India's Skilling Ecosystem: Challenges and Opportunities

Over the past decade, India has developed one of the largest skilling ecosystems globally, with the Pradhan Mantri Kaushal Vikas Yojana training approximately 1.40 crore candidates between 2015 and 2025. Despite these efforts, skilling has not become a preferred pathway for many young Indians due to uneven employability outcomes.

Challenges in the Skilling Ecosystem

• Wage Gains:
  • PLFS data indicates modest and inconsistent wage gains from vocational training.
  • Informal employment offers limited recognition for certified skills and little improvement in quality of life.
• Gross Enrolment Ratio (GER):
  • India's GER is currently at 28%, with a goal to increase it to 50% by 2035.
  • This requires integration of skilling into higher education.
• Formal Vocational Training:
  • Only about 4.1% of the workforce has received formal vocational training.
  • This is significantly lower than the 44% in OECD countries.
• Industry Participation:
  • High attrition and productivity losses prevail, yet industry participation in skilling is limited.
  • Most employers use internal training and private certifications over public ones.

Structural Failures and Solutions

• Sector Skill Councils (SSCs):
  • SSC's role in defining standards and ensuring employability has not been fully realized.
  • Fragmentation in responsibilities has led to a lack of accountability and trust.
  • Unlike higher education, SSC credentials have limited value compared to degrees or work experience.
• Industry-Led Certification Models:
  • Successful models from companies like AWS and Google highlight the importance of credibility and accountability.
  • SSCs need to adopt a similar approach to enhance efficacy.

Opportunities for Improvement

• National Apprenticeship Promotion Scheme (NAPS):
  • Expanding NAPS can improve job readiness by integrating skilling into the workplace.
• Industry Integration:
  • Initiatives like PM-SETU emphasize stronger industry ownership and accountability.
  • Embedding skills in degrees and making SSCs accountable for placement outcomes can transform the skilling ecosystem.

The evolution of India's skilling ecosystem from a fragmented intervention to a cornerstone of national economic empowerment is crucial. This shift is essential not just for creating jobs but also for enhancing the dignity of labor and leveraging India's demographic advantage for sustained growth.