Employability

Issues and Impact

SPEAKER:
Venkat Matoory | Executive Director | JA India
http://india.ja.org

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 Talent shortage in India
You probably know this already?

500,000
Suitable graduates needed by 2010
(IT-BPO sector)

1 Million
Manpower required in Retail in 2008
Source: McKinsey report & Business Line

2
How many graduates does India generate p.a.?

1,000,000?
Or even more!

3
 Unemployment! A simmering problem
Opportunity generation needs to be wider and deeper

16.00
16.00
14.00
14.00 1
12.00
12.00
# of heads (Mn)
# of heads (Mn)

10.00
10.00 2
8.00
8.00
6.00
6.00 3
4.00
4.00
2.00 4
2.00
-
-
Crossing 16 yrs VII 1997 - 98 X 2000 - 01 XII 2002 - 03 Graduates 2003 Organized
Crossing 16 yrs VII 1997 - 98 X 2000 - 01 XII 2002 - 03 Graduates 2003 Organized
- 04 Employment
- 04 Employment
Source: Secondary research

Estimated enrollments per year

10% growth perhaps enough but what about the growth model?
Need more jobs but who will create them?

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In a country of 1.1 billion people

Talent shortage?

5
 Should we be concerned?
Does this impact our nation and its citizens?

GDP ($ Bn)
Relative per capita economic output

Country Population (Mn)

@ PPP for Non US Nations

1200% USA 301 13,130 (Base)

875% UK 60 1,930 (2,346)
(Vs India)

210% China 1,321 10,170 (2,518)

India 1,129 4,156 (804)
900% Japan 127 4,218 (4,883)
850% Singapore 4.5 141(122)
370% Saudi Arabia 27 366 (270)
%

800% Israel 6 170 (140)

India:
India:AAvery
verytalented
talentedworkforce
workforceyet
yetother
othernations’
nations’workforce
workforcegenerating
generatingmore!
more!
How
Howdo
dowe
we get
get affected
affectedtherefore?
therefore?

6
UNEMPLOYABILITY and UNEMPLOYMENT
Urgent crisis and current interventions are not delivering

•• Unviable
UnviableAgriculture;
Agriculture;
–– 96%
96%ofoffarm
farmhouseholds
householdshave
haveless
lessthan
than22hectares.
hectares.
–– 70%
70%ofofour
ourpopulation
populationand
and56%
56%ofofour
ourworkforce
workforceproduce
produce18%
18%ofofGDP
GDP
•• Demographics;
Demographics;300
300million
millionyouth
youthwill
willenter
enterthe
theLabour
Labourforce
forceby
by2025.
2025.
–– 25%
25%ofofthe
theworld's
world'sworkers
workersininthe
thenext
nextfour
fouryears
yearswill
willbe
beIndian
Indian
•• Our
Our50%
50%self-employment
self-employmentdoes
doesnot
notreflect
reflectentrepreneurship
entrepreneurshipbut
butour
ourfailure
failuretotocreate
create
nonfarm
nonfarmjobs
jobsand
andskills
skills
•• The
Theskill
skilldeficit
deficithurts
hurtsmore
morethan
thaninfrastructure
infrastructuredeficit:
deficit:
–– ItItsabotages
sabotagesequality
equalityof
ofopportunity
opportunityand
andamplifies
amplifiesinequality
inequality
–– While
Whilepoor
poorinfrastructure
infrastructuremaintains
maintainsinequality
inequality(it(ithits
hitsrich
richand
andpoor
poorequally)
equally)
•• The
Theincreasing
increasingreturns
returnstotoskills
skillsand
andskill
skilldeficit
deficitare
arereflected
reflectedininthe
the10%
10%increase
increaseinin
inequality
inequality(Gini
(Ginicoefficient)
coefficient)since
since1994
1994

Source: The India Labour Report 2007: The Youth Unemployability Crisis – By TeamLease Services
UNEMPLOYABILITY: A bigger crisis than UNEMPLOYMENT

•• 57%
57%of
ofIndia's
India'syouth
youthsuffer
suffersome
somedegree
degreeof
ofunemployability
unemployability
•• While
Whileonly
only8%
8%of
ofyouth
youthare
areunemployed
unemployed
–– 53%
53%ofofemployed
employedyouth
youthsuffer
suffersome
somedegree
degreeofofskill
skilldeprivation
deprivation

•• The
The82.5
82.5million
millionunemployable
unemployableyouth
youthfall
fallininthree
threeskill
skillrepair
repairbuckets:
buckets:
•• Last
Lastmile
milerepair
repair(<
(<0.5
0.5yrs)
yrs) : : 5.3
5.3million
million
•• Interventional
Interventionalrepair
repair(0.5-1
(0.5-1yr)
yr) :21.9
:21.9million
million
•• Structural
Structuralrepair
repair(1-2
(1-2yrs)
yrs) :55.4
:55.4million
million

Source: The India Labour Report 2007: The Youth Unemployability Crisis – By TeamLease Services
 Is our human resource

Constraining economic
growth?

9
The Demand Supply mismatch

•• 90%
90%of
ofemployment
employmentopportunities
opportunitiesrequire
requirevocational
vocationalskills
skills
–– But
But90%
90%ofofour
ourcollege
college/ /school
schooloutput
outputhas
hasbookish
bookishknowledge
knowledge
•• High
Highdrop
dropout
outrates
rates(57%
(57%by
byGrade
Grade8)
8)are
areincentivized
incentivizedby
bythe
thelow
low
returns
returnsof
ofeducation;
education;
–– 75%
75%ofofschool
schoolfinishers
finishersmake
makeless
lessthan
thanRs
Rs50,000
50,000per
peryear
year
•• Poor
Poorquality
qualityof
ofskills
skills//education
educationshow
showup
upininlow
lowincomes
incomesrather
ratherthan
than
unemployment;
unemployment;
–– 58%
58%ofofgraduates
graduatesmakes
makesless
lessthan
thanRs
Rs75,000
75,000per
peryear
year

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Source: The India Labour Report 2007: The Youth Unemployability Crisis – By TeamLease Services
 Is there a need for us to relook at how we prepare
our future work force?

Do
Dostudents
studentsunderstand
understandthe
theworking
workingworld?
world?And
Andthe
theways
waystotoengage
engagewith
withthe
the
working
workingworld?
world?

Do
Dothey
theyunderstand
understandhow
howeconomic,
economic,social
socialand
andbusiness
businessenvironment
environmentare
areimpacted
impacted
by
bywork?
work?

Do
Dothey
theyunderstand
understandthe
therole
roleofofthe
theindividual,
individual,their
theireducation
educationand
andspecific
specificabilities
abilitiesfor
for
succeeding
succeedingininthethereal
realworld?
world?

Are
Are they
they prepared
prepared for
for the
the real
real world?
world?

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Thank You!

JUNIOR ACHIEVEMENT INDIA SERVICES

(A Company registered under Section 25(1)(a) of the Companies Act, 1956)

http://india.ja.org

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