A quality apprenticeship ecosystem based on robust dialogue and public-private partnership can increase the employability odds for young Indians and help address acute talent shortages across industry sectors.
In the latest American Staffing Association Workforce Monitor survey (2018) of over 2,000 American adults, an overwhelming 62% of respondents agreed that apprenticeships increase the employability quotient compared to going to college alone.
What is Employability
The WEST-Wheebox Employability Skill Test looked at how well a young person measured up against jobs available in the market. The premise of the test was previous research that stated knowledge, skills, aptitude and behavioural components were key components for a job. Other parameters that the test measured were learning agility, interpersonal skills, adaptability, conflict resolution, emotional intelligence and self-determination as vital elements from the demand side of the talent supply chain. These desirable skills were extrapolated from 125+ employers across eleven major Indian industry sectors.
Source: India Skills Report 2017, Wheebox, People Strong, AICTE, CII
It should not come as a surprise that a formal education alone is unable to provide experiential skill sets and why millions of graduates every year in India are unemployable even after the rigour of a purely academic system. An apprenticeship or on-the-job training on the other hand is a much more immersive all round experience. An apprentice would go through an in-depth programme of technical skilling and life skills as they work in the real world within the premises of an organisation. A highly specialised individual comes out at the end of the training period who is also well versed with the ethos and business objectives of the company. This individual is the perfect fit for the business and absorbing them as a full-time employee is almost a no-brainer. A skilled in-house apprentice is possibly the best recruit for an organisation.
The Skill Problem in India
The facts speak for themselves. An estimated 3.5 lakh engineers and 2.5 million university graduates are churned out of India’s higher education system each year, with an estimated 5 million graduates out of work at any given point. Dropout rate from formal education peaks at the secondary level (class IX-X at 17%, as compared to 4% in elementary school (class I-VIII) and 2% in upper secondary school (class XI-XII). According to the Annual Skill Report 2016-17 a dismal 4.69% of India’s workforce has formal vocational skills, as against 60%- 90% in developed countries. Moreover, A FICCI-Ernst & Young (2012) report on skill development had forecast 50–70 million new jobs up to 2017-18, of which 75%–90% would require some form of TVET education.
A Case of Absolute Decline
According to a report published on September 25th 2018 by the Centre for Sustainable Employment (CSE), an off-shoot of the Azim Premji University, India lost 7 million jobs over three years to 2015 and the “absolute decline” has continued past 2015. The report supports the line of thought that economic growth in India has not translated into growth in job numbers. “Even as GDP growth rates have risen, the relationship between growth and employment generation has become weaker over time,” the report said. It further expanded that a 6.8% GDP growth rate over five years to 2015 saw less than 1% increase in employment at 0.6%.
The Young and the Educated Are Worse Off
The report further reveals that unemployment in India is currently over 5% and paradoxically is the highest- around 16%, among youth and those with higher education. This is because skills of youth even with a higher degree are misaligned with demands from industry. We feel this is quite a disturbing predicament if years of schooling and education are not able to equip India’s youth with the right skills to be job ready. It is a disservice to both youth and industry. In light of such circumstances if the country were to adopt a robust large-scale industrial and corporate apprenticeship program the value add would be enormous in youth gaining employable skills.
Where Do Youth Go from Here
Several cross-country comparative studies have shown apprenticeships, vocational education and competency-based training as key to adapting to changes in the labour market by skilling, upskilling or re-skilling existing capabilities.
In 2014, ILO Director-General Guy Ryder, describing quality apprenticeships as the “gold standard” to get youth into decent jobs said, “Countries where apprenticeship systems are strong, youth unemployment rates mirror those for adults. Where apprenticeship systems are weak, youth unemployment is typically much higher, reaching three or even four times the adult unemployment rate. Switzerland and other countries with high quality apprenticeship systems have the lowest youth unemployment rates,” he added.
Germany runs a model national apprenticeship system which has been the subject of interest for governments all over. In December 2016, the unemployment rate for 15-24-year olds in Germany was 6.7% compared with 17.3% across other EU states. A robust apprenticeship program in Germany is often cited as the key reason to keep youth unemployment figures low. Germany’s vocational training programme which is a substitute to traditional higher education caters to around 60% of the country’s youth.
In 2015, the National Apprenticeship Service in the UK quoted, “A study by ICM Research of 500 companies reveals that employers in England rate qualified higher apprentices as 25 per cent more employable than those who took an alternative route into work.
” The ICM Research stated that employers paid a higher weightage to work-based skills and experience that apprentices acquired, compared to those who come out of the conventional education route. More recently, in August 2018, the UK’s Skills Minister, Anne Milton, said, “Quality is more important than quantity, and our shake-up of the apprenticeship system has been all about making sure apprenticeships, developed by businesses themselves, give people the skills they need to get the career they want.”
Focus on Apprenticeships
When the ILO’s Ashwani Aggarwal, Senior Skills Specialist, was asked why the ILO believes in apprenticeships, he said ‘The global youth unemployment rate has risen to a global average of more than 13 per cent in the decade since the global financial crisis began in 2007. Moreover, young people are over-represented among the unemployed, accounting for more than 35 per cent of unemployed people globally, despite representing just over 15 per cent of the world’s labour force.’ While admitting that apprenticeships are not the only solution to unemployability, policy-makers across the board are realizing the importance of ‘Quality Apprenticeships’. Ashwani describes ‘Quality Apprenticeship’ as ‘a system which contributes to matching skills in demand in the labour market with skills acquired in education and training systems, enabling young people to transition from the world of learning to the world of work. What is more, they play a key role in enhancing youth employability through personal development and a recognized qualification.’
Lending further credence to the value of apprenticeships in increasing employability, further research undertaken by the ILO for the European Commission has shown a consistent positive correlation between apprenticeships and higher employment. Immediate permanent employment after completing an apprenticeship ranges on average 60 to 70 per cent of the times- with close to 90 per cent in some cases- in Austria, Belgium, France, Ireland and the United Kingdom.
Similar findings have emerged from developing economies such as Brazil, where an assessment of the impact of the country’s apprentice programme SENAI showed that apprentices after graduating had a higher chance of securing a permanent formal job and earning higher wages in the short to medium term compared to those who had not enrolled in an apprenticeship programme. 80% of Brazil’s graduates from SENAI find employment within 6 months after graduation. In the Netherlands, the unemployment rate was 3 percent for youth who completed an apprenticeship as against 11-30 percent for those who passed out of a traditional education route for the same qualification level.
The answer for India too lies in skilling. Several corporates and PSUs offer apprenticeships and skills based training in India with transformational effects on lives of youth. We have listed a few of these in our blog ‘How Can Organisations Become Temples of Skilling’.
Speaking at a seminar on “Skill India – The Way Forward in Higher Education”, in October 2018, Union HRD Minister Prakash Javdekar said the government is looking into professional bachelor’s degrees which will make graduates immediately employable. “We are conceptualising professional BA, B.Com and B.Sc courses in which we will give a choice to students to take 1,000 extra hours of courseware along with their regular courses,” he said. “These will enhance students’ preparedness for jobs because we find millions of job opportunities waiting for the right person. On the other hand, we have millions of educated unemployed students. It is a perfect case of a mismatch. Those students who pick up skills will get immediate job placements. That is the need of the hour,” he added.
Mr. Rajesh Agrawal, Joint Secretary, Ministry of Skill Development and Entrepreneurship, further laid out that the government is also working on summer industry apprenticeships for all graduates to increase their employability skills.
In conclusion, if India gets the blueprint right, an efficacious national apprenticeship programme with adequate industry participation can unlock one of the greatest resources a nation can be blessed with – a vast ocean of young and energetic human capital.