The seventeen Sustainable Development Goals (SDGs) were adopted by member nations of the United Nations in September 2015 and are set to be achieved between 2016 and 2030. These include goals such as eradicating poverty, ending hunger and providing universal access to healthcare, education, clean water, sanitation and clean energy. The eighth goal of the SDGs covers economic growth, skilling and decent jobs.

Skill Development in India

India has one of the world’s largest labour workforces. However, despite the fact that 12 million people get added to the workforce every year, only less than 4 per cent receive any formal training. Our workforce readiness is one of the lowest in the world and a large chunk of the existing training infrastructure is irrelevant to industry needs.

In 2015, the government launched the National Skill Development Mission to complement initiatives like ‘Skill India’ and ‘Make in India’. The Pradhan Mantri Kaushal Vikas Yojana (PMKVY) is the flagship skill training scheme of the Ministry of Skill Development and Entrepreneurship (MSDE). Uttar Pradesh is currently leading other states in skill development. In addition to government initiatives, there also exists a National Skill Development Corporation (NSDC) which is a public- private partnership.

Currently, there are at least 20 different government bodies in India running skill development programmes with no synergies and considerable duplication of work. The presence of multiple stakeholders coupled with lack of coordinated policies has resulted in no standardisation of procedures or outcomes. The government today does not have a unified definition of ‘skill.’

Sustainable Development Goal 8 and Skilling

SDG 8 deals with sustainable economic growth, decent jobs and skilling. Target 8.1 deals with a sustained rate of per capita economic growth. Target 8.2 aims for an increase in economic productivity and Target 8.3 calls for enhanced development-oriented policies. Subsequent targets aim for full and productive employment, labour rights, eradication of child labour, financial inclusion etc.

India and SDG 8

With a GDP USD of 8 trillion¹, India is the third largest economy in the world after the US and China in terms of its GDP (purchasing power parity). However, due to its large population, India has low levels of per capita GDP. Despite a growing GDP, numbers for employment creation in the country have declined. Financial year 2014-15 saw only 500,000 new jobs created. The job creation in 2016 was even lower. Many factors have contributed to this trend such as shrinkage in global demand, the fact that growth today is taking place more in capital intensive sectors as compared to labour intensive ones etc. Economy is becoming increasingly less labour resistant i.e. work is now being done with fewer employees.

The sectors of the economy that are emerging as the largest job creators are IT, telecom, healthcare, retail and infrastructure.

The Indian economy is characterised by a large informal sector. According to NSSO 68th round, among workers in AGEGC² and non-agriculture sectors, about 72 per cent were employed in the informal sector.

India’s population has a large proportion of young people and thus has the potential to capitalise on the demographic dividend. However, whether it will actually benefit from this demographic dividend would depend on how and how much India invests in its human capital. India has a large proportion of its workforce engaged in the informal sector. The country is plagued by low skill levels among the youth and low levels of work productivity (especially in the agricultural sector) and by social evils like child labour. The successful achievement of SDG 8 will enable India overcome these challenges and reap its demographic dividend.

With regard to indicators for SDG 8, most of the IAEG-SDG indicators are fairly straightforward and are already measured in India.

There are two major employment and unemployment surveys in India, conducted by the NSSO and Labour Bureau respectively. The surveys have similar concepts and definitions. Therefore the question that arises is whether both need to be conducted, especially in the same year as has happened in the past. There is scope to include probing questions to ascertain the conditions of employment of people in employment surveys. Some wage surveys in India are conducted quite infrequently and in some cases one wage survey is found to be duplicating the effort of another.

Youth Not in Employment, Education or Training

Target 8.6 calls for reducing the proportion of youth not in employment, education or training (NEET). The IAEG-SDG indicator for this target is ‘percentage of youth (15-24) not in education, employment or training’.

NEET rate is calculated according to the formula specified below and expressed as a percentage (Elder, 2015).

(No. of youth – no. of youth in employment + no. of youth not in employment who are in education or training) / Total number of youth

The data required to calculate the NEET rate can be derived from the NSSO Employment Unemployment Surveys. It may also be derived from Labour Bureau surveys and Census surveys. However, the level of detail required to make the calculation regarding the NEET rate – specifically, the education status of youth (in school or out of school) cross-tabulated by labour force status (employed, unemployed or inactive) – is rarely found without direct access to the survey micro datasets. These micro datasets are rarely available in the public domain in the case of NSSO surveys. Nevertheless, India’s NEET was calculated for the year 2004 using NSSO data (Elder, 2015). It was found to be 27.2% for youth aged 15-29. Looking at sex-disaggregated NEET rates in the same year for the same age group paints a picture of extreme gender disparity. The NEET rate was 6.4% for males and 49.0% for females. OECD estimates peg India’s NEET rates for 15/16 – 24 year olds in 2012 at 28.9% (OECD, 2014). While India initiates the regular measurement of NEET rate, it should make sure that the calculation is done and reported in a periodic fashion i.e. after each NSSO Employment Unemployment Survey.

Conclusion

A 2006 report suggests that India's working population in 2020 will be equal to India's total population when reforms started in 1991. Projecting current variables forward means 211 million people will be unemployed in 2020; an unemployment rate of 30%. Unemployment will largely be a youth problem. Nine out of ten unemployed are likely to be in the 15-29 age bracket. Keep this in mind, it should be noted that skill development is a tricky sector for the government to channel resources into. To justify investments, policies must be grounded in solid data. Scheme design parameters, such as sector and beneficiary targeting, curriculum, delivery methods, etc., need to incorporate authentic market signals. Existing skill gap studies rarely provide agile and actionable data and are rarely used in scheme designs. For any skill development efforts to succeed, markets and industry need to play a large role in determining courses, curriculum and relevance.     q

¹  Gross domestic product based on purchasing-power-parity (PPP) valuation of country GDP (Current international dollar) according to International Monetary Fund data, available on www.imf.org
² [ag]riculture sector [e]xcluding [g]rowing of [c]rops, plant propagation, combined production of crops and animals without a specialized production of crops or animals.