India s Skills Challenge First Principles, Priorities and Responses

Transcription

1 India s Skills Challenge First Principles, Priorities and Responses Presentation for NCAER ADBI PRI Tokyo Dialogue, Dr K.P Krishnan Secretary, Ministry of Skill Development and Entrepreneurship

2 The Skills Challenge Supply side 24 million youth enter the 15+ age group every year 47% of children drop out at secondary school level Hence ~10-12 million youth enter the workforce every year Annual training capacity : 2.5 million Demand side India: estimated incremental skilled manpower requirement in 24 high growth sectors, until 2022 : 103 million Globally: net workforce shortfall is million by 2020 (due to low birth rate and ageing population) Large young population; Limited training capacity Significant industry demand for skilled workers India and globally Slide 2

3 Is there a market for skills in India? What does this market look like? 3

4 The Market for Skills : A Public Economics View Skill Development Merit good not public good Large divergence between social and private costs/benefits Market Failure Case for state intervention, through state provision State provision not necessarily state production Strong case for state funding and private sector production Slide 4

5 How has India s skills landscape evolved? 5

6 Long-Term Training Landscape Formal Indian VET : ITI system (1950s) HR obverse of II five year plan industrialization & engineering PSUs Now 13,351 NCVT affiliated ITIs in India 84% private & 16% government Average government ITI Large tracts of land Good building Poor quality labs/equipment 50% + teacher vacancies, balance formally qualified, well paid, low motivation Average private ITI not likely to be better 6

7 Short-Term Training Landscape MES launched by MoLE ~ Rs.10 billion spent on the scheme 13,729 private sector skill development providers 455 private sector assessment & certification agencies NSDC launched About accredited TPs 40 Sector skill councils handle assessment & certification ~1 crore youth trained, assessed & certified 7

8 What explains these outcomes? 8

9 Public Economics & Skill Development State funding with private production calls for different role of state Ensuring value for public expenditure Two factors of skill development Target population likely to be vulnerable Potential for collusive behavior Training quality ensured through Contracting or regulation Indian model was a hybrid NCVT without regulatory power Poor contracting & enforcement capacity of DGT & State Governments Sub-Optimal Outcomes 9

10 Skill India Agenda Increase scale Enhance quality and employability Make skills aspirational Focus on informal sector and self employment 10

11 What has been achieved in each of these areas? 11

12 Scale: Increase in Capacity Long Term Skilling Students enrolled Seating Capacity Short Term Skilling Candidates Trained * Fee based PMKVY Figures in lakhs Figures in lakhs 1381 new ITIs established across India PPP model to cover the uncovered blocks Comprehensive apprenticeship reforms undertaken NAPS : Increase in no of apprentices from 1.13 lakh in 2016 to 6.4 lakh in Figures in lakhs 143 % increase in NSDC training centers 600 PMKKs (model skill centers) being promoted across India 5,700 centers accredited and affiliated under PMKVY Slide 12

13 Quality: Standards and Industry Connect Course standardisation 1,911 QPs and 5,000+ NOS developed and validated by companies All central government scheme NSQF aligned SSDMs and States adopting NSQF for skilling programs 11 state core committees for NSQF alignment Course modernisation 63 course curricula upgraded with industry consultations 35 new trades introduced such as Renewables, Mechatronics, Instrumentation Industry connect Establishment of Institute Management Committees (IMCs) in 1,227 ITIs German model of dual training with industry introduced on pilot basis 80 short term training courses linked to apprenticeship (pilot launched) 37 corporates contributed over Rs. 100 Cr in CSR to NSDF ( )

14 Aspiration: Why is Skill Training not an Aspirational Choice? Low signalling value of skills training, leads to low skill wage premium The market for skilled workers similar to Akerlof s market for lemons Low skills premium persists in India What is being done? Advocacy and Outreach (kaushal melas/exhibitions/graduation ceremony/skills competitions) Progression Pathways Improving international mobility and overseas employment opportunities

15 Aspiration : Progression Pathways School dropouts (47% * ) Short term training 8 th /10 th standard pass ITI Job market Polytechnic CBSE NIOS Higher education Operationalized Under implementation 47 %* drop out by higher secondary level Slide 15

16 International Partnerships Enhanced quality Innovative partnerships to establish centers of excellence in key sectors Enhancing quality and processes of existing training institutes (CSTARI) Germany, UK, France, Japan, Switzerland, China, Singapore International acceptance 82 Indian Qualifications aligned with UK standards, through SSC partners. Capacity building of trainers & assessor UK, Germany, Australia, Canada Global mobility Focus: Mutual recognition of qualifications Partnership with MEA on PKVY. Focus: PDoT and cultural orientation for Indians migrating overseas. UAE, Japan, Qatar India International Skill Centers : 14 IISCs operational - Target of 100 IISCs in 2018 Slide 16

17 Enhancing Employability through Entrepreneurship Integration of Entrepreneurship in Skills Training Common Norms define employment as both wage and self employment. Entrepreneurship orientation module integrated in PMKVY 2.0 Disaggregated data on wage and self employment in PMKVY 2 Role of MSDE : Catalyse Shift from Informal to Formal Sector Build a national system for mentorship, to facilitate transition from informal to formal sectors Evolve design, process, systems and policies that facilitate effective mentorship for aspiring entrepreneurs Slide 17

18 Skill Development : The Way Forward Increase scale Numbers, disciplines & location Role of state-lmis Enhance quality & employability Statutory regulation for quality assurance Industry connect for employability Skills as aspirational Skill wage premium Education pathways Participation in global skills market 18

19 Districts with low capacity utilisation and high density Policy response: Focus on quality Districts with medium capacity utilization and low density Policy response: Focus on scale and quality 19