Vocational training likely to grow several fold by 2026

Updated on: Wednesday, July 13, 2011

With 11-13 million Indians striving to become employable every year, skill development and vocational training may become a USD 20 billion per annum market in the next 15 years, a latest report has said.

"We expect 11-13 million people to look for employment opportunities every year over the next 15 years. They will seek vocational training programmes that will give them these skills. We estimate the value of vocational training opportunity at USD 20 billion annually," Kotak Institutional Equities Research said in the report.

Automobile, building and construction, textile and organised retail etc, along with unorganised sector would propel the demand for skilled labour, it said.

The current capacity to train or provide vocational skill is around 4.3 million a year, the report said without giving the size of the industry now in value terms.

The changing dynamics in the labour market - a move away from agriculture to organised sector; a more knowledge and training-based workforce than just application of traditional skills and a gravitation to urban India for work from rural
areas - are also propelling the demand for skill development.

The big challenge, however, is designing a model for the industry that benefits both learners as well as the training institutions, it said. The country has one of the largest labour pools in the world and this is expected to increase as India's demographic pidend kicks in.

"Preparing the economy to absorb the large mass of population coming into the workforce requires ensuring that they are skilled to meet the requirement of the sectors that will employ them," it said.

India will add significantly to its labour pool and even as the median age bucket rises by 2026-26, it will still be at a relatively young 30-34 age bracket.

For the government as well, the skill development is a priority area. It has set up National Skill Development Corporation in 2009 and provided Rs 1,500 crore to it by way of seed capital to fund training ventures.

Many countries, especially in Latin America, have missed the opportunity to convert their demographic pidend into a meaningful force for economic growth, the report said.

"With its large population base, India cannot afford to let this pass - a mass of unemployed youth can be a threat to social stability," it warned.

Vocational training likely to grow several fold by 2026

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