“India’s Education System Struggles to Bridge Skills Gap, Leaving Graduates Underemployed”
India’s Education System Struggles to Match Rapidly Evolving Job Market
India’s rapid development and vast youth population should theoretically provide a significant advantage in the global economy, but a major disconnect exists between the country’s educational outcomes and the labor market’s needs. Despite having millions of graduates each year, many highly educated Indians find themselves underemployed or unable to secure suitable jobs, highlighting a growing skills gap that continues to widen.
A recent survey in the India Skills Report 2024 sheds light on this issue. The report found that only about 51% of India’s graduates are considered employable, with the vast majority lacking the necessary skills to meet the demands of various industries. This is a significant improvement from 2014, when the employability rate was just 34%, but it still points to a critical mismatch between education and workforce readiness.
Experts argue that the problem stems from India’s education system failing to equip students with practical skills that align with real-world job requirements. Lekha Chakraborty, a professor at the National Institute of Public Finance and Policy, pointed out that simply having a degree is not enough to guarantee employment. Many graduates, especially in fields like engineering, are not “industry-ready.” Chakraborty emphasized that skills development and apprenticeships are key to making students job-ready, and without these, graduates often struggle to find work that matches their qualifications.
One sector that is feeling the impact of this skills gap is healthcare. Despite India having a large pool of trained doctors and nurses, there are still significant shortages, especially in rural areas. According to the latest figures, India needs almost 22,000 specialist doctors in community health centers but only has around 4,400 available. The mismatch between healthcare training and the actual needs of the population continues to worsen, making it difficult to provide adequate healthcare services in rural areas.
Furthermore, India’s youth unemployment crisis is disproportionately affecting educated young people. The India Employment Report 2024 highlights that nearly 83% of India’s unemployed workforce is aged 15 to 29, and of this group, two-thirds have completed secondary or higher education. Many of these young people are waiting for high-status “white-collar” jobs, often leading to delays in entering the job market. This “waiting game” for the ideal job prevents many from considering other employment options, thereby increasing the unemployment rate.
The issue also reflects the broader problem of insufficient investment in education and health sectors, according to Arun Kumar, a retired professor of economics. The government has failed to invest adequately in these areas, which are crucial for long-term economic success. Kumar argues that while India produces some of the best graduates in the world, there is still a huge gap in the skills required to address the country’s challenges. Moreover, recent reports on the state of education show alarming statistics: many young people in India, particularly those aged 14 to 18, cannot read basic English sentences or perform simple division, underscoring the deficiencies in foundational education.
This shortage of skills is compounded by a high dropout rate. The Annual Status of Education Report (ASER) reveals that while 96% of 14-year-olds are enrolled in school, by the time they reach 18, only about 67% stay in the system. This dropout rate has long-term consequences for the country’s workforce, further widening the gap between the number of educated youth and those with the skills needed to thrive in the job market.
India’s demographic dividend, which refers to the period when the working-age population is higher than the dependent population, could offer the country an economic boost. With the median age of the population at 28, India is on the brink of this demographic window. However, the country can only capitalize on this potential if it aligns its educational outcomes with market demands. Without addressing the skills gap, India risks squandering this opportunity for growth.
The government has started taking steps to address this issue. In the latest budget, initiatives to improve apprenticeships and skill development were announced, with the aim of helping 10 million young people over the next five years. While these reforms are a step in the right direction, experts warn that addressing the current skills gap is only part of the challenge. The future workforce will need to be equipped with skills that are adaptable to rapidly evolving industries and technological advancements, making it crucial to continue evolving the education system in line with market needs.
The situation is particularly pressing in sectors like healthcare and engineering, where the demand for trained professionals far exceeds supply. The medical field, for example, sees millions of applicants competing for a few seats in medical schools. With 2.5 million students applying for just 100,000 medical seats, the pressure is immense. Many talented students who don’t make the cut are left with limited opportunities, and the healthcare sector struggles to meet its staffing requirements.
For India to fully realize its potential and bridge the gap between education and employment, it must focus on creating a system that produces not only graduates but skilled professionals who are ready to meet the demands of the job market. Tracking training outcomes in real-time, updating curricula to reflect industry needs, and creating pathways for apprenticeships will be key to unlocking the full potential of India’s youth and ensuring the country remains competitive in the global economy.
