Fixing India’s Apprenticeship Regime, Manish Sabharwal, Chairman, Teamlease Services

 

 ~ Apprenticeships are an important part of most developed skill development regime because they combine ‘learning by doing’ with ‘learning by earning’ ~

Policy makers in India today are facing a peculiar challenge – which sectors will create what kind of jobs in the next 20 years? The answer to this is of course crucial as it will determine the fate of our country. The answer to this question is crucial because educators need to decide what kind of skills and education to impart to young people far ahead of when they hit the labour markets. The answer to this question is also crucial because now in India the notion of district collectors distributing NREGS money as job creators is discredited!

But accepting that most attempts at job forecasting make weather forecasting look like physics is difficult for economists and policy makers who build complex forecasting models. Flawed models – however complex – have dangerous consequences; the physics envy of finance led to huge losses because quantitative models used in calculations like Value at Risk or Credit Default Swaps were precise but incomplete.

A comprehensive and multi-decade review of attempts by many countries including the US, UK, India, Japan, etc. of long-term job forecasting suggests that the accuracy, in hindsight, has been poor. To be fair, just like the higher accuracy of weather forecasting in the very near term (one or two days), these models know where job demand will be in the next one or two years. But this is not enough to craft long term education policy.

India is in skill emergency. Lots of ideas are on the table – in fact they are falling off the table. We need an urgent dose of political courage to resolve regulatory bottlenecks at the intersection of the Ministry of HRD and labour (NVEQF, Sector Skill Councils, etc) and State and Central Governments (Employment Exchanges, Apprenticeships, etc.). We don’t need more money but surgery on how money is spent. Not more cooks in the kitchen but a different recipe. Combining Apprenticeships and NREGS would be a radical innovation at the intersection of education, employability and education. It would co-opt employers in ways that the government has never tried. And it would offer dropouts (50% of the 300 million children enrolled in school won’t finish secondary school) and unemployable graduates (estimated at 58% of the 14 million students in 26,500 institutes of higher education) an alternate pathway to skills and jobs.

India needs a new Apprenticeship regulatory regime that clearly recognizes, 1) apprenticeships are classrooms not employment, 2) stipends are tuition subsidy and not salary, 3) durations for different trades and candidates need to vary from 3 months to 3 years, 4) the partition between the jurisdictions of the Ministry of Labour and HRD is unnecessary because it creates policy orphan like non-engineering graduates and amplifies the apartheid between skills and higher education, 5) we need employer sponsored programs that are allowed to outsource theoretical training, 6) we need educational institute sponsored programs that are allowed to outsource practical training, 7) the current stick of jail is not working and capacity will be higher if employers are volunteers, 8) moving away from the current license raj to nationwide permissions for national employers will increase capacity, 9) removing the size ratios on apprenticeship programs run by employers will accelerate capacity creation because apprenticeships have a lower expansion speed limit than physical classrooms, 10) the most effective labour market subsidy is subsidizing stipends.

These reforms should be designed to counter current opposition. Models that try to predict where jobs will be created in the next few decades have the efficacy of palm reading or astrology – this makes them unreliable input for decisions with long shadows. More than trying to predict the future, we should try architecting our education system to be self-healing in coping with changing employer needs. What better place to start than expanding our formal apprenticeships to 10 million youth?

 

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Posted on December 6, 2012, in skills development. Bookmark the permalink. Leave a comment.

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