Mismatch between India’s graduate aspirations and job availability

Context: The Gross Enrollment Ratio (GER) for higher education, which is the percentage of the population between the ages of 18-23 who are enrolled, is now 27 per cent.

Background

• There is a huge pool of unemployed university graduates with unfulfilled aspirations. This group of dissatisfied, disgruntled youth can lead to disastrous consequences for our society.

Key Points

• GER is the number of students enrolled in a given level of education, regardless of age, expressed as a percentage of the official school-age population corresponding to the same level of education.
• The enhanced enrollment of students from weak socio-economic backgrounds is primarily a result of the extension of reservations to OBCs and EWS. 
• In addition, the massive increase in the number of higher education institutions has led to an enlargement of the number of available seats. There are more than 45,000 universities and colleges in the country. 
• A majority of the students are aiming to get some kind of a government job post their degree. 
• And, this is where there is a huge mismatch between students’ aspirations and what they are likely to attain.

Key Concerns

Employment opportunities in the government have not increased proportionally and may, in fact, have decreased with increased contractualisation. 

• Even in the private sector, though the jobs have increased with economic growth, most of the jobs are contractual. 

Unemployment: One in every five Indian who graduate (or even better) is unemployed. It is almost as if the economy penalises you for getting educated.

• In comparison, those with graduation (or even higher degrees) face almost three-times the unemployment level.

Low paying jobs: The highest increase in jobs is at the lowest end, especially in the services sector — delivery boys for e-commerce or fast food for instance. 

• A student who has finished his college against all odds is not very keen to take up a job in a call centre or worse as a delivery agent for e-commerce or fast food.
• On the one hand, companies in India face an acute shortage of skilled manpower and, on the other, India has millions of educated unemployed.The industry always complains about the shortage of skilled labour in the country. 

Social unrest: There is a huge pool of unemployed university graduates with unfulfilled aspirations. This group of dissatisfied, disgruntled youth can lead to disastrous consequences for our society.

• Over 90% of India’s workforce is in the informal sector. India is trapped in a vicious cycle: Greater workforce informality leads to lower incentives to acquire new skills. 
• Faced with inadequately skilled workers, businesses often choose replacing labour with machinery. 
• That’s because “skilled labour and technology are complementary, but unskilled labour and technology are substitutes”. This, in turn, leads to still fewer formal jobs.
• Millions of Indians who work in agriculture continue to subsist because they do not have the skills to take up industrial or services sector jobs even as these sectors themselves have failed to create adequate job opportunities.

Poor quality of ITIs: Industrial Training Institutes (ITI) and Industrial Training Centers (ITC) are post-secondary schools in India constituted under Directorate General of Training (DGT), Ministry of Skill Development and Entrepreneurship, Union Government to provide training in various trades.

• There are more than 15,000 Industrial Training Institutes (ITIs) in the country currently. 
• These institutions provide training in various trades like air conditioning mechanic, electrician, mechanic etc. 
• The quality of these of course is very uneven. 
• They are also, by and large, poorly maintained and lacking in resources, both physical and human. 
• The curriculum remains outdated and has not been upgraded to include some of the newer skills like maintaining networking and telecom equipment.
• There is a huge competition for admission into these institutions, and polytechnics. 
• In some places, it is harder to get into these than to get admission to the local government college.
• Manufacturing units prefer hiring them for blue-collar jobs since they at least have the least training. 
• In addition, the pass-outs from ITIs also have the option of being self-employed in the various service-related sectors.
• A distinct disadvantage with India’s approach towards skilling has been to ignore the demands of the market. For the most part, skills have been provided in a top down fashion. Thus, most skilling efforts focus almost solely on providing certain skills but fail to “match” them with the needs of the market.

Road Ahead

• A concurrent increase in the number of high-quality vocational institutions can be done. 
• Upgrading the existing ITIs, opening many more new ones with high-quality infrastructure and updated curriculum is something which should be done urgently. 
• There is a scheme to upgrade some ITIs to model ITIs. However, what is required is not a selective approach but a more broad-based one that uplifts the standards of all of them besides adding many more new ones. 
• Industry may provide funding (via the CSR route) as well as equipment, training for the faculty and internships for students. 
• And surely, if the government can spend thousands of crores on existing and hypothetical Institutes of Eminence, funds should not be an issue for this exercise which, coupled with our demographic dividend can be a boon for the economy and the society.