By Sashi Kumar
Even with the General Elections still a few months away, the Annual Budget for 2019 is eagerly anticipated. In spite of business disruptions in the recent past – implementation of the demonetisation policy, the Goods and Services Tax (GST), or the most recent liquidity crisis in non-banking financial corporations – the economy has grown at a steady rate of roughly 7% on average.
Several key sectors of the economy have seen significant growth in the past year alone, such as Information Technology (IT), Infrastructure, Retail, Healthcare and Telecom, to name a few. In fact, if 2018 job search trends are an indication to go by, we can easily observe the shifts in the current job market.
Indeed s statistics indicate that searches for blockchain jobs witnessed an increase of 687% in 2018, signifying growing interest in new age tech jobs. There has also been an increase of 164% in AI related job searches and 233% increase in robotics related job searches in India, further testifying that the technology sector still holds allure for Indians and is capable of creating jobs.
Interestingly enough, a different sector also came into the limelight – the renewable energy sector. A growth of 35% has been observed, making the energy sector one of the top 5 employment choices in 2018, according to Indeed.
Even so, job creation continues to pose a challenge for the government. Despite projections of creating 1 crore opportunities, the jobless growth conundrum persists, for reasons that need deep diving and corrective action across stakeholders. The most recent issue that has gripped the government is the need to find an inclusive means of assimilating and assessing data on job creation across sectors.
In particular, tracking jobs in the informal sector through a reliable source remains a challenge.
However, this does not negate the fact that there could be numerous job opportunities which are being created in sectors such as Tourism, Agriculture, small-scale Manufacturing, and Infrastructure and Real Estate, where employment is largely undocumented.
The formal sector, however, is relatively simpler to navigate, and if supplemented by the efforts of private market players, could be mapped in a consistent manner over time.
Now coming back to the issue of employment. If India has to address its employment issue it cannot afford to ignore the three important Es Education, Employability and Entrepreneurship.
Let us look at why quality education cannot be ignored. Despite the rise in the number of children getting into schools and youth passing out from universities, in June 2018 it was noted that the national employment rate in India had, surprisingly, fallen to 4%. According to the Annual Status of Education Report (ASER) study, the learning deficit visible so far in elementary school children is now being reflected among young adults too.
While the youth are technically sound, they are found to be lacking in soft skills and this impacts their employability. This is a frightening situation as an issue with productivity in a cohort (student population) that accounts for 10 per cent of our population will have an impact on the economy as a whole. It not only makes them unfit to join the formal workforce, it also adds to the building problem of unemployment.
It is high time the Indian education system relooked at its curriculum and considered introducing training modules that will help young people become future ready. While there are multiple factors that could be hindering job creation, such as the unavailability of talent on ground, lack of mobility of resources for example, another key concern observed in the Indian labour market is the issue of talent mismatch where existing talent lacks the requisite skills to fill available job openings. The lack of employability in emerging talent is a serious concern as it affects the framework of larger economic machinery. The need of the hour is to bridge the skills gap, so that new entrants to the workforce are well-equipped to perform to industry standards.
According to industry body NASSCOM, a growth rate of 9% for new job roles that require a high level of skills has been predicted in the technology sector. Job searches for these roles too have continued to grow in recent years. Since the start of 2018, employer demand for AI skills has been consistently twice the supply of job seekers. From 1.2 in April 2017, the AI skills gap in India has steadily worsened, hitting a 3-year high of 2.2 in June 2018, i.e. employer demand for AI skills outstrips job seeker supply by 2.2 times.
This is an indicator of the need for skill development in the larger STEM sector and the technology sector in particular. Research by the National Institute of Skill Development (NISD) indicates that only two per cent of the country s total workforce has undergone skills training presently. The good news is that, more recently, the talent mismatch levels have been on a decline, which is an encouraging sign for both job seekers hoping to work in the sector, and companies seeking skilled talent in the field. Even then, there is a lot of ground to cover.
The shared economy and start-up segment, in general, has been a boon with respect to creating large scale employment. The formalisation of otherwise informal jobs made possible by the likes of Uber, Ola and Swiggy, among others is remarkable.
The government must work towards easing the setting up of start-ups to ensure improved employment rates, such as the issue of the Angel Tax that is currently giving young entrepreneurs sleepless nights. The Union Budget should hopefully make provisions to lower this liability so that start-ups can focus on scaling more heights.
In all, if the learning deficit can be addressed with the seriousness it deserves, youth are made more employable by addressing talent requirements, and entrepreneurship is adequately fuelled, the issue of job creation can become far less daunting. Then, we will have to worry less about creating an actual indicator of jobs created as the results will show for themselves.
(The author is Managing Director of job search firm Indeed India)