FC Experts Blogs
June 20, 2007
India - The Super Job Creator
A recent study shows that India is by far the highest new jobs creator in the world. It may be celebration time for Indians, but is this also the right time to reflect on aspects that could bring the party crashing down?
Well, India’s economic success story is official now. India has created the maximum jobs in the world during the period 2000-2005. Paris-based Organization for Economic Cooperation and Development (OECD) has claimed in its recently released Employment Outlook 2007 report that India generated 11.3 million net new jobs per year on an average. During the same period, China created 7 million net new jobs while Brazil and Russia created 2.7 million and 0.7 million net new jobs respectively. India’s unemployment rate of 6% in 2005 also compares favorably with other BRIC countries whose unemployment rates were hovering around the 8-9% mark at the same time.
Comparing to rest of the world, the BRIC countries together created more than 5 times new jobs than the OECD area as a whole. OECD, comprising 30 developed countries including the US, UK, France, Germany and Japan created 3.7 million net new jobs a year compared to the 22 million created in the BRIC countries.
Despite the buoyant job market, there are a few things that India needs to sort out on a priority basis. One, women and youth are grossly under-represented in the workforce. Two, most new jobs are in the services sector. Manufacturing and agriculture related industries are fading into oblivion making for a lop-sided economic growth. Three, supply of skilled manpower is not matching up to the demand. There is a shortfall in the number of qualified engineers for the technology sector and trained graduates for the booming BPO sector. Same is the case for organized retail, an industry still in its infancy in India but growing exponentially by the day. The difference in this demand and supply is pushing up salary levels, destroying the economic viability of several businesses. Further, unhealthy poaching of talent from competition is vitiating the business environment.
The private sector is taking it upon itself to train youngsters to meet specific needs of their respective industries. NASSCOM, India’s association of IT and ITES companies, is starting programs to convert raw engineering talent into polished technology professionals. Reliance, India’s largest private sector company, is planning the same with high school grads trained to manage retail outlets. But, do individual companies have the wherewithal to bring about nation-wide changes? Or is this time for some affirmative action from the government to prevent the Indian economy from outgrowing itself?
Anupam Mukerji • Bangalore, India • www.mmi-india.com
Posted by Anupam Mukerji at June 20, 2007 7:52 AM | Topic: change management |
2 Comments
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Good observations. I tend to disagree with your statement about women and youth. I have visited several cal centers in India (Delhi, Hyderabad, Chennai, Bangalore) all you see there is youth and women.
Completely agree with manufacturing industry, however the trend is now reversing if you see the recent chip manufacturing plan in south India and other related news.
I agree on your assessment of shortage of manpower. The other big issues India needs to tackle is the crumbling infrastructure and power situation. Delhi has metro which has cured some of its problem with traffic. Bangalore is getting one which will definitely help. All airports need some over haul, especially Bangalore needs the new proposed airport soon.
I agree on your assesment of shortage of manpower. The other biggest issues India needs to tackel is the crumbling infrastrcuture and power situation.
To increase the quality of the College graduates in India, first we need to concentrate on improving the quality of school education. We are still not able to educate our people, so that they would be able to think and communicate effectively.
This requires certain basic congnitive skills and literacy skills applied. They are ability to read and comprehend, write simple language clearly, speak and listen and perhaps do simple maths, so that they are able to communicate. Most of the jobs skills are not going to be permanent in the coming age. Life long learning is going to be the order of the day. Hence with these basic skills, we may be able to redeploy people to various jobs, train and manage. Instead of simply focusing too much on rote reproduction of advanced theoratical subjects, the educational institutes must emphasis on these basic skills. This does not mean that we should not concentrate on Higher learning or research. In fact, these skills are very essential in higher learning and managerial and leadership positions.
Without sound basic education at Schools, however much we try in higer education, we may not be able to produce quality human resources. Having interviewed and screened fresh graduates for so many years now, I can confidently say that there is clear divide between smart and not employable candidates. I have also found that there is a strong positive correlation between the quality school level performance and the quality of school and the performance / competence of the selected candidate. Even bright candidates who come from 'not so good schools' with very high college grades are not able to compete and perform well with candidates from good schools and candidates with good school level performance.
A J Balasubramanian