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The Hindu
11-06-2025
- Business
- The Hindu
India's employability crisis: Why degrees aren't enough for today's job market
Across India, academic milestones often arrive with high expectations and critical decisions. As students progress through the education system, whether completing school or preparing for college, they and their families are faced with choices that influence not just career paths, but also financial security, personal aspirations and social identity. In the midst of this transition, most conversations revolve around what to study next. However, there is a deeper and more urgent concern that often goes unnoticed. The real challenge India is grappling with is not just unemployment. It is the issue of employability. This concern is not limited to individuals or households; it affects industries, educational institutions and the nation's economic future as a whole. Let's look at the numbers. Every year, over 1.5 crore graduates enter India's job market. Yet the India Skills Report 2024 reveals that only 46% of them are considered employable by industry standards. The Centre for Monitoring Indian Economy (CMIE) reports youth unemployment standing at 16 percent, even as companies struggle to find candidates with the right skills. Clearly, the problem is not just a lack of jobs; it is a mismatch between what education produces and what the market needs. This mismatch is especially risky given India's youth bulge. With over 50 percent of the population under 25 and 65 percent under 35, India has one of the world's largest pools of working-age people. This presents a potential 'demographic dividend' that could propel the country toward becoming the world's third-largest economy by 2028. But if these young people are undertrained or underprepared, they risk becoming a demographic liability instead, fueling underemployment, frustration and even social unrest. Why the mismatch Why is this happening? Part of the issue is the rigidity of educational choices. For decades, students have followed well-worn academic paths: after Class 10, over 55% opt for Science (usually aiming for engineering or medicine), around 25–30% go into Commerce ( CA, BBA), and only 10–15% choose Humanities. After Class 12, most continue into familiar undergraduate programs, whether or not these truly match their abilities or interests. However, the fastest-growing job opportunities today are in emerging sectors: Artificial Intelligence, cloud computing, cybersecurity, fintech, biotechnology, digital marketing, green energy and agri-tech. According to National Association of Software and Service Companies (NASSCOM), India is expected to create 90 lakh new jobs in digital and emerging technologies by 2030. Yet fewer than 20 percent of students are actively preparing for these fields, partly because schools and colleges are still stuck in rote learning and outdated curricula. For instance, consider a student who graduates with a first-class degree in electronics engineering but struggles to find a job. It is only after completing a short-term certification in data analytics, a subject never covered during college, that they manage to secure a position at a tech startup. Stories like this reflect a broader reality and highlight the urgent need for India's educational institutions to move beyond textbooks and degrees, incorporating practical skills, internships, and industry exposure into the core of learning. The National Education Policy (NEP) 2020 emphasizes skill development and greater flexibility in learning pathways, aiming to better prepare students for real-world careers. However, its implementation has been uneven, particularly outside major cities. For many students, access to professional career counseling is limited or entirely absent. As a result, choices are often guided by family expectations or societal norms rather than a clear understanding of individual strengths, interests, or market trends. Unless students and institutions actively respond to the changing demands of the workforce, the promise of the NEP may remain unrealized. Studies by McKinsey & Company suggest that improving employability by just 10 to 15 percent could add between $200 - $250 billion to India's GDP over the next decade. At the same time, global reports from the World Economic Forum highlight that countries such as Japan, Germany, and South Korea are facing significant labor shortages due to aging populations. This creates a unique opportunity for India's young workforce to become a major exporter of skilled talent, but only if they are equipped with the right skills and training. To bridge the gap, India needs a coordinated national push. Colleges must build stronger industry partnerships for apprenticeships and problem-oriented projects. Platforms like Skill India and Pradhan Mantri Kaushal Vikas Yojana (PMKVY) must expand their reach, ensuring even rural students can access cutting-edge training. Families need to embrace lifelong learning, where upskilling and reskilling through short courses, online certifications, or modular programs, even for mid-career professionals. Strategy for students and parents For students at this crossroads, the key is to think beyond marks. Ask yourself: What are you passionate about? Where are the new opportunities? A student interested in Biology doesn't have to limit themselves to Medicine; they could explore Biotechnology, genetic research, health informatics, etc. Someone good at Math doesn't have to stick to Engineering; they could venture into data science, AI, quantitative finance, etc. And for parents: support your child's curiosity and adaptability. The most successful careers of tomorrow may be in fields that didn't even exist ten years ago. As the results season sweeps across India, let's widen the national conversation. It's not just about who scored how much, or who gets into which college. It's about whether we are preparing a generation that is ready, ready not just to find a job, but to shape the future of India. Because the real question isn't just 'What will you do after Class 10 or 12 or a degree?' It's 'How will you help build the India of tomorrow?
The Hindu
05-06-2025
- Business
- The Hindu
Corporate India's net profit grew 15.5% in Q4 FY25
Corporate India's net profit growth rate increased moderately to 15.5% in the fourth quarter of fiscal 2025, as against 14% in the year ago period according to data from Centre for Monitoring Indian Economy (CMIE). The profit after tax (PAT) as a share of total income was at 10.85% in the quarter ended March 2025. This was slightly more by one percentage point over the corresponding period of the previous quarter. The growth rate of income from sales slowed to 6.3% in the quarter-under-review from about 8.4% in the year ago period. Other income increased at a pace of 7% in Q4FY25 , much slower than the corresponding period in FY24, when it grew over 14%.CMIE gives data on corporate India's performance for more than 4,200 companies. To be sure, a larger and consistent sample of companies would increase accuracy. Total expenses increased marginally at a rate of 6.7% in the fourth quarter compared with 6.4% in the year ago period. While total expenses stayed flat, a disaggregation of the expenses show a different picture. Raw material and purchased finished goods cost grew at 6% in the quarter under review. This measure grew just 2% in the corresponding period last year. However expenses incurred on wages and salaries grew at a pace of 6.3% in Q4FY25 , among the slowest since fourth quarter of 2017. Expenditure on salaries and wages had grown 10.2% in the year ago period The net profit of Nifty 50 companies which are the most representative of corporate India grew just over 12.4% in the fourth quarter of FY25 as against a growth rate of about 24.5% in the same quarter last year. Equity analysts feel that the value of the stocks of companies across sectors are too expensive in valuations and may not justify their fundamentals.'We would note that valuations have stayed at high levels in several sectors and stocks despite meaningful earnings downgrades,' said analysts at Kotak Institutional Equities.
New Indian Express
27-05-2025
- Business
- New Indian Express
Tamil Nadu faces silent youth unemployment crisis amid unfulfilled job promises
In Tamil Nadu, we have long prided ourselves on being industrious, innovative, and aspirational. For decades, our state was a model of industrial development and social mobility — a place where hard work translated into upward progress. But today, that promise is breaking down. The unemployment crisis, especially among our youth, has become more than an economic issue — it is a quiet emergency that the current government has neither acknowledged seriously nor addressed competently. According to the Centre for Monitoring Indian Economy (CMIE), as of early 2024, Tamil Nadu's unemployment rate stood at 5.2%, higher than the national average. But statistics only reveal part of the problem. Under-employment, disguised unemployment, and the migration of skilled youth to other states and abroad reflect a growing erosion of opportunity, affecting lakhs of families. The ruling party touts its achievements through job fairs and the 2024 Global Investors Meet (GIM), claiming Rs 6.64 lakh crore in investment commitments and 14.5 lakh promised jobs. Yet, by April 2024, only Rs 13,000 crore had materialised and a mere 46,000 jobs were created — just over 3% of the original promise. These jobs, largely in MSMEs, often lack security, growth prospects, or adequate compensation. We are witnessing a dangerous gap between aspiration and accountability. The tragedy isn't just the unemployment rate — it is the collapse of public faith in government schemes as reliable engines of opportunity.
Indian Express
26-05-2025
- Business
- Indian Express
Express view on Index of Eight Core Industries (ICI) for April 2025: If these industries are not growing fast enough, the rest of the economy is unlikely to
The Index of Eight Core Industries (ICI) for April 2025 released by the Department for Promotion of Industry and Internal Trade shows that the monthly growth rate of the index fell to a nine-month low of just 0.5 per cent. In other words, the index grew just 0.5 per cent in April this year over the same month last year. This index comprises the eight most fundamental industrial sectors of the economy — coal, natural gas, crude oil, refinery products (such as petrol and diesel), fertilisers, steel, cement and electricity (with differing weights) — and it maps the volume of production in these industries. The eight core industries comprise 40.27 per cent of the weight of items included in the Index of Industrial Production (IIP). Since these eight industries essentially serve the role of a basic and/or intermediate ingredient in the functioning of the broader economy, this index's health is important to the state of the economy. The performance in April suggests a sharp loss of growth momentum relative to the preceding months. For instance, the index had grown by 4.6 per cent in March. In comparison, data from the index shows that of the eight industries, six experienced a weakness in growth momentum. The worst affected set of industries was refinery products, which incidentally have the highest weightage in the index (almost 30 per cent), as they clocked a negative growth rate (a contraction) of 4.5 per cent; it is the poorest showing since November 2022. Crude oil and fertilisers also witnessed contraction while the electricity index grew by just 1 per cent. Apart from the data for April, also noteworthy was the data for the full financial year that ended in March. In 2024-25, the core industries index grew by 4.5 per cent; this is the slowest increase since the post-pandemic recovery in 2021-22. At one level, the slowdown in April is understandable. The global economy received the shock of President Donald Trump's reciprocal tariffs and the ensuing surge of uncertainty has meant that most economic and financial metrics across the world have shown some impairment. However, the weakness, and especially the sharpness of it, and that too both in April and in the full year data for FY24, points to domestic causes as well. If these eight industries are not growing fast enough, the rest of the economy is unlikely to, either. Given the tepid start to the year, observers such as the Centre for Monitoring Indian Economy (CMIE) are dialling down the forecasts for both the June quarter as well as the full financial year. Readers and policymakers should watch out for two other data sets due to be released in days to come — the IIP and the GDP — to better understand the current state of the economy.
New Indian Express
25-05-2025
- Business
- New Indian Express
Wage share dips as profit share rises in India's GVA: NAS data
NEW DELHI: New estimates from the National Accounts of Statistics (NAS) show a slight increase in workers' compensation as a share of Gross Value Added (GVA), but a sharper and more sustained rise in profits over the past five years. GVA is calculated by adding compensation to employees, consumption of fixed capital, and operating surplus/mixed income, and then subtracting production taxes and adding subsidies. Among these, the operating surplus—essentially business profits—has grown significantly across most key sectors, including agriculture, mining, electricity, transport, and financial services. This rise in profits, however, has not translated into a consistent rise in wages. Nationally, the share of employee compensation in GVA dropped from 53.5% in 2019–20 to 51.85% in 2023–24. While compensation remained around one-third of GVA overall, it actually fell between 2022–23 and 2023–24. The biggest drop in wage share was seen in the electricity, gas, and water supply sector, followed by mining and quarrying. On the other hand, the real estate sector saw a small rise in compensation share, but the construction sector experienced a notable decline. This trend points to a shrinking wage bill alongside rising profits—raising concerns over growing inequality and weakening consumer demand. Economists often caution that such patterns, while possibly beneficial for short-term investment and inflation control, can reduce job creation and hurt overall employment growth. Adding to these concerns, the Centre for Monitoring Indian Economy (CMIE), an independent data agency, recently reported a dip in consumer sentiment, suggesting a potential slowdown in demand.
