Scope & Present Scenario
Skill Training Business in India
A study by the Ministry of Human Resources and Development puts the shortage of skilled manpower at more than 3.2 million in 2020. The industry estimates say that nearly 70% of all graduates in India are unemployable since they do not have the required skill sets. Thus, it has become the top most priority for the country to have a strategy that will enable it to effectively address the multiple challenges in the education sector which can supply the adequate and skilled manpower to industry.
Here, we would like to put few facts for your attention:
- India has about 300 million unskilled employable people.
- Only 2-4% of the population learns a skill or trade.
- 12 million workforce joins labour market every year.
- Little connect between education and employment.
- Present economic growth is unsustainable if the work force does not acquire right skills to support a knowledge and technology driven industry.
- Manpower with subjects & trade knowledge lacks basic communication skills.
Skill training is training for a specific career or trade; it focuses on practical applications of skills learned, and is generally unconcerned with theory or traditional academic skills. Skill training thus provides a link between education and the working world which is actually required in the current scenario. Here, we would like to share few facts which reflect the cause and need for vocational training:
- After Economic liberalization the Contribution of service sector as a percentage of GDP has increased from 43% in early 90’s to 56% in 2015
- Every year 16 million students pass out of class X, of which 11 million go to class XII, leaving 5 million out of the education stream.
- Those who dropouts after XII or before completing bachelor’s degree are approx 20 million.
- Urgent attention needed for this 25 million target group
- Available formal training capacity with the government in the country is only 2.3 million students.
- This leaves a gap of 22.7 million, The current market size of private vocational training is estimated as Rs. 18000+ Cr.
Skilll training, the country’s most ignored education sector has got momentum recently when the Govt. Of India has allocated a budget of Rupees Crores in current year towards training and skill enhancement program to be conducted across the country through various ministries including Skill Development, Rural Development , HRD , Social welfare and poverty alleviation , PMRY etc . Skill Training market is estimated to be worth around 1200bn Rupees, comprising 300bn Rupees in accounting, banking and financial services sector only and 900bn Rupees in other areas. In India, out of 300mn workforce is available for Skill training to get the employment, 29mn only been enrolled for skill training , while the remaining 271mn are deprived of skill oriented education or vocational training. Out of this 271mn workforce, 27mn can be sent for the financial services sector training to fulfil the demand of the sector . Budget allocation from the govt. Sector for the Skill training has been increasing over the last three years.
Source : National Council of Applied Economic Research and Ministry of Labour & Employment .
At present the capacity of skill development in India is around 3.1 million persons per year. The 11th Five Year Plan envisions an increase in that capacity to 15 million annually. India has target of creating 500 million skilled workers by 2022. Thus, there is a need for increasing capacity and capability of skill development programs. Presently a number of schemes being run by central and state governments to promote unemployed youth from under privileged families across the country. The tremendous business opportunities for entrepreneurs are lying to grab, the need of the hour is to build the capacity to grab such projects on regional and national level.