We can become a value-creating economy only if we develop a more targeted and coherent approach driven by innovation.
There is a vision that we all share of transforming India into a robust, development-oriented economy which is capable of achieving, maintaining and sustaining high levels of growth over the next decade. One of the critical factors in achieving this is ‘Employability’, that is looking at how we can make a growing young demography more employable.
The coming decade will be crucial for India and only if India grows at the rate of 8-9% per annum, India’s per capita GDP will grow from the current level of $1,800 to $8,000-$10,000 by 2025. The growth matrix for the next 10-20 years will be very different – and far more challenging and complex than what we have witnessed. Clearly, jobs and productivity must be the pivots for social and economic framework in the coming years.
The country’s advantage lies in its young population and a dynamic and rapidly growing consumer base. India’s demographic dividend can be realised fully by imparting our youth with appropriate skills. In fact, to improve the effectiveness and contribution of labour, a National Skill Development Mission has been constituted which envisions creating 500 million skilled people resource by 2022. A National Skill Development Agency has been set up to coordinate skill development efforts across various Ministries and State Governments. A National Skills Qualification Framework is also on the anvil.
Jobs and productivity must be the pivots for social and economic framework
India today ranks 6th amongst the world’s 10 largest manufacturing countries. The sector which contributes 16% to the GDP currently has a potential to account for almost 25% of the GDP and create up to 95 million jobs by 2025. The opportunities for employment are aplenty and we need a holistic action plan that covers every base — one that includes a skilling and re-skilling programme to increase employability and productivity, incentives for smaller enterprises to absorb a greater number of workers.
Growing the economy, creating jobs, focusing on skills
Nearly 17.6 million people will be queuing up for jobs in 2017 alone
We have grown by leaps and bounds in the decades since independence. However, our growth in the coming decades will be far more complex, as the economy matures and enters a new phase – one which is marked by sustainable growth – driven by expertise, innovation and socio-economic development. The rules of the game will change and so has our task of Transforming India. The nation is surging ahead as a manufacturing destination. Growth in exports are looking up. The economic scenario has brightened. All of these are pointers to the fact that the next few years will be crucial for India’s growth and progress. As the economy grows, so will the demand for jobs. As per ILO forecasts, nearly 17.6 million people will be queuing up for jobs in 2017 alone. The questions looming large are: How do we create jobs to meet the rising demand? Secondly, how many of this prospective workforce are really employable? A recently conducted employability-focused study based on 150,000 engineering students, found barely 7% suitable for core engineering jobs. Employability therefore, will be a crucial factor if we are to address the issue of creating a skilled and productive workforce for India in the coming decades.
This article is a part of FICCI publication “Economy of Jobs” that was released during our 89th AGM in December 2016. It presents essays from India’s leading business leaders and eminent thought leaders who share views and suggestions on job creation. The articles cover varied issues: demographics, education, skill development, entrepreneurship, impact of technology, labour laws, and as well as specific issues across sectors.
More articles from this series can be viewed here at: Economy of Jobs
A lot of work is already underway to step up the momentum and get the economy on the growth path. The National Institution for Transforming India (NITI Aayog), has enlisted Government’s support for manufacturing sectors with large-scale employment generation opportunities, which also have export potential. Such support would prove extremely beneficial in boosting the manufacturing sector, exports and employment generation as well. Several measures are also being undertaken to create an enabling environment to create a spotlight for India as a manufacturing destination. With all these efforts, exports are expected to touch nearly US$ 280 billion in 2016. India’s businesses can remain competitive only when they have the trained and educated workers they need. We must strengthen our education and skills-training programmes to make sure our workers are getting the requisite training they need, and we ought to ensure that all those we train in high-demand skills have an opportunity to find work and contribute to our economy. The push should be to develop a mastery of skills and investing in high-skilled teams in every sector.
A more targeted and coherent approach towards a value-creating economy
I believe that we can become a value-creating economy only if we develop a more targeted and coherent approach driven by innovation. This is the outlook we need to have as we embark on a new phase in our nation’s economic development, one where we need to look beyond value-adding to value-creation. This is a huge shift in our focus which calls for making innovation more purposeful and pervasive. This push for value creation must resonate in every industry – small, medium and large – in a way that it becomes a competitive edge. It is about developing a “more targeted and coherent” approach – it is about coming up with new products, technology and services that will give them the advantage to carve out a niche in the global market.
Pankaj Patel, President, FICCI (2017) and Chairman & Managing Director, Zydus Cadila writes this piece for FICCI publication “Economy of Jobs”. Post continues on Page 2.