The Economic Survey 2024-25 has highlighted a significant skills mismatch in India’s labor market, revealing that over 53% of graduates and 36% of postgraduates are employed in roles below their educational qualifications. This disparity underscores the pressing need for reforms in the nation’s education and vocational training systems.
Key Findings:
- Skill Levels by Education:
- Individuals with primary or informal education exhibit limited specialized skills.
- Graduates and postgraduates demonstrate higher levels of specialized skills, yet a substantial portion remains underutilized.
- Skill Composition:
- Among those with primary education or less, 32.13% possess elementary skills, 66.3% are semi-skilled, and only 1.28% have specialized skills.
- In contrast, 38.23% of graduates and 63.26% of postgraduates have specialized skills, indicating a higher competency level.
- Employment Roles:
- A significant number of graduates and postgraduates are engaged in elementary or semi-skilled occupations, highlighting a mismatch between their qualifications and job roles.
Economic Implications:
The survey emphasizes that low-skilled workers present a key challenge, with inadequate educational outcomes contributing to a mismatch between academic qualifications and job market demands. Factors such as economic policies, technological advancements, globalization, and labor market demands are shaping the country’s skilling and employment ecosystem.
In light of global trends like automation, artificial intelligence, digitalization, and climate change, the survey stresses the importance of aligning India’s skill development initiatives with anticipated labor market transformations. The rapid pace of these changes necessitates a resilient and responsive skilled ecosystem to prepare the nation’s youth for emerging opportunities.
Income Disparities:
The survey also highlights a strong link between educational attainment, occupational roles, and income levels. Notably, 4.2% of the workforce with specialized skills earn between Rs.4 lakh and Rs.8 lakh annually, while 46% earn less than Rs.1 lakh, predominantly comprising low to semi-skilled workers such as agricultural laborers, clerical staff, factory workers, and small-scale service providers.
Call to Action:
To address these challenges, the survey advocates for a strategic plan focusing on skills and education to leverage India’s demographic dividend and achieve the ‘Viksit Bharat 2047’ goals. It recommends early vocational training to facilitate a smooth transition from learning to the job market, emphasizing the need for industry-academia partnerships, continuous skill development, and flexible learning models to create a globally competitive workforce.
By implementing these strategic interventions, India can better align educational outcomes with labor market demands, ensuring that its educated workforce is effectively utilized in roles that match their qualifications and skills.
