry-level vacancies. The imperative for skilling young people is well-recognised and has been flagged as a national priority for almost a decade, with significant initiatives being launched by the government. Only 10 percent of the total workforce in the country receives some kind of skill training.
Benefits of a skilled workforce
According to the National Skill Development Corporation (NSDC), a public-private partnership set up by the erstwhile Planning Commission with a mandate of providing funding and direction to private skill development programmes, the growing skill gap in India is estimated to be more than 250 million workers across various sectors by 2022.
The benefits of skill development have been clearly articulated by the government and the industry with regards to addressing the nation’s unemployment problem and creating jobs. Skill development will help prospective employees get easier access to the formal job market where they can bargain for higher incomes, work under more congenial labour conditions, avail greater job security, better health care and medical facilities. Considering the fact that the academic curriculum is more or less similar across universities and colleges, graduates from tier 2 and 3 towns typically lose out due to lack of exposure and soft skills in the race for employment.
The private sector on the other hand, by deploying its CSR capital on skill development projects, also stands to benefit enormously from the availability of a large skilled and disciplined workforce. This can parlay into better levels of customer service, increased productivity and efficiency, reduced absenteeism and employee turnover, along with lower recruitment costs.
Towards a bright future
The results of several programmes have, however, been mixed. Programmes have reported high dropout rates, low employment percentages and continued attrition post-placement, leading to dissatisfied employers as well as frustrated youth. Providing ‘skill-training and certification’ alone cannot be a solution to the problem. There is clearly a case for going back to the drawing board.
In the above backdrop, the two NGOs, Generation India Foundation, founded by globally renowned management consultants, McKinsey and Co. and United Way India have joined forces to launch a new skilling initiative called ‘Generation United’. Generation India Foundation is a youth employment non-profit with a dual mission to empower young people to build thriving and sustainable careers and to provide employers with highly skilled and motivated talent they need.
It aims to develop a sustainable youth employment model and catalyze change in the skill development sector. In just three years of global operations, it has expanded to 21 professions in 60+ cities across five countries—India, Kenya, Mexico, Spain and the USA—with its 15,000+ graduates making it the largest demand-driven employment program in the world.
Perspective matters
In 2015, McKinsey Social Initiative (MSI), a global independent non-profit, launched a programme that aims to do exactly this. Founded and partly funded by McKinsey & Company, MSI is also supported by USAID and other corporate partners. Generation United’s experience with the project illustrates that to be successful, skilling needs to be much more than training—it needs work on every link of the employment chain—from sourcing (of candidates) right up to post-placement mentoring, supported by measurement at every step. The change in approach improved Generation’s outcomes immensely. Over 97% of graduates have found jobs and an employment rate of 73% which is significantly higher than the placement rates of ~40% in alternate skilling programs.
Generation’s experience offers useful lessons on establishing the business case for skilling. Four lessons stand out, which—in their view—redefine the economics of skilling. First, they noticed that investment for skilling needs to be comprehensive—covering not only the training itself but also screening, matching and mentoring. Second, programmes need to have measurable outcomes for the person seeking a job; that will encourage other young people to get involved. Third, Generation has established a close link between skilling and business profitability that should convince employers that they have a lot to gain from employing skilled people. Finally, they should shift how to measure the efficacy of skilling from cost (and occasionally placement rates) to a broader metric measuring return on investment for society.
It doesn’t require a genius to change the storyline. A lot of good programmes got their start when one individual looked at a familiar landscape in a fresh way. These creative and passionate individuals saw possibilities where others saw only hopelessness. They imagined a way forward when others saw a dead end. What they did was to simply change the fundamental approach to solving problems, and the outcomes have been truly revolutionary.
Featured Image Source: Visual Hunt
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