In India, Educated but Unemployable Youths

New Delhi's Reena Dubey, 22, with classmate Sumit Kumar, said she is taking a skills-building course because she was "clueless" when she graduated.
New Delhi's Reena Dubey, 22, with classmate Sumit Kumar, said she is taking a skills-building course because she was "clueless" when she graduated. (By Rama Lakshmi -- The Washington Post)
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By Rama Lakshmi
Washington Post Foreign Service
Monday, May 4, 2009

NEW DELHI -- Barely eight months after leaving prestigious Delhi University with an undergraduate degree in commerce, Reena Dubey is back in the classroom, poring over a textbook on debt recovery and taking notes on India's banking industry.

"I studied economics, accounting, trade, corporate tax planning and industrial law for three years. But I was still clueless when I graduated," said Dubey, 22. "All my education was bookish and theoretical."

Hoping to secure an entry-level job as a credit card collection agent, Dubey recently enrolled in a skills-building course offered by New Delhi's Avsarr training academy for new graduates who want to work in India's booming banking and retail industries.

"India's job market has changed, but my degree has not equipped me for it," she said.

Dubey's deflating discovery mirrors the experience of most of the 3.2 million Indians who receive undergraduate degrees each year. The Confederation of Indian Industry says that 25 percent of technical graduates and 15 percent of other graduates can be readily employed in the jobs that the recent boom has generated in the telecommunications, banking, retail, health care and information technology sectors.

"The stark reality is that our education system churns out people, but industry does not find them useful," said T.K.A. Nair, principal secretary to the prime minister, addressing a recent conference here in the capital on linking education to employability. "The necessary development of skills is missing in our education."

About 69 percent of unemployed Indians are educated but lack skills, according to the Confederation of Indian Industry. Only 6 percent of the workforce has a professional certification other than a degree, a figure the Labor Ministry says it hopes to boost to 12 percent within five years. In February, the government announced an ambitious plan to address the skills gap by improving vocational training and encouraging cooperation between educational institutions and industry.

The problem is compounded by demographic changes that experts say will greatly expand the country's working-age population in coming years.

Today, about 54 percent of Indians are younger than 30. Census projections suggest that the proportion of Indians in the 15-to-64 age group will increase steadily, from 62.9 percent in 2006 to 68.4 percent in 2026. By 2020, the average age in India is expected to be 31, compared with 37 in China and 48 in Japan. Census reports say that India is entering the advantageous "demographic dividend" phase just as China leaves it.

In a report last year, however, the Finance Ministry said that if that growing workforce does not develop skills soon, the country could face "a demographic nightmare": a surplus of educated people and a shortage of qualified workers as labor requirements continue to shift from agriculture to industry.

"This is the biggest wake-up call for India. Our schools and colleges do not provide the skills that India's new economic drive demands," said Amit Kapoor, a professor at the Management Development Institute in Gurgaon, near New Delhi. "People are graduating without learning how to get things done, without complex problem-solving skills, without knowing how to put their theoretical education into practice, and with poor articulacy. Our schools are centers of rote learning and give out degrees without imparting employable skills."

The problem extends even to India's much-hyped engineering graduates, who have been the backbone of the country's thriving outsourcing industry in the past decade.

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