Skilling Investments in India’s 10 Most Employable States

The economic downturn in the face of the pandemic calls for bolstering of skill development for higher employability. According to the latest report on the talent demand and supply in post-COVID India, Rajasthan and Madhya Pradesh were among the top states to have available skills in English as a second language.

Rajasthan topped the list for states with available skills in critical thinking and computer skills. Yet, students from these states did not have a higher employability rate as opposed to states like Maharashtra, Tamil Nadu, Uttar Pradesh, Karnataka and Andhra Pradesh sealing top 5 spots for youth employability, according to The India Skills Report 2021 by Wheebox. Created in partnership with Taggd, CII, AICTE, AIU and UNDP, this report is a combination of an assessment of 65,000 candidates from across India, who appeared for the Wheebox National Employability Test (WNET).

Skilling investments in top 10 States

Which are the top States for youth employability and what are they doing for skill development?

1. Maharashtra

The Gross State Domestic Product (GSDP) of the state of Maharashtra for 2020-21 is estimated to be around Rs. 32,24,013 crore. This is a steady 12% increase from the revised estimate recorded during 2019-20. In the year 2015, the government formed the Department of Skill Development and Entrepreneurship to facilitate the vocational training and livelihood promotion activities within the State.

As a top destination for work in the formal and informal sector of the economy, Maharashtra stands out as a highly employable talent supply. The Pramod Mahajan Kaushalya and Uddyojakta are examples of other skilling investments taken by the State to promote sustainable employment and employability. The Vikas Abhiyaan (PMKUVA) is a flagship State programme that offers free skill training to youth through Industrial Training Institutes (ITIs) and onboarded private vocational training organizations.

In terms of the number of students trained in vocational courses (150000), Maharashtra is the leading state. Sources verify that over 50% of the beneficiaries of PMKUVA are women. An amount of Rs. 85,77,62,615 each for the year 2016-2020 was approved by MSDE towards the implementation of PMKVY (2016-2020). However, in comparison to the massive funding, only 7,30,522 candidates have been offered jobs through the programme. Nevertheless, Maharashtra remains the top state to work, considering employment opportunities and qualified labour.

Maharashtra did not make it to the top 10 states with a high percentage of available female employable resources. Considering that a massive population of women are benefiting from various government skilling activities, the State should record more employable women towards the year 2021 and beyond. With an overall high employability score, cities like Mumbai and Pune are making way for fresh employment opportunities.

2. Tamil Nadu

The Government of Tamil Nadu has created the Tamil Nadu Skill Development Corporation (TNSDC), a nodal agency to establish the skills development initiatives in the state. Under this, 227,106 youth have been trained until 2019. Owing to the global pandemic, the attendance in various skill programs had dropped during 2020. However, the Tamil Nadu government has spearheaded numerous other initiatives to upskill the workforce and meet demands of rapidly growing Chennai and Coimbatore cities.

The Government of India started ICT Academy of Tamil Nadu (ICTACT) in 2009 under the PPP model to bridge the industry-academia skill gap. It undertakes various initiatives such as faculty development, skill development, youth empowerment, entrepreneurship development, research and journal development, industry-institute interaction and digital empowerment.

In addition to the state government efforts, the Government of India has sanctioned an amount of Rs. 68,86,21,441 for 14 sectors each, for 2019-20 towards the implementation of activities associated with PMKVY (2016-20). Out of 1,56,168 candidates trained under PMKVY 2016-2020 scheme, 55% of the short term trainees got employment from 450 training centres.

The skilling investments by Tamil Nadu have uplifted its position as one of the most employable states in India. Besides being the preferred place to work for both males and females, places in Tamil Nadu like Salem and Coimbatore show a significantly higher employable population of women than Chennai. Additionally, the least number of candidates seeking an internship were from Tamil Nadu, also a place from where the highest percentage expected a remuneration between Rs. 2-2.5 lakhs per annum.

The conclusive idea is that increased access to technology and an increasing number of opportunities in cities like Chennai, Salem and Coimbatore are rapidly shaping a favourable employability landscape for Tamil Nadu.

3. Uttar Pradesh

Uttar Pradesh has contributed over 8% to India’s GDP during the global pandemic. It has a large base of skilled labourers and has emerged as a key hub for IT and ITeS industries including software, business process outsourcing (BPO) and electronics. The UPSDM programme was implemented by the government in 2013, to provide training for the youth in electrical, healthcare, construction and wellness industries.

To further strengthen the skills ecosystem, the UP government opened two new Skill Centres of Excellence in UP, tackling the requirements for plumbing and other services. India Institute of Skills in Kanpur, collaborated with the Institute of Technical Education, Singapore offering a venue for technical education in the state. For skilling investments in UP, amount of Rs. 52.26 crores was sanctioned by the Government of India towards implementation of components of PMKVY for 2016 – 2020. The MSDE further approved an amount of Rs. 208.04 crores for the period of 2016-20, to be sanctioned equally over a 4 years period. This has resulted in successfully placing 10,65,458 trainees into respective job roles.

Yet, the ratio to funds allocated is not very encouraging, considering UP was sanctioned the largest amount for skill development by the Central government. Only a meagre 24% candidates trained under short term training and 42% of candidates trained under special projects got employment from 660 training centres.

Skill development in line with the PMKVY government initiative gathered a better response from UP, among the top states ranking for employment due to the funds allocated. Also, 90% of the test takers of the WNET survey reported owning a computer at home, recording one the highest figures, after Karnataka, Delhi, Telangana and Haryana, all above 90% in terms of access to a computer. This is a direct impact of the state’s investment in IT infrastructure over the past 5 years. As the pandemic took its toll, the connectivity enabled by the internet has clearly impacted the skilling process of the state, owing to the access to technology.

4. Karnataka

Karnataka has a robust economy that is flourishing with the urbanization through national and international investments. Karnataka is the IT hub of India and home to the fourth-largest technology cluster in the world. With 55% of the population in the working age group of 20 to 59 years, Karnataka has an opportunity of achieving faster economic growth through favourable demographic dividend, by promoting skill development of the working population in general and youth in particular.

The government of Karnataka has dedicated resources to specialized skills development required to propel its economy. In the 2020 year budget allocation, under the Chief Minister’s Kaushalya Karnataka Yojane (CMKKY), the government allocated Rs. 100 crores for CMKKY to impart industrial training to 80,000 new candidates, while Rs.40 crore has been set aside for upgrading the skills of 25,000 women workers belonging to scheduled castes and scheduled tribe communities.

The Karnataka Government strives to effectively implement schemes rolled out by the Government of India. One such flagship programme is PMKVY, which had sanctioned an amount of Rs. 43,99,20,000 for the period of 2016-2020. The statistics of funds deployed vs the outcome achieved has not been the best performance. In fact, 3,14,577 were trained and oriented during this period, where the expectations were much higher for one of the fastest-growing state economies. The placement under special projects recorded the highest number of placements, with 70% of trainees getting a job in the subsequent year, a figure estimated at under 9,000 people.

Assessing the economic dividend of funds allocated and skilling equipped, the government didn’t have the biggest role. According to the WNET survey, Karnataka came 7th out of 10 of the top states for computer skills. Considering the economy is an IT hub in India, these numbers are way below par. However, for English as a second language and Numericals, Karnataka is in the top 10 states with qualified candidates.

5. Andhra Pradesh

Andhra Pradesh has been developing its social, industrial and physical infrastructure over the past 5 years. Becoming the first state to reserve 75% of jobs in industrial units and factories for the local youth has set a benchmark to follow. By contributing 9.73 lakh crore rupees in 2020, the economy is estimated to grow at 12.73% at current prices. Ranked as #1 in India for ease of doing business rankings, the State also spearheaded numerous skill development programmes during 2020.

The Andhra Pradesh State Skill Development Corporation (APSSDC) was founded in 2014 with a vision to upskill the workforce and increase employability. Skill development in this State is also focused on promoting entrepreneurship and industrial growth within the state.

Since its bifurcation into Telangana and Andhra in 2014, Andhra Pradesh has significantly reformed the skilling landscape to urge local businesses and promote employability through employment opportunities and skilling investments. In line with the PMKVY (2016-2020) skilling mission, an amount of Rs. 35,52,79,392 for 2018-19 and 2019-20, was approved by the MSDE. It is estimated that 60% of trained candidates were placed from short term training programmes, while 40% of the special projects gained jobs.

Andhra Pradesh is one of the most favourable destinations for candidates to work in the WNET survey. The State also houses the 5th largest percentage of highly employable talent. This is not only an indication of the massive strides taken to develop the state’s infrastructure, but the inclusion of numerous startups, businesses and local industries coming into play.

6. Delhi

Delhi is one of the fastest-growing union territories of the country. The Delhi government, under its Department of Social Welfare, has formed the Delhi Skill Development Programme (DSDP) to provide employment-related skills to aspiring candidates. The skills are imparted in smart centres by certified training partners approved by the NSDC (National Skill Development Council). According to NSDC, 80% of the trained candidates will be offered employment through networking by the training partners.

In terms of skilling investments, the Government of India approved an amount of Rs. 54,66,00,600 each for the years towards the implementation of PMKVY (2016-2020). The skill development goals cover training, specializations and projects to employ its workforce and make aspiring professionals more employable.

Delhi does not feature in the list of highly employable female workforces while not appearing on the list of top 10 states with employable male candidates either. However, Delhi is listed among the top 10 cities with high employability among the candidates who took the WNET survey. It also ranked #1 on the top 10 list of users who own a computer at home. Considering the most valuable communication technology being the internet, this is a hopeful indicator for one of the most vibrant economic hubs of India.

7. Telangana

This State has emerged as one of the top 10 employable states, standing at 7th with 41% employability rating, followed by Gujarat, West Bengal and Rajasthan. Telangana’s nominal gross state domestic product for year 2020-21 is recorded at Rs. 11.05 lakh crore. Paired with a steady growth curve, these figures are estimated to increase. The state is gradually becoming a centre of various global companies with the development of Hi-tech city in Hyderabad.

In its budget of 2019, the government introduced an unemployment allowance of Rs. 3,016 per month to the eligible, totaling Rs 1,810 crore for FY ending 2020. This reformative step was commended by the international and national media for promoting sustainable welfare. As for skilling investments, the Government has formed Telangana Jagruthi Skill and Knowledge (Tj Skill) under National Skill Development Corporation of India (NSDC) and organization TASK (Telangana Academy for Skill and Knowledge).

Hyderabad city stands out as the city with the highest employability rating among all top cities recorded in WNET. As part of the PMKVY scheme, the MSDE approved funds of Rs. 27,53,44,124 for 2019-20, as part of the 2016-2020 skills development activities. Compared to the funds allocated, only 2,28,745 were recorded to have been placed in job roles in the state. However, the investments in IT and industry have grown over the years, with IKEA furniture establishing its first enterprise of India in Telangana. Google, Microsoft, Amazon, Accenture and numerous other top MNCs have established Hyderabad as their base for operations.

With the increased opportunities, Hyderabad is in the middle of rapid urbanization. It was affected by the COVID-19 pandemic when the rapidly growing economy lacked the generation of a skilled talent pool to meet the demands. The impact was short-lived as Telangana is estimated to grow faster than any other state in the coming year.

8. Gujarat

Gujarat is one of the leading industrialised States in all of India. As part of its skilling investments, the State initiated the Gujarat Skills Development Mission (GSDM) that continues to perform with social organizations and the government with the aim to make the workforce more employable. For the year 2019-2020, funds worth Rs. 1573.12 crores were released in alignment with the PMKVY.

Under the DDU-GKY scheme, 4.39 lakh candidates were trained during the 2018-19 and 2019-20, of which 84,156 people belong to Scheduled Tribes. Under the PMKVY 2016-20, a reported number of 49.67 lakh candidates were trained during the 2018-19 and 2019-20, of which 2.13 lakh candidates are from Scheduled Tribes. The success rate of placements is not encouraging considering the funds allocated over the period of 5 years. This has resulted in placing 2,39,202 candidates with jobs through the programme. On the other hand, the WNET survey identified Gujarat among the top 10 states with the most employable resources in the country. This statistic is in tandem with the development in infrastructure, social, economic and physical growth of the state.

9. West Bengal

West Bengal has contributed 12.58% to India’s GDP consistently over the past 3 years. The year of the coronavirus outbreak wasn’t far behind. The state recorded an estimated GDP of 12.54 lakh crore in the year 2020. An abode of cultural significance, the State established Paschim Banga Society for Skill Development (PBSSD) with focus on a coordinated manner to provide vocational training and education for skill development towards sustainable employment for its people.

The Utkarsh Bangla Scheme launched by West Bengal Chief Minister is a flagship programme of the State, which aims to train 6 lakh people every year. Considering the drastic changes in the employability landscape of India during 2020, the scheme has allocated Rs. 1,106 crores to technical education, training and skill development during the year 2020.

The State won the SKOCH Award for in-house skilling investments. Government of India, MSDE approved an amount of Rs. 38,04,64,812 for 2016-2020 towards implementation of the PMKVY plan until 2020. About 50% got placements through the PMKVY for short term training, while a meagre 13% acquired a job after the special projects training. A total of 2,96,092 trainees achieved job offers through the skill development programmes in West Bengal. Considering the employability index, West Bengal is among the top 10 states with access to English as a second language and comes second in the list for computer skills. The State also appeared among top 10 states for employable females that stood at 18.87%.

10. Rajasthan

The Rajasthan government has opened a first of its kind Skills University. Since July 2018, 60 skill development institutions have been affiliated and more than 3000 students are undergoing specialized training.

The response to Pradhan Mantri Kaushal Vikas Yojana (PMKVY) has identified Rajasthan as a key operational area. For the year 2019-20, MSDE, the government approved Rs. 33,11,71,776 for skilling investments. Owing to its successful first-year implementation, the Union Cabinet approved the Scheme for another four years (2016 – 2020) to impart skill to 10 million youth of the country. As the year 2020 came to a close, a total of 6,43,544 have been trained in Rajasthan within the four-year tenure. The statistics are not extremely hopeful, but an indication of the government’s efforts and skilling investments in utilizing the talented workforce of Rajasthan.

Rajasthan came as the top state with available resources in critical thinking skills among students. In the WNET survey, the State stood first in the list of business communication competencies among all states. The state also topped critical thinking skills availability. Although the statistics of deployment of funds vs outcome has not been very encouraging, the local bodies and industrial advancements seem to be paving the way forward. Rajasthan is also listed as the top state with percentage of test takers well-versed in their computer skills.

Although the global pandemic did not favour the employment of Rajasthan’s talented workforce, the coming years are to witness a surge in the employable candidates from this State. Rajasthan has the highest number of employable females with 46.18% being highly employable.