Bridging Global Workforce Gaps

Bridging Global Workforce Gaps

Why in News?

The India Employment Outlook 2030 report by the Observer Research Foundation (ORF) has highlighted that India will contribute around 24.3% of the incremental global workforce over the next decade, underscoring its pivotal role in the global labour market.

Global Labour Market Trends

1. Declining Working-Age Population in High-Income Nations 
   • Many developed nations are witnessing shrinking birth rates, leading to a decrease of over 92 million in their working-age populations by 2050.
2. Rapid Aging in Developed Countries 
   • The number of people aged 65 and above will increase by over 100 million in high-income countries.
   • This creates a challenge for sustaining pension and healthcare systems, requiring a steady working-age population to support financial stability.
3. Globalization of Job Markets 
   • Increasing digital connectivity and acceptance of remote collaboration has enabled cross-border employment opportunities.
4. Shifting International Trade Patterns 
   • The rise of trade restrictions, friendshoring, and geopolitical shifts is reshaping job markets and wage structures globally.

India’s Demographic Advantage

1. A Young and Expanding Workforce 
   • With a population of over 1.4 billion, nearly 65% fall within the working-age category (15–64 years), and 27% are between 15 and 24 years.
   • This offers India a significant surplus labour force to cater to the labour demand in advanced economies.
2. Bridging the Global Skill Gap 
   • The Global Skill Gap Study by the National Skill Development Corporation (NSDC) identifies high demand for Indian workers in nations like UAE, Saudi Arabia, Germany, Netherlands, UK, Australia, Canada, and the USA.
3. Dual Economic Advantage 
   • With a median age of 28.4 years, India benefits from both a strong workforce and high domestic consumption potential.
4. Previous Success in Global Employment 
   • India has successfully leveraged its workforce in IT and BPO services, serving as a blueprint for further global integration.

Impacts of Labour Mobility

1. Boosting Global Productivity 
   • Facilitating labour migration can help address workforce shortages in high-income nations, enhancing productivity and economic equity.
2. Poverty Reduction 
   • Workers migrating to developed nations experience a 6 to 15 times income increase, helping reduce poverty.
3. Social and Economic Benefits 
   • Remittances play a key role in enhancing healthcare, education, and infrastructure in migrant-sending countries.
   • In 2022, India received over $111 billion in remittances, becoming the first country to surpass the $100 billion mark.
4. Potential Challenges for India 
   • Mass migration of skilled workers can lead to brain drain, particularly in healthcare and construction sectors, impacting domestic skill development.

Initiatives to Leverage India’s Workforce Potential

1. Skill Development Programs 
   • The Ministry of Skill Development & Entrepreneurship has introduced initiatives like:
     • Skill India Mission
     • Pradhan Mantri Kaushal Vikas Yojana (PMKVY)
   • National Education Policy (NEP) 2020 incorporates vocational education from school level.
2. Migration and Skill Training Agreements 
   • India has signed labour mobility and skill training pacts with countries such as Italy, France, and Germany to facilitate structured workforce migration.

Challenges in Labour Mobility

1. Impact of COVID-19 
   • The pandemic led to significant job losses, particularly for low-skilled migrant workers, increasing debt burdens.
2. Anti-Immigration Policies & Sentiments 
   • Many high-income nations impose restrictive immigration policies, making migration difficult.
3. Complex Immigration Procedures 
   • Stringent and complex visa processes discourage potential migrants.
   • Lack of effective integration programs hinders migrant adaptation in host countries.
4. Technological Disruptions 
   • Automation, AI, and Industry 4.0 are reshaping job markets, reducing demand for low-skilled workers.

Way Forward

1. Strategic Workforce Planning 
   • India must align its labour supply with global demand, focusing on high-income nation job markets.
2. Skilling and Education Reform 
   • Investments in education, vocational training, and skill enhancement should align with global employment standards.
3. Strengthening International Agreements 
   • Bilateral and multilateral migration agreements must be enhanced for smoother labour mobility.
   • Simplifying immigration procedures and providing migrant support services can increase accessibility.
4. Public Awareness Campaigns 
   • Addressing negative perceptions of migration and emphasizing its economic benefits can create a more favourable environment for labour mobility.
5. Encouraging Women’s Workforce Participation 
   • With female labour participation at 24% (ILO, 2022), efforts should focus on boosting women’s workforce inclusion.
6. Reducing Migration Costs 
   • Reducing transaction costs and facilitating smooth reintegration of returnees will maximize economic benefits.

Multiple Choice Questions (MCQs)

1. Which of the following statements is correct regarding India’s demographic advantage?

(a) India has the highest median age among BRICS nations.
(b) More than 65% of India’s population is in the working-age category (15–64 years).
(c) India’s workforce is projected to decline significantly by 2050.
(d) India has the highest labour participation rate among developed economies.

Answer: (b) More than 65% of India’s population is in the working-age category (15–64 years).

2. What is the primary challenge faced by Indian workers seeking international migration?

(a) Lack of demand for Indian workers in global markets.
(b) Complex immigration processes and restrictive policies in developed countries.
(c) Absence of skill development programs in India.
(d) Declining remittances from Indian workers abroad.

Answer: (b) Complex immigration processes and restrictive policies in developed countries.

UPSC Mains Questions

1. India’s demographic dividend is often seen as an asset, yet it presents significant challenges. Discuss how India can effectively utilize its young workforce in the global job market.

2. Labour migration plays a crucial role in global economic stability. Examine the opportunities and challenges associated with India’s role in bridging global workforce gaps.