2/5/2009 Contents Economic scenario and growth engines Human Resource Requirements in various states The supply side situation and demand supply gap Recommendations The way ahead Skill Development Initiatives – the way ahead ICRA Management Consulting Services Limited v www.imacs.in Indian economy has witnessed steady growth in Indian economy – Then and Now the last few years Primary Secondary Tertiary THEN… NOW! In 1993-94 In 2005-06 20% 26% 54% 3,000 2005 ‐ 06 2,580 2,368 2,204 2,500 2,028 1,952 1,842 GDP in ‘000 Rs. Cr 2,000 22% 26% 52% 2003 ‐ 04 31% 20% 1,500 1,000 24% 25% 50% Primary Primary 2001 ‐ 02 500 0 0 25% 27% 48% 1999 ‐ 00 26% 26% 29% 28% 44% 1996 ‐ 97 Secondary Secondary � India has witnessed steady growth in the last few years – a growth rate of 7% on an annualised basis 31% 26% 43% between 2001 and 2006. 1993 ‐ 94 43% 54% � Several states such as Gujarat, Maharashtra, Andhra Pradesh, Punjab, Tamil Nadu and Karnataka 0% 20% 40% 60% 80% 100% have been at the forefront of this growth story. Tertiary Tertiary Source: Central Statistical Organization, Source: Central Statistical Organization, IMaCS analysis. IMaCS analysis. v v India’s economic landscape will be shaped mainly by Transition in nature of employment following high growth industries Compos mposit ition ion of of GD GDP P in ‘ ‘93 3 - 94 Compos mposit ition ion of of GD GDP P in ‘ ‘05 5 - 06 Proportion of Proportion of High people employed people employed Auto Construction in Agriculture ~ in Agriculture ~ and Primary 58 % 67 % Tourism 20% Engg Primary 31% Tertiary Employment Financial 43% IT & Potential Services Tertiary ITES Textiles 54% Secondary Secondary 26% Secondary Chemicals & Healthcare 26% Fertilizers Engineering Drugs and Agro and Pharma Food Biotech Processing Greater is the size of the bubble, bigger is the size • Agriculture continues to be the largest employer Paper Mines & of the industry Minerals • Manufacturing and Service Sectors have emerged as important employment providers Low High Low Competitive Positioning Source: IMaCS analysis v v 1
2/5/2009 IMaCS has conducted skill mapping studies in various Contents states and identified human resource requirements � IMaCS has conducted skill mapping studies in association with Confederation of India Economic scenario and growth engines Industry (CII) in several states � The studies have been conducted in a cross section of states: Human Resource Requirements in various states � Tamil Nadu The supply side situation and demand supply gap � Andhra Pradesh � Maharashtra Recommendations � Jammu and Kashmir � Punjab � These studies present the dimensions of the skill gap problem. v v Employment projections in major industries in A snapshot of how these human resource requirements span select states - till 2015 out in Tamil Nadu for high growth industries 0.2 to 0.3 Employment (in 000s) Incremental 2015 (in 000s) % of incremental million 2015 Curren 1.8 to 2 t 4500-5500 36%-39% 9000 0.3 to 0.5 Textiles 4500-5000 million million 1800 13%-14% 4000-4100 Construction 2200-2300 900-1150 7%-8% 2000-2200 Leather 1050-1100 260-265 2% 380-390 Financial Services 120-125 450-500 3-4% 520-580 Auto 70-80 6 to 6.5 285-300 2% million 300-350 ITES 55-65 7.5 to 8 million 320-400 3% 380-450 IT 50-60 20 0.1%-0.2% 45-50 13 to 15 Light Engineering 30-35 Total incremental million 13-15 employment (in million) v v Source: IMaCs analysis Source: IMaCS analysis A snapshot of how these human resource requirements A snapshot of how these human resource requirements span out in Maharashtra for high growth industries span out in Andhra Pradesh for high growth industries Incremental human resource Incremental Human Resources Key Industries Key Industries Requirement till 2012 (in ‘000s) Requirement till 2015 (in 000s) 1,338 4,402 Construction 4,210 2,010 3,064 Construction 2,200 1,257 1,916 1,826 Textiles 1,081 745 Organised Retail 659 893 679 IT and ITES 741 1,143 152 IT and ITES 464 850 Healthcare 559 290 440 1,203 1,366 Banking, Financial Services, and Insurance Tourism 515 764 851 478 417 180 180 Drugs and Pharma Drugs and Pharma 248 248 230 230 Agro Processing 237 268 132 Banking and Insurance 117 135 480 Pharmaceuticals 303 Total Demand - 7.5 to 8 215 116 Engineering 99 Total Demand – all 158 450 million 225 111 Engineering Mines and Minerals 292 industries* - 6 to 6.5 million 114 83 307 280 110 Agro and Food processing 198 Chemicals and Petrochemicals 197 44 131 Chemicals and Fertilizers 87 164 45 Auto and Auto Components 19 119 24 Biotech 5 11 33 - 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 Paper 21 Employment by 2011-12 ('000s) Current Employment ('000s) - 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 2006-07 Source: IMaCS analysis Workforce in '000 s * - The secondary and tertiary sectors considered here exclude sectors such as Utility Services, Public v Administration and Defence, Transport, Storage and Communication, Unorganised Trade. v Employment by 2014-15 ('000) Current Employment (000) Source: IMaCS analysis 2
2/5/2009 A snapshot of how these human resource requirements The human resource requirements will be at various span out in Punjab for high growth industries levels as illustrated below TN Punjab J&K AP Maharashtra Sector Employment ('000) Specialised 4 - 5% Incremental 6 - 7% 3 - 4 % 1 - 3 % 1% Skills 2006 2015 (current - 2015) Skill Textiles 305 540 235 Category 35 - 37% 10- 12% Auto & auto components 54 96 42 Level II 21 – 27% 22 – 28% 24 – 29% Food processing 170 300 130 Roughly 1.9 million Skill Category Level Skill Category Level Li ht Light engineering i i 345 345 720 720 375 375 24- 26% 24 26% 45 - 46% people needed in the I IT & ITES 13 75 62 high growth industries and 2.9 million in overall Minimal Education Real estate & construction 910 1720 810 70 – 75% 70 – 75% 80 – 85% 38 - 40% 31 - 33% (Skillable) industry by 2015 Retail and location-based entertainment 30 325 295 Total in high growth 13 to 15 1.8 to 2 0.2 to 0.3 7.5 to 8 6 to 6.5 Total Demand industries 1827 3776 1949 million million million million million Other industries 297 1284 987 2124 5060 2936 Total in economy v v The expected economic growth of over 8% necessitates Contents demand for skilled workforce. However… Economic scenario and growth engines - Only 10.1% of Human Resource Requirements in various states male workers and 6% of female workers - In the age group had marketable had marketable of 20 24 years of 20-24 years, The supply side situation and demand supply gap only 5% of the skills workforce had - While, Korea vocational skills had -96%; and Recommendations other - 44% of all industrialised - While, Mexico workers illiterate countries – had 28% 60%-80%. - 22.7% of workers – only primary schooling v v Source: Planning Commission, Government of India … only a small portion of human resources have Key issues in the current education system employable skills Lack of focus on employability Arts, Science, Vocational Education Engineering Commerce and Training Lack of industry – institute linkages Inadequate practical orientation ~ 11 lakh ~ 7 lakh ~ 98 lakh Infrastructure bottleneck Only 30% - 40% of students are employable Policy support Source: Selected Educational Statistics 2004-05, Ministry of Human Resource Development, Government of India, Enrolments in the year 2005, NTMIS v v 3
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