In a bid to scale up the number of skilled workers, the Budget has declared a reward of Rs10,000 for every person who passes the training programmes formulated by National Skill Development Corporation (NSDC). However, going by the look of it, nobody seems to be enthusiastic enough either for monetary benefit or to acquire skill. Judging by the present scenario, the target of generating 500 million skilled workers over the next decade to propel economic growth does seem a bit far-fetched.
According to labour experts, rising wages in rural India and MGNREGA has dissuaded people from flocking to urban areas for work. This has definitely, resulted in a shortage of skilled labour. At the same time, the industry is also reluctant to shell out a premium for trained workers, making the case for acquiring skills quite weak.
The reason why industry does not want to pay more is that it has a large pool of unskilled workers who can be paid less and can gradually learn the skill on the job. A problem area with hiring of skilled labour is that the workers expect high wages the moment they are out of the institute into the industry. labour experts point out that this is where the Apprentice Act can be tweaked into making it a win-win situation both for the skilled workers and the industry.
Taking a leaf from countries like Germany , where 75 per cent of all people under 22 have served as apprentice, despite formal training gives the industry the flexibility to hire trained workers who can reach salaries of a full-time worker in a gradual manner. However, in India , it is a different story, where apprentice laws are rigid and obsolete, and work against the interest of the worker and the industry.
In fact, the burgeoning youth in our country have the energy but not the requisite skills that India ’s organised sector demands. According to the Economic Survey, a major issue is that industry is creating relatively low-productivity jobs. As a result, per capita income in India has not gained much from migration of workers from farming into other sectors.
On the other hand, services sector, which is a high-productivity sector, has been unable to create jobs in keeping with its growth rate. According to a survey, most of the employment in India comes from the informal, unorganised medium and small enterprises sector. Experts say that largest driver of growth – the construction sector, is the biggest job driver. But again, this is an informal job creator with no social benefits as bonus.
What policymakers need to take notice of is that our economy is adding “informal” jobs in the formal sectors with little increase in productivity. And with today’s youth’s mind-set, a low-productivity job without the icing of social security is hardly an incentive to opt for skill development.