Reform education, labour and put Karnataka to work

William Beveridge, the 19th century British economist, once famously said that unemployment is like a headache or a high temperature -- unpleasant and exhausting but not carrying in itself any explanation of its cause.

India’s economy, over the last decade, has been impacted by increasing joblessness. Job deficit  coupled with skills deficit is a combination that is adding more than a million ‘educated’ youth each month to the unemployment list. Matching jobs, skills and employment is the critical need of the hour. That skills development of the Indian youth is a priority for the government is evident by the progress made over the last few years. However, 29 chief ministers can do much more than one prime minister.

Karnataka, the IT capital of India, is renowned for its entrepreneurial spirit and has very quickly grown to be the ‘Start-up Capital’ of the country. It houses a few of the best new-age organisations such as Flipkart, Amazon, Ola, etc. Karnataka’s Human Development Index and per capita income has shown a consistent increase over the last three decades. With over 75,000 schools, 1,777 ITIs and over 200 Engineering colleges with a seat capacity of over 1.25 crore learners per annum, Karnataka needs to recognise the importance of providing education and skills for improved productivity, employment growth and development.

Most would agree that jobs change lives in a way no subsidy can, but the debate continues as to whose job it is to create jobs and provide skilled labour. Creating an independent Skills Department recently under the aegis of the chief minister was a welcome first step. With the right focus to developing skills and employment, labour market entrants will have a stronger future. Decent employment is the single most important factor in an economy: poverty, nutrition, social unrest, consumer confidence and spending, income tax revenues, corporate profits, and a host of other variables depend on it.

Three Focus Areas

Employment: The fastest route and the lowest hanging fruit for the state is to be able to create adequate and well-paying jobs. Jobs can be created by providing better infrastructure, uninterrupted power and, last but the most important, by creating an enabling environment for doing business.

Karnataka has over 29,000 villages, of which many have less than 1,000 people. Industries cannot be asked to set up shop there. But the state also cannot afford to bring in more people to cities such as Bengaluru, Mysuru or Hubballi. Instead, it needs many “smart cities” that not only provide adequate infrastructure or hardware, but also have effective governance, public transport, waste management systems, and much else. You need to take jobs to the people and not people to jobs.

Changes to some of the labour laws will enable India Inc. to provide employment to many more job-seekers. The state should develop an agenda, breaking it up into five phases: (i) Definition/Plumbing, (ii) Benefits regime, (iii) Trade unions, (iv) Decentralisation, and (v) Fixing the employment contract. Karnataka should amend labour laws keeping in mind local needs. What works in Delhi may not work in Bidar.

Education: At the lower and higher primary school level, only 30% of schools are privately run.  However, at the high school level, over 65% of the schools are private schools. Karnataka should focus on increasing the number of schools across all levels, revamp their hardware (infrastructure, facilities, etc) and software (curriculum, management, etc), introduce innovative teaching, learning and assessments, use technology for teaching and management purposes, bring in SMEs to teach students, develop teachers’ capacity, upgrade and certify existing teachers. For a state that has a teacher strength of about 90,000, an evident shortfall of over 30%, and spends around Rs 22,000 annually for each student, Karnataka will need do a lot more than maintain status quo.

Fixing school education is key in the new world of work because reading, writing, arithmetic and soft skills are emerging as the most important vocational skills, and Class 12 is becoming the new Class 8 for lazy employer-filtering. Karnataka should take the first step and provide ‘Right to Learn’ to all learners. The state should make provisions for these students to be able to learn at least two skills while they are within the education system that would make them employable once they are ready to move out to the job market.

Including English language across school, higher and technical education would make the youth more prepared to face the corporate world. This is clearly a gap area.

Employability: There is a crying need to develop a large base of “skilled” employees before they enter the labour market. However, not much has been done in this regard. Karnataka should set up an ‘Apprenticeship Corporation’ which would become the nodal agency to provide academic credit to all apprentices and expand the number of apprentices.

For its 24 employment exchanges, Karnataka has the challenge of breaking the difficult trinity of cost, quality and scale. Jobseekers and employers have a matching problem because of geography, time, and low signalling value of education. The matching problem is amplified by rural youth coming from agricultural households who have no role models to base their ideas and ambitions of what they want to do or intellectual frameworks about how a modern economy works. The long-term solution is more rural non-farm job creation. But an interim solution could be fixing the 24 employment exchanges on which thousands of people register, but few get jobs. Upgraded career centres should offer counselling, apprenticeships, assessments, training and job-matching.

A ‘Skills University’ –- part ITI, part career centre and part college – focusing on job-oriented courses and with multiple entry and exit options would be a good investment for the state.

Skill development, education and labour reforms can transform Karnataka and help state provide meaningful employment to a population over half of which is under the age of 25. It is time the state took advantage of these factors.

(The writer senior vice president, TeamLease Services)