Sunday, 22 January 2012

India Inc does not have unemployment problem but an 'UNEMPLOYABILITY'’ problem

We have an employability problem.
 On February 1, 2011, the Prime Minister appointed S Ramadorai, former chief of Tata Consultancy Services, as his advisor on skills development. With India’s average age expected to be around 29 years by the year 2020, it becomes imperative that India creates productive jobs for the youth.
The success of Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) lies in the fact that it has provided a cushion to withstand wage related shocks to the poor majority of India. With the MGNREGS providing the basic protection, the next challenge is to provide industry-employable skills to the MGNREGS beneficiaries that will boost their income levels.
One is constantly reminded by the corporate sector that India does not have an unemployment problem but an ‘unemployability’ problem, i.e., a lot of the workforce is unemployable due to lack of skills. This gap between demand for skilled labour and the available supply is already large and rising further. This gap needs to be bridged. The three main issues that need to be addressed to bridge this skills gap in India include training capacity, funding for training and urban migration.
To provide employable skills in large numbers there needs to be a manifold increase in the training capacity. The biggest bottleneck seems to be funding. The solution could be for the government to act as financiers for the needy and provide training vouchers that can be encashed at any of the training institutes. The third issue is of urban migration. If the government and private sector are able to create large pools of skilled workers, the private sector can then go to non-urban towns to set up businesses and provide local jobs. The finance minister had earlier announced the formation of the National Skills Development Corporation with a mandate to provide skills training to 50 crore people by the year 2022. Now, with the appointment of a person from the corporate sector to oversee skills development there is hope in achieving this target.
(Milind Deora - Member of Parliament. The article was written with inputs from Praveen
Chakravarty of Unique Identity Authority of India)
Source: Excerpts from Economic Times

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