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A study on skill development and productivity of the workforce in indian economy

Apica Sharma

This paper analyses the current scenario of skilled workforce of Indian Economy and future requirement of skill development. The paper also outlines skill gap in various sectors, the key issues and policy implications to address those issues and challenges in Skill Development and Productivity arena. Today, India is one of the youngest nations in the world with more than 62% of its population inthe working age group (15-59 years), and more than 54% of its total population below 25 yearsof age. Its population pyramid is expected to bulge across the 15-59 age group over thenext decade. It is further estimated that the average age of the population in India by 2020 willbe 29 years as against 40 years in USA, 46 years in Europe and 47 years in Japan. In fact,during the next 20 years the labour force in the industrialized world is expected to decline by4%, while in India it will increase by 32%. This poses a formidable challenge and a hugeopportunity. To reap this demographic dividend which is expected to last for next 25 years,India needs to equip its workforce with employable skills and knowledge so that they cancontribute substantively to the economic growth of the country.As India moves progressively towards becoming a global knowledge economy, it must meetthe rising aspirations of its youth. This can be partially achieved through focus on advancementof skills that are relevant to the emerging economic environment. The challenge pertains notonly to a huge quantitative expansion of the facilities for skill training, but also to the equallyimportant task of raising their quality.Skills development is the shared responsibility of the key stakeholders viz.Government, the entire spectrum of corporate sector, community based organizations, thoseoutstanding, highly qualified and dedicated individuals who have been working in the skilling andentrepreneurship space for many years, industry and trade organisations and other stakeholders.The policy links skills development to improved employability and productivity in paving the wayforward for inclusive growth in the country. The skill strategy is complemented by specific effortsto promote entrepreneurship in order to create ample opportunities for the skilled workforce. Skilling need to be an integral part ofemployment and economic growth strategies to spur employability and productivity. Coordinationwith other national macroeconomic paradigms and growth strategies is therefore critical.

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