Employment and Employability - two sides of the same coin?

Dr. S.S. Mantha Jun 04, 2017

The National Employability Report (NER), 2013 of Aspiring Minds, a New Delhi-based employment solutions company reported in 2013, that 47% graduates are not employable in any sector of the knowledge economy. India Today reported on July 13th 2016, that, the same group conducted an employability-focused study based on 150,000 engineering students and found barely 7 per cent suitable for core engineering jobs. A key finding of the 2016 NER, has been that the employability figures were 17.91%, 3.67% and 40.57% respectively for IT Services, IT Products and Business Process outsourcing only a shade different from the figures in 2013. The report goes on to add that this is despite the fact that the number of engineering seats had not increased in the past year. A study conducted by the McKinsey Global Institute in 2014, places the employability percentage of the engineering graduates at 25.

The “Automata National Programming Report’, conducted across 500+ colleges by the same group, claims that over 2/3rd could not even write code and so 95% engineers are not employable. A ridiculous claim by any standard. Surely, if ability to write code was a yardstick for employability, an institution could just do that and claim 100% placement.

Since the sectors covered are IT and ITES, it will also be interesting, to know the effect of large scale automation, use of artificial intelligence (AI) and intelligent agents that have almost dried up the entry level jobs in this sector. The IT sector, as it is, is in the throes of headwinds.

All these figures hide more than they actually reveal. The findings need to be seen in the context in which they were created for both, concerns and positives to emerge along with several important insights. Food for thought and pointers for policy initiatives emerge too.

The Plight

It is anybody’s guess, sometimes scary, to imagine the plight of graduates of other disciplines and their employability in this scenario. Some experts in the field have expressed that there has been a spurt in new institutions that have no quality to offer and hence are better closed. There also seems to be a surfeit of reports by various consultants and industry bodies and groups on Technical and Management education as if no other discipline existed, that seem to suggest that the expansion had been beyond comprehension, lacked quality and not connected with employment. Let’s look at the bare truth.

A private individual perceives a business opportunity, invests his money, owns the land, is willing to go by the book and wishes to setup an institution, the constitution allowing him to practice his chosen profession, nothing would stop him, not even the regulators who anyway cannot pre suppose that he would not provide quality. Operational impediments like finding quality students and teachers however would stop him somewhere along the way. Great institutions were not built in a day as the adage goes. Market forces would soon takeover and he would be forced to shut shop anyway, which is fine in a liberal market economy.

The National GER in the tertiary education has been hovering around 22 with technical education contributing to a little more than 4 points out of that figure. USA boasts of 65. The vision document both at the Centre and in the State of Maharashtra has set a GER target of 35 by 2020. In order to realise this, a massive expansion is required in the availability of all colleges technical included. Not just expansion, it would also require a great number added to students who appear and pass X and XII standards calling for a quantum improvement in the schools education. When achieved, it still means that 65 students out of every 100 need to look elsewhere and vocational education and training (VET) may be an alternative, if marketed and supported by the markets well.

Quality of education apart, even a notional moratorium at the current GER and planning for the same, we need at least five million jobs employing five million graduates passing every year, year on year, a million of them, in the technical eco-space. Currently do we have these is the moot question. In the absence of sector/discipline related jobs, it is only natural, that graduates would veer to jobs wherever they are available resulting in under employment. A robust labour management information system (LMIS) that covers all sectors has to support this cause and the industry bodies would do well to create it and not just target the employability matrix of engineers. Employment and employability are two sides of the same coin and one cannot survive the other.

India’s Job Markets need to take a leap in geometric progression in coming years if we were to contain the aspirations of 65% of the population below the age of 30 years. This would mean creating at least 15 Million jobs this year that grows at a rate of a minimum of 3.5% to 4% each year, a tall order indeed. As an aside, let me put forth two suggestions one to improve quality and the other that concerns employment.

On the quality front, raise the bar from 45% to 75% at the qualifying examination or XII standard as the case may be, to get an admission to an engineering college.

This would effectively mean that the bottom of the pyramid is knocked out. The Quality of technical education would improve since the students in the 75% and above bracket would only be eligible to pursue technical education. The institutions at the bottom of the ladder would close for lack of students and consequent lack of viability. Of course the better faculty in these colleges would migrate to the institutions that are doing better and the bad faculty would have to pursue other avenues which the society would not grudge anyway. This would enable better faculty student ratios to be maintained and eventually contribute to better delivery of education.

The employability would also be better due to better stock and relatively lesser competition. Various reports would then blare “The employability situation in the Country has improved”. Like every solution or problem, depending on which side you are interested in, has a flip side. This postulation too assumes, that anybody who has probably failed to pass the grade, at the qualifying examination, has no right to ever redeem himself or herself, notwithstanding the premium placed on concerns of equity and access and the inability of the system, to cater to such societal concerns. In the absence of any worthwhile future, these children would navigate to the so called distance education, legal or illegal and be exploited by the fly by night operators.

Social inclusion would be affected, since the entry level for socially disadvantaged groups would also have to be hiked to at least 70%, commensurate with other such interventions.

Inequalities afflict the country in education and employment based on caste, ethnicity and even gender. How, this dilemma would be addressed when the bar is raised is anybody’s guess and I am sure this postulation would never pass the muster on political grounds or otherwise. Why do we, then indulge in finding answers where there are going to be none? However, it is not my contention that the system does not need a relook in terms of quality.

The second suggestion for improving employment scene, is based on the current data on available jobs which is sketchy anyway. Is there one credible report on available jobs, sector wise, year on year, created by any of the Industry bodies available today? In the absence of such data, assuming half a million jobs are available each year, and theorising, that a little more than half a million graduates, would be allowed to progress out of the system each year and by implication, close down rest of the colleges, since there would be no employment opportunities, would we be serving the National cause?

Another finding of the report, suggests that only 3.84% of engineers qualify for a start-up technology role which is a big concern and would surely hamper the growth of start-ups in India. This of course, can survive only in an enabling start-up eco space environment and the ability to take risks. Certain communities have traditionally been in business in the country, with certain cities providing more opportunities than others. Both these perceptions however need to change.

The United Nations International Labour Organization (ILO) released its 2017 World Employment and Social Outlook report, which finds economic growth trends lagging behind employment needs and predicts rising unemployment throughout 2017. "Unemployment in India is projected to increase from 17.7 million last year to 17.8 million in 2017 and 18 million next year. In percentage terms, unemployment rate will remain at 3.4 per cent in 2017-18,"

The insufficiencies of the unemployed youth by the year 2020 can and must be avoided. The dial is moving slowly but certainly, and the year 2020 is also when the millennium’s first 20 year olds will be looking for their spring, to see how they come on board, with what is happening on the streets and alleys around them.

If a paradigm that is based on restricting education and skills, to fit the available space of employment and opportunities or as a political expediency, either in the education space or in the employment sector, is proposed and is perforce allowed to settle, we could be staring down the barrel of a civic uprising. Instead of measures like restricting number of colleges or suggesting that they be closed, we need to improve the school systems, to have better and more endowed children pursuing higher education, and increase massively the employment opportunities. Make in India, Skill India, Start-Up India and Digital India are all master strokes, in the right direction, though their delivery models may need a rethink. This would create wealth for our citizens with a consequent rise in the Country’s economy.

A new technical institute, to become a reality, requires in the minimum, Rs. 50 Cr, 10 acre land, several approvals from local authorities, National bodies, and at least two years of hard work, passion and perseverance from its promoters. It is a matter of grave concern if at a later date an epitaph would have to be written for whatever reason.

Quality does not lie end to end in any system, be it education or any other. Like water finds its own level or the theory in economics that postulates in a predominantly market based economy, “of what the traffic can bear”, a system would need to evolve and has to provide for everyone in the supply chain, or we would be catering only to the elite, thus creating great dissentions, that would be detrimental to the very notion of a Nation. In a market economy, the fittest will survive. This does not mean that we retain only the top performing ones and cast away the rest. Most certainly, quality improvement initiatives need to be put in place. Equally important, is to recognize that new markets for employment, are explored and forged aggressively for realizing the dream of “Uttam Bharat” and “Unnat Bharat”