Vocational education and training in India: challenges, status and labour market outcomes

Abstract This paper provides an overview of vocational education and training (VET) system in India, and discusses various challenges and difficulties in the Indian VET system. The paper also examines labour market outcomes of vocational graduates and compares these with those of general secondary graduates using a large-scale nationally representative household survey. We find quite a high rate of unemployment (11%) for VET holders in the age group 15–29 years. Although unemployment rate of VET holders is higher than the overall unemployment rate in the same age group, the rate is lower than that for general secondary graduates. We show that average daily wages are higher, both for regular and casual workers, for VET holders. There has been a considerable increase in the number of Industrial Training Institutes/Centres in the last decades, but the coverage of the system is disparate in terms of institutes' vis-à-vis states. Keywords: vocational education and trainingskill developmentemploymentwagesIndia Acknowledgements I thank Sripad Motiram and S. Chandrasekhar for comments and suggestions. I am also grateful to two anonymous referees of this journal for helpful comments. Notes 1. Unemployment rates (proportion of unemployed workers in the labour force) are based on household surveys conducted by the NSSO and are estimated on the basis of current daily status. Labour force includes both employed and unemployed persons. 2. Unemployment rates on the current daily status basis. The corresponding figures on the basis of usual principal status are 2. 6, 2. 8 and 3. 0%. 3. The growth rate of the labour force between 1999–2000 and 2004–2005 was 2. 84% per annum, whereas that of the workforce (employed persons) was 2. 62% per annum. 4. Source: http: //www. ficci. com/Sedocument/20165/FICCILabourSurvey. pdf (last viewed on 25 October 2011). 5. The corresponding percentages for those graduating from ITCs were 22. 8, 35. 6 and 21. 3. 6. ITIs are financed and managed by state labour ministries, whereas ITCs are owned, financed and managed by private organisations or non-governmental organisations (NGOs). 7. The part-time courses are offered mainly for those individuals who are unable to attend the classes in the day time or on the regular basis. 8. The MHRD and MoLE are the major ones. See, Appendix 1 for the details. 9. Some pre-vocational education programmes are also offered at the lower secondary stage (classes 8–10). 10. Some examples of vocational education courses are dairying, farm machinery and equipment (Agriculture) ; accounting and auditing (Business and Commerce) ; electrical technology, air conditioning and refrigeration (Engineering and Technology), X-ray technician, health care and beauty culture (Health and Para Medical) ; and preservation of fruits and vegetables, food services and management (Home Sciences and Humanities). A student can choose any course based on the availability of the course in school. Each course has different vocational subjects (both theory and practical). 11. At the national level, Directorate General of Employment and Training (DGE GoI Citation2009b, 340–1). 15. 'SSA' is a Hindi phrase which means 'The Education for All Movement'. 16. For example, Gross Enrolment Ratio in 6–14 years age group increased to 114. 61 in 2007–2008 from 96. 3 in 2001–2002 and drop-out rate has reduced by to 25. 55% in 2007–2008 from 39. 03% in 2001–2002 at the primary level (Source: GoI Citation2009b, 23–4). 17. This does not imply that VET should be seen as a substitute for higher education. 18. The dependency ratio is the ratio of non-working (dependent) to working age population. 19. The total number of ITIs is 8709 out of which 8511 are verified. Number of ITIs in the government and private sectors are 2005 and 6704, respectively. Verified ITIs are those ITIs for which verification regarding norms/trades and standards as laid down by the National Council of Vocational Training have been completed for the purpose of affiliation (source: http: //dget. gov. in/lisdapp/nvtis/nvtis. htm, last viewed on 1 May 2011). 20. The 1244 polytechnics include only those offering diploma courses in engineering. In addition, there are 415 institutions for diploma in pharmacy, 63 for hotel management and 25 for architecture courses. 21. The corresponding figures for other countries like Russia, China, Indonesia and Korea vary from 30 to 60% (World Bank Citation2008). In India, two per cent of existing workforce has received skill training but in industrialised countries like Germany, Japan, Korea and UK, this figure is between 68 and 96%. 22. This figure does not include vocational training. 23. The classification of the states in four regions, i. e. northern, southern, eastern and western is based on the classification followed by DGE and the training has some entry-level eligibility in terms of age and minimum qualification. 27. The status in which some economic activity for 30 days or more (not necessarily for a continuous period) is pursued during the reference period of 365 days preceding the date of survey is the subsidiary economic activity status of the person. 28. Labour force constitutes all the persons who are either working (engaged in economic activity) or seeking or available for work. Thus, it constitutes both employed and unemployed persons. 29. In case, if an individual has both VET and General education, he/she is considered under VET group. 30. The work status of labour force is not shown in the table. 31. See e. g. Swaminathan (Citation2005) and GoI (Citation2008b). 32. It would not appropriate here to discuss the outcomes of the group receiving formal training since their education is incomplete. Thus, we discuss the outcomes for the other two groups, i. e. those who have received formal training and non-formal training. 33. The term 'factory' has a specific meaning. The total number of factories in the country is 155, 321 as per the Annual Survey of Industries survey, 2008–2009 (GoI Citation2011). The surveys are conducted by the Ministry of Statistics and Programme Implementation, GoI. The survey excludes the four states namely: Arunachal Pradesh, Lakshadweep, Mizoram and Sikkim. 34. In the other two regions the shares are 25% (Northern) and 28% (Western). 35. The total numbers of institutions of higher education in the country were 28, 135 in 2007–2008 (GoI Citation2009b). The southern region shares 35%, eastern region, 15% and the other two regions 25% each. 36. NCO is a coding scheme for occupations in India prepared by the DGE&T. NCO 1968 is the most commonly used NCO and is based on the International Standard Classification of Occupation (ISCO) 66 code structure. NCO-1968 comprises four components namely: division, group, gamily and occupation. There are eight divisions, 95 groups, 950 families and around 2500 occupations. 37. A related point worth mentioning is that no tuition fee is being charged from SC/ST students and people from disadvantaged groups in the ITIs. 38. It may be noted that there are VET programmes for adults too. However, the information on adult skills or retraining agenda is not readily available.