February 1, 2013 2:53 pm

Skills deficit holds India back

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In a working-class neighbourhood of Mumbai, India’s financial capital, Sushma Kamble is single-handedly raising her nine-year-old daughter on the Rs4,000 ($74) per month salary she earns cleaning a nearby police compound.

Mrs Kamble, whose husband left her, has many worries, including money. But one of her biggest concerns is the poor quality of education at the nearby government school her daughter attends. To make up for that, Mrs Kamble is spending Rs230 a month for her daughter to go to a privately run after-school enrichment programme every day.

“They don’t teach properly in the school,” she says. “They [the teachers] come for two days, then they don’t come for two days. They don’t take seriously whether [the children] learn or not, and the children are just passed automatically.”

Worries about how well Indian government schools teach the young are not limited to poor and working class parents. With more than 300m young people due to enter the workforce over the next two decades, economists warn that India’s failure to properly educate and train its children and youth for the job market threatens to become a significant drag on economic growth.

“We won’t get the growth kick that we could have,” according to Laveesh Bhandari, founder and director of Indicus Analytics, an economics research company. “The bulk of these youths are going to be involved in services that are low skill, low value and low returns.”

New Delhi’s policy makers frequently cite the rapid growth in the number of India’s young people as an asset that will help propel accelerated economic growth in the years ahead. India has a much younger population than its Asian rival, China, where after decades of a strictly enforced one-child policy, the labour market is tightening and the total workforce is due to start contracting from 2016.

India’s labour force, by contrast, is growing rapidly, with entrants to the job market expected to increase annually for the next decade or more. But presently many young Indians hitting the job market are unemployable. Out of the 12.8m joining the workforce every year, only 8 or 9 per cent have any skills, while many can barely read having left school at 13.

“The demographic dividend is not just people, it is productive people,” says Maneesh Sabharwal, chief executive of TeamLease, India’s largest human resources company.

Companies regularly complain about the difficulties of finding workers who are either already trained or easily trainable. That gap – between the needs of fast-growing Indian companies and the workers available – is projected to grow in the years ahead.

Two years ago, the ICRA Management Consulting Service, a subsidiary of ICRA, the domestic credit rating agency, estimated that India would face a potential shortage of up to 250m trained workers in information technology, IT-enabled services, retail, healthcare, construction and other fast-growing sectors by 2022.

“The majority of companies are finding it difficult to get workers across the employment chain,” says Dilip Chenoy, managing director of the National Skills Development Corporation, part of the government’s answer to the problem.

The NSDC was formed in 2009 by the Indian finance ministry and industry groups to address the weakness, and small size, of India’s vocational education system, and to spur private investment in new, financially sustainable, privately run skills training programmes. Through the financial support it extends to entrepreneurs and companies, the NSDC has a target of facilitating the training of 150m people in relevant skills by 2022.

But the root of India’s employability crisis goes deeper than just a shortage of relevant vocational education opportunities. It lies in the weakness of its basic education system. “If you have good primary education, skilling is a three-to-six-month affair for most jobs,” says Mr Bhandari. “But if your primary education is not good enough, even skilling becomes difficult.”

Over the past decade, India has had significant success in pushing up its once-low school enrolment rates. These have risen to around 96 per cent in rural areas, where about 70 per cent of Indians still live.

But most rural schools are little more than a classroom or two, with one or two teachers responsible for large numbers of first-generation learners of different ages, at different abilities and with different skill levels.

In these circumstances – and without any family support at home – many students struggle to learn even the basics.

The Annual Status of Education report, published by Pratham, a respected education foundation, highlights the poor learning outcomes in such rural classrooms. According to the survey, fewer than half of the children in class five – about 10 years old – are able to read text to the standard expected of a seven-year-old. Basic arithmetic levels are also dire, with just 60 per cent of 10-year-olds able to do basic subtraction.

Many international and Indian foundations are trying to tackle the challenge of strengthening primary education, while the government, too, insists education is a priority.

Mr Sabharwal says the outcome of these efforts to bolster schooling are critical for the country’s economic future .“What India does in the next five to 10 years in health, education and skills will decide whether we get stuck in the middle-income trap, or whether we will break through into a high-income nation,” he says.

“If the education system gave people the fundamentals, the three Rs – reading, writing and arithmetic – then employers can pitch in and give the last-mile skills.

“But we can’t teach somebody to be creative, confident, a risk taker and a team player. That’s got to happen in the 12 years of school.”

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