Daily Current Affairs – 6th October, 2016

Daily Current Affairs – 6th October, 2016

Skilling India’s expanding workforce

India’s workforce is young and growing fast where it is estimated that 250 million people will enter the labour market by 2025. India banks hugely on its demography for healthy dividend. The moot question is if the India’s emerging workforce is ready for the challenge?

  • The IMF’s World Economic Outlook has mentioned that India is already among the fastest growing major economies in the world. It has projected GDP growth at 7-8% for the next two years.
  • India has been extremely competitive in terms of labour and production costs along with a successful culture of entrepreneurship.
  • The surge in foreign direct investment (FDI) in last few years has shown that investors share the IMF’s optimism. India’s young workforce only adds to the attraction.
  • However, if the workforce is managed poorly, it leads to straining the economy and lead to higher unemployment. If the workforce is managed well, a larger talent pool can contribute towards growth and development.

 

Young workforce is not guarantee to success

  • Mere presence of youth in India is not adequate for sustained economic growth.
  • The skills and employability of the 250 million young people joining the workforce over the next decade will be crucial.
  • Today, innovation and digitalization is driving global competition and exorbitant consumer expectations in this era of globalisation. Thus, goods and services will have to constantly evolve to remain relevant. Along with it, the skills required to deliver them will also have to be evolved.
  • It is estimated that 6 out of 10 young people entering the workforce by 2025 will be in professions that do not exist today.
  • Right now, India’s 50% of its population is still employed in farming. India Skills Report 2016 shows the stark reality that still only 5% of young people aged 20-24 have obtained vocational skills through a formal training system.
  • Even at higher-education level, despite rising number of graduates, many lack the soft skills required to succeed in business today, like problem solving and creative thinking.
  • As per Global Talent Competitiveness Index (GTCI), a study published annually by INSEAD, Human Capital Leadership Institute (HCLI) and Adecco Group, India ranked 90th among 109 countries which were ranked on their ability to grow, attract and retain talent.

How to improve the skill sets?

  • It has to be ensured that the 250 million young people should have the requisite skill set to start working over next decade.
  • Firstly, India has to invest more in talent development. It has to be started with formal higher education, where courses should align more closely with real world business needs, including more focus on soft skills.
  • Next, there should be greater emphasis on vocational training as it is beneficial as well. Government of India and industry should work together to develop apprenticeship models able to provide the employable skills markets require.
  • There are too few apprenticeship schemes in the world. Although in markets where they are prevalent, like Germany, they have proved hugely successful.
  • More importantly, education must not stop after school or university. Lifelong learning is essential.
  • Digital skills are next important education across the board as digitalization is increasingly present in every sphere of work.
  • Flexibility in work atmosphere is needed in this time period due to precarious nature of the global economy which is continuously changing and risky.
  • There should be balance between permanent and temporary labour to tackle periods of high or low demand. This is necessary for companies to survive.

Government has taken some steps to felicitate business practice in India. The result is that India has moved up 12 places in the World Bank’s ease of doing business measure. Flexibility is an important tool for competitiveness. The countries that rank highest in the Global Talent Competitiveness Index (GTCI) have flexible labour markets as well as excellent formal and vocational training.

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