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Recently, theUnion Minister Jayant Chaudhary (MoS, Independent Charge – Ministry of Skill Development and Entrepreneurship, and MoS – Ministry of Education) unveiled the report "Skills for the Future: Transforming India’s Workforce Landscape", prepared by the Institute for Competitiveness (IFC). This data-driven report critically analyses India’s skilling ecosystem using PLFS 2023–24 and other datasets.

Significance of Skilling for India’s Development

• Demographic Dividend: India has one of the world’s youngest populations. Skilling is crucial to leverage this before population ageing sets in (by 2047).
• Economic Growth: A 1% rise in Gross Enrolment Ratio (GER) at the tertiary level increases GDP by 0.511% (Parika, 2020).
• Employment Creation: India needs to create 5 lakh non-farm jobs annually till 2030 (Economic Survey 2023–24).
• Global Competitiveness: Leadership in EVs, AI, biotechnology, and green energy demands a future-ready workforce.

Key Findings from the Report (PLFS 2023–24 Based)

1. Skill Distribution

• 88% of India’s workforce is in low-competency jobs (Skill Levels 1 & 2).
• Only 10–12% are employed in high-skill roles (Skill Levels 3 & 4).
• Only 4.5% of the workforce has received formal vocational training.

2. Education-Skill Mismatch

• Only 8.25% of graduates are in roles matching their skill level.
• Over 50% of graduates are employed in lower-skill jobs.
• Severe case of overqualification and underutilization of educational capital.

3. TVET and Sectoral Gaps

• Top 5 Sectors (66% of vocational enrolment):
  1. Electronics
  2. IT & ITeS
  3. Textiles & Apparel
  4. Healthcare & Life Sciences
  5. Beauty & Wellness
• Skill Deficits are critical in high-growth sectors like green tech, AI, biotech, and EVs.

4. Wage Inequality by Skill Level

Skill Level          Avg. Annual Wage

Level 1               Rs.98,835

Level 2              Rs.1.26 lakh

Level 3              Rs.2.81 lakh

Level 4              Rs.3.94 lakh

46% of the workforce earns less than ?1 lakh/year, highlighting a major economic disparity.

5. Regional Disparities

• Low-Skilled States: Bihar, Assam (95% in Skill Levels 1 & 2)
• Higher-Skill States: Kerala, Chandigarh
• Migration and brain drain observed in low-skill, low-growth regions

Challenges Identified

• Skill-Education Mismatch: Graduates in low-skill jobs; vocational roles filled by underqualified informal workers.
• Weak TVET-Industry Linkage: Existing courses not aligned with Industry 4.0 or green economy needs.
• Low GER and Transition Dropout: Higher secondary GER at 57.56%, tertiary GER still below 30%.
• Gender & Social Exclusion: Low skilling access for women, SC/STs, rural youth.
• Data & Outcome Gaps: No central skill repository or real-time job-skill tracking.

Recommendations from the Report

• Institutional Reforms
  • Launch a National Skill Gap Survey
  • Establish a Central Skill Data Repository for real-time, evidence-based policymaking
• Curriculum & TVET Overhaul
  • Update NCO codes (National Classification of Occupations)
  • Integrate vocational training in schools
  • Scale up PMKVY, NAPS, and credit-linked certifications
• Industry & Market Linkages
  • Incentivise hiring of certified skilled labour
  • Link industry wage structures to skill certifications
  • Encourage industry-led training programs
• Targeted Inclusion & Regional Empowerment
  • Empower State Skill Missions
  • Prioritise high-potential regions and sectors
  • Target women, SC/STs, informal sector workers
• Education Pipeline Strengthening
  • Raise GER at higher secondary and tertiary levels
  • Promote flexible, modular skilling programs for working populations and school dropouts