After establishing itself as an outsourcing hub, India needs to emerge as a reservoir of global talent.
Globalization and the outsourcing boom have undoubtedly transformed India. From a developing country, we are today an emerging economy and a superpower in the making. Over the last few years, India has clearly moved up the offshoring value chain—from being a low-cost destination, we are today known as a knowledge hub to the world.
But where do we go from here? The growth paradigm of the developed world requires fuel of another kind— knowledge workers and skilled professionals. The developed world’s requirement of skilled professionals is only going to increase with time. By 2020, the developed world will have a shortage of 40 million working people, says a report, “India’s New Opportunity—2020”, brought out by the All India Management Association, the Boston Consulting Group, the High Level Strategic Group and CII.
Rajendra S. Pawar is chairman of NIIT Ltd.
The developed world is already finding it difficult to find talent. A recent study undertaken by global HR consultancy Manpower Inc. “Talent Shortage Survey: 2007 Global Results” says 41% of employers worldwide are having difficulty filling positions due to lack of suitable talent available in their markets. The countries hit by this acute talent shortage are Costa Rica (93%), the US (62%), Japan (61%) and New Zealand (62%). Talent shortage appears to be least problematic in India (9%), Ireland (17%) and China (19%).
For the developed world, this is a serious matter. Manpower shortages can cripple economic growth. They can escalate wage rates, thus reducing the competitiveness of these nations.
For India, the workforce shortages in the developed world pose a huge opportunity. Despite the increase in jobs, educated unemployment in India is on the rise. By 2012, India could have an unemployed population anywhere in the range of 19-37 million, the largest share of which will be educated youth. By 2020, India is estimated to have a surplus working population of 45-50 million people.
With this surplus working population, it may appear that India has all it takes to bag the 40-million-jobs opportunity. However, the reality is far from that. India is facing a peculiar manpower paradox—while it is a young country (over 50% of its population is below 25 years), it is facing a shortage of skilled manpower, even domestically.
The manpower crunch in India is more serious than we think. The reason—while urban India has witnessed stupendous growth in jobs, many of India’s children still drop out from school, girls are still not sent to school and youngsters are forced to take up jobs instead of completing their graduation.