Abstract
India which is moving through ‘demographic dividend’ and wants to achieve tag of ‘knowledge based economy’ need to invest in skill formation and developing educated and skilled workforce. This article will begin by broad overview of education and critical evaluation of current skill development policies at school and vocational level. There would be a brief discussion on role played by private sector in training of workforce in India and what are challenges faced by employers and employees and where lies the conflict of interest. After that in concluding section the major problems will be combined together to come out with the broad basic reason for the failure of such policies and conclude by scrutinizing what can be done in future to bridge the gap between educated and employed. Policy approach to skill development is supply driven and less attention is paid to demand side factors. Study recommends creating national training funds which can be used to collect levies from organized and large firms to be used for skill development of the informal sector. Levy based financing can help in solving problem of free rider and moral hazard as is held by the private sector. Study also recommends making vocational education compulsory from 8th standard and bridging the wide gap that exists in Indian labor market between ‘educated’ and ‘employable’.
Highlights
Overview of Skill Development System of India: For India, which is moving through ‘demographic dividend’ and wants to achieve tag of ‘knowledge based economy’, it becomes all the more important to invest in improving skills and invest in technologies complementing the respective skills suitable for emerging economic environment
Skill Development is the answer to the problems of India but according to UN in India less than one tenth of labor force has any vocational training (This includes both formal as well as informal training) (ILER, 2014)
There would be a brief discussion on role played by private sector in training of workforce in India and what are challenges faced by employers and employees and where lies the conflict of interest
Summary
Overview of Skill Development System of India: For India, which is moving through ‘demographic dividend’ and wants to achieve tag of ‘knowledge based economy’, it becomes all the more important to invest in improving skills and invest in technologies complementing the respective skills suitable for emerging economic environment. Skill Development is the answer to the problems of India but according to UN in India less than one tenth of labor force has any vocational training (This includes both formal as well as informal training) (ILER, 2014). In countries like Korea, Japan, Germany, around 85% of workforce in the age group of 18-25 have received some form of vocational training and the same figure in case of India drops down to 5% (Planning commission, 2008) Reasons cited for this are lack of monetary investment but in reality from past many years Union budget have allocated ample resources for production of skilled workforce but the problem has been the inefficient utilization of those resources. After that in concluding section the major problems will be combined together to come out with the broad basic reason for the failure of such policies and conclude by scrutinizing what can be done in future to bridge the gap between educated and employed
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