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The untapped goldmine India needs


Utilising migrants, encouraging female workforce participation and leading dropouts to suitable career options play an integral role in improving India’s economy, writes Shaheen Khan, founder and CEO of CEDP Skill Institute.

The untapped goldmine India needs
With the rapid economic growth and developmental strides, undoubtedly India is on the road to becoming one of the most significant growth engines in the world.
In the last five years, the country’s inflation rate has come down from over 10 percent five years ago to about 4.6 percent, the fiscal deficit has come down from almost six percent to three percent. However, despite a rapidly flourishing economy, the country is facing a challenge in managing growth to sustain economic performance.
India is the second largest in the world with a workforce of over 487 million people. Most of our workforce is from unconventional areas of operations such as push-cart vendors to in-house run tuition centers.
Currently, over 52 percent of India’s total labour force occupies the agriculture, dairy, horticulture and related operations sectors which, contributes to 16 percent of the GDP. In reference, the service industry contributes to an approximate of 62 percent and industrial activities contribute to 23 percent.
Despite the service sector having a considerably lesser workforce participation than the agriculture sector, it still amounts to most of the GDP due to the fact that the people employed in organised and formal industries are relatively better educated and have the necessary skills to perform or do the work on a global and domestic scale which offers a higher turnover.
Moreover, the disparity between the service sector and agriculture sector is not the only downside to India’s current workforce scenario. To boost India’s growth, we must first utilise the relatively untapped potential human resources and manpower resting in plain sight.
Utilising migrants, encouraging female workforce participation and leading dropouts to a suitable career options play an integral role in improving India’s economy as well as reach full employment to contribute in making India’s GDP increase significantly.
According to the recent report on Labor Force Participation Rate (LFPR), in past 24 years, the female labour force participation rate has decreased to a little over 18 percent in rural areas while 15.9 percent in urban areas.
A 2015 report by McKinsey states that if the female workforce participation increases by even 10 percent, it would add upwards of $700 billion to India’s GDP by 2025.
Therefore to ensure female workforce participation, firstly the notion of women being house-makers and primary caregivers should be changed by society. Industry and government body should take proactive strides to ensure that men and women contribute equally to the economy.
Another part of our workforce, which remains relatively unproductive are dropouts. The amounts of students who give up schools and other educational institutions have started to increase.
In India, about 30 percent of students drop out at a senior level, followed by 25 percent dropping out of secondary education while 6 percent drop out of elementary schools.
With India being the second most populated country in the world, the school dropout rate is relatively high when compared to other developed countries for the younger age groups which are of 10-15 years of age. There are a plethora of reasons for which a student may drop out, may it be financial instability or ailing family members who need assistance.
Dropping out of education limits the scope of employment, thus with an increasing dropout rate for a densely populated country such as India, there will be many people who remain unemployed and counterproductive to the economy. Therefore skill training must be implemented to help them to get employed.
Education and skilling are two intrinsic tools in empowering the marginalized, encouraging entrepreneurship and ensuring the growth of a country as well as its citizens.
Skilling either compliments your ongoing education or provides employment after completion of the course, therefore skill training programs and classes should be implemented at a primary level for the youth to have a back-up in case they do drop out and should be optional in all educational institutions to help boost employability.
Seasonal migration for work is a prevalent phenomenon in rural India. According to the Aajeevika Bureau, over 120 million labourers and workers migrate to urban areas for seasonal or temporary employment.
Poverty, political unrest, development, and population are some of the major contributing factors to the current trend of migration. The major sectors in which the migrant labour force choose to work is the construction sector with an approximate of 40 million migrants, followed by the domestic work sector with 20 million migrants and lastly the textile industry with 11 million migrants.
Some other industries which migrants choose to work in are brick kilning, transportation and agriculture. There are also an estimated 30 million Indian migrants who have chosen to work overseas due to better pay and opportunities.
It is important to limit the large-scale migration of our potential workforce across borders so that they are contributing to the growth of India and not any other nation. Also, India needs to be focused on generating an employment opportunity for the labourers and graduates within their nativity, which will contribute to a better standard of living in India.
The Way Ahead
The challenges faced by the marginalised workforce of India are mainly due to the lack of formal qualification, suitable job opportunities, underpay, lack of motivation and low profile work etc.
Due to the absence of a rationalised approach towards education and employability, India’s half of the workforce, which includes women, dropout and migrant remains untapped and unproductive. Once provided with the right opportunity and platform, this section can tremendously bring meaningful change in their lives and can benefit the economy.
Through the extensive promotion of up-skilling and reskilling the marginalized workforce to enter the job market with self-esteem. A large proportion of the country’s annual budget should be allocated towards this segment, which will help in increasing literacy rate and improve poverty. The underutilized sections of society are mostly unable to afford higher education. The government should provide them with financial aid which is easily accessible to reduce the cost of their education.
Private organisations through CSR initiatives should train the marginalised workforce and give them entry in the high-value work profile. This will eventually help the industry to fulfil the workforce demand. Effective policies need to be created by policymakers to educate socially and economically disadvantaged people and improve opportunities for them. When each portion of a population is empowered, they can contribute fully to the socio-economic growth of India.
Shaheen Khan is founder and CEO of CEDP Skill Institute.

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