Acute scarcity of skilled workers threatens Indian economy

June 1st, 2008 - 1:28 pm ICT by admin  

By Rajeev Ranjan Roy
New Delhi, June 1 (IANS) An acute shortage of skilled workers is posing a major threat to the Indian economy. The Planning Commission estimates that only 20 percent of the 12.8 million entering the work force annually get some formal training. The plan panel has assessed that in an economy growing at the rate of “over nine percent”, skill development poses major challenges. At the same time, it opens up “unprecedented doors of opportunity” if the process of skill enhancement is carried out in an integrated manner.

“Time is just running out. The task of skill development must be taken seriously,” Planning Commission Deputy Chairman Montek Singh Ahluwalia warned recently, adding that public-private partnership was needed to meet the requirement of skilled workers.

The Planning Commission has estimated that the ageing economy phenomenon would globally create “a skilled manpower shortage of about 46 million by 2020″. If India can get its skill development act right, it will have a skilled manpower surplus of around 47 million.

“India should have 500 million skilled technicians by 2022. The task is onerous, but not impossible. Persistent efforts are needed to build capacity with focus on the workers in unorganised sector,” says Harmit Sethi, Director, Skill Development, Confederation of Indian Industry (CII).

Skilled workers not only mean enhanced output but also increase their employability manifold. They can go overseas looking for jobs, as all of them may not get one in the country. Or they can be self-employed.

“The organised sector accommodates only 16 percent of the total work force while the rest is in unorganised sector. There are around 300 million workers in the unorganised sector. There is a need to transform them into an asset by enhancing their skills,” Sethi told IANS.

Agreed Sudha Pillai, secretary in the ministry of labour and employment.

“The government is making concerted efforts to develop skills among unorganised sector workers. The skill development initiative (SDI) scheme is a new strategic framework for skill development called modular employable skills (MES) framework,” said Pillai.

“SDI will cater to the requirements of school dropouts and unorganised sector workers in a big way. The ministry trained over 24,000 people under the scheme in 2007-08 against the target of 10,000,” she added.

Sethi said that the government and private sector were making adequate efforts to develop skills. He called for incentives or tax rebates for industry employing skilled manpower.

The government May 15 approved the setting up of a National Skill Development Corp (NSDC) to cater to the needs of skilled personnel of the private sector in different fields. A total of Rs.10 billion has been provided for the initiative. This will later go up to Rs.150 billion.

NSDC, created at the recommendation of the Planning Commission, will put special emphasis on nearly two dozen high-growth, high-employment sectors like automobile, heath care services, banking, organised retail, insurance, construction, pharmaceuticals, food processing, textile, media, entertainment and tourism.

The ministry of labour and employment spent Rs.10.9 billion on training and skill development in the last fiscal against Rs.1.01 billion in 2006-07. Around 400 industrial training institutes (ITIs) are being developed as centres of excellence in the country.

Apart from the ministry of labour and employment, the ministries of rural development and human resource development are set to contribute a lot towards skill development through vocational educational system, said an official in the plan panel.

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