In The Spotlight

The employability crisis – how  can corporates help?

Bussines India Article, 03/2009, Ganesh Natarajan

The recurring theme in the Western world is the rapidity with which jobs are disappearing everywhere even as country after country falls prey to the steely grip of recession. With the large stimulus packages in the USA, UK and China failing to give the much needed boost to demand, the jury is still out on how soon US unemployment will hit double digit numbers. The deeper concern is of course whether the global job crisis will be redressed even when the upturn does happen or whether we will see the jobless recoveries that have characterised the last two recoveries. Daniel Thorniley of the Economist Intelligence Unit mentions key points that are causing uncertainty to policy planners in all developing markets and the dilemmas in India and also for the IT and Business services firms will surely resonate with his views. Put in five major buckets these concerns are….

• How deep and wide will the crisis be in the West and when will credit start flowing again?
• Will Western banks support their subsidiaries and encourage lending in emerging markets when they have their backs to the wall at home?
• What will happen to oil and commodity prices globally and which way will currencies swing?
• When will the unemployment charts look a little better and what will be the fate of infrastructure spending around the world?
• With the spectre of protectionism coming in the way of global free trade, will companies outsource more or less to emerging markets during this time?

The issue that concerns most Indians working in the high tech industry is the tightening of immigration and the flow of visa holders particularly to the US. Two pieces of legislation that were introduced in the 110th Congress (the previous one) in the US and did not pass were the comprehensive immigration bill and a more specific one that that would limit the number of H1B visas available to companies to a percentage of their total employment. In meetings with the teams of Senate Majority leader Reed who is widely expected to pilot the immigration bill this fall through the 111th Congress and the Durbin-Grassley Senatorial duo whose bill on visa limitations will hit the floor anytime soon, our sense is that while none of these are specifically targeted at the Indian knowledge worker community, this may well be the inadvertent outcome as a pro labour administration walks the tight rope between its focus on America and its desire to honour international commitments.
Closer home, there is a very real concern that with fifteen million young people hitting the job market every year, any prolonged slowdown in job creation can result in social discord and make many parts of the country look like sub Saharan Africa. In an attempt to find a permanent solution to the dilemma of employability for graduating engineers and IT graduates, an experiment launched in Western India to bridge the gap between vocational skills and industry expectations has started gaining traction and could well be the panacea for the ills that are beginning to plague professional education in the country. The Global Talent Track initiative is modelled on the German dual system where industry provides internships and practical experience to young students who get this experience even while they are in college.
The very successful German experiment which attracts funding of over twenty billion Euros every year from the Government is run by the chambers of commerce all over the country and focused on over three hundred vocations. To replicate this in India, the active collaboration of industry leaders with technology based education providers and the formal academic sector is required and funding will have to be provided by venture capital and private equity funds to supplement the largesse of the State and University Education funds. While the ITI experiment is yet to take off to provide real skills in the manufacturing sector in spite of many partnerships with CII members in various parts of the country, the transformation of professional education for the services industry – IT BPO Hospitality Healthcare, Retail, Media and Entertainment etc, is very feasible if industry comes forward with internship opportunities and projects, colleges and universities open their portals like Pune University has done to set up centres for vocational excellence available to all faculty members and students and well funded private education providers and technology partners put together the best courses that can be undertaken on full time or part time basis by graduates and college students respectively. The good news is that in many sectors the skill gaps are not huge – some corrective action taken today in the form of well designed learner centric education can capitalise on the lull that this year will surely witness and build the base for an order of magnitude improvement in employability in the years to come.