Future of Work and Skills for the 4th Industrial Revolution: Case of India

Excellency Julide Sarieroglu, Minister of Labor and Social Security of Turkey,
Distinguished Panelists, Ladies and Gentlemen,

I am very pleased to be participating to this session on the future of work and skills for the 4th Industrial Revolution, together with distinguished representatives from the Government of India. This is a timely opportunity to shed light on how to prepare the workforce of the future, and ensure that no one is left behind in doing so.  

Providing decent and productive work to disadvantaged groups is a significant global and national challenge. The figures are illustrative in this regard. The global youth unemployment rate is expected to be over 13% in 2017, with 71 million young individuals unemployed.  The labour force participation rate for youth has been decreasing, from 53.6% in 2000 down to 45.8% last year.  Women, especially young females, are disproportionately affected by a lack of enriching employment opportunities. For instance, most care and household duties in sub-Saharan Africa are carried out by women, which comes at the expense of paid employment.  Globally, the participation of young women in the workforce in 2016 was around 16% lower than that of young men.  

The challenge of sustainable employment will be more complex to address in the upcoming years, especially with the changes brought by the 4th Industrial Revolution, which is radically changing the traditional conception of a workforce. Through increasing automation and robotics, many occupations in the labour-intensive sectors are at risk. At the same time, new types of jobs are emerging. As highlighted by the World Economic Forum, 65% of children who are starting primary school today will be working in occupations that do not yet exist.  Skill and labor demand across industries is changing rapidly. These trends also have diverse effects on people with different skill levels. On one hand, the demand for highly skilled workers is rising. On the other, workers with lower skill levels are becoming increasingly vulnerable to losing their jobs, or rather, their jobs are prone to disappearing.

This raises two critical questions – what could be done to ensure that the global workforce has the necessary skill set to drive the 4th Industrial Revolution, and how can disadvantaged people be integrated to the market through skills development? The answer to both lies in new perspectives to plan for and prepare an inclusive and competitive workforce. An innovative approach in this regard consists in strengthening private sector involvement in the design and delivery of skills. Private sector, as the engine of growth, is best positioned to provide the capacity, knowledge, and expertise to reflect the labor market demands in trainings. In the end, private sector employs  90% of the workforce in developing countries.

I would like to refer to UNDP’s Istanbul Private Sector Center’s work here to illustrate this point further. The Center’s research series, How the Private Sector Develops Skills, highlighted several ways that the private sector can contribute to effective skills training, based on the experience of Turkey and India. Companies can support demand-driven trainings by sharing their human resource needs and labor market experience with training providers. Aligning education and training frameworks with the labor market demand, especially from the planning stage, reduces the risk of mismatches. For instance, IL&FS Skills from India works with over 1,000 partners from the industry to design its training programs in line with the human resource demand. The company has managed to train over 1.4 million individuals, out of which 500,000 were youth. 85% of these young individuals were placed in jobs.  

The private sector’s capacity for innovation and adoption of new technologies could also further leverage capacities for training. Online and distant learning opportunities have already been transforming the skilling space. Companies can foster practical and industry-relevant skills acquisition through internships, apprenticeships and other on-the-job learning opportunities. In short, the closer the private sector engagement in trainings, the smoother the transition to work for individuals, and the better the livelihood opportunities.  Our Istanbul Center has been advocating private sector-led approaches in skills delivery for the last five years, offering toolkits and project implementation support. We recently partnered with the HP Foundation to foster entrepreneurial learning, IT and core business skills to advance the SDGs.

Skills are also essential for countries to maximize the development benefits of foreign direct investments (FDI). To illustrate, over 80% of the incoming FDI to China includes green-field investments.  The new production facilities require a locally skilled workforce for operations, and then skills means more jobs and better livelihoods. After a more cautious approach to FDIs, India is now also aiming to attract international private capital for the growth of the manufacturing industry and job creation.  The country is actually matching FDIs with its aspirations to become a global manufacturing hub and human resource capital.  

Countries are thus recognizing the importance of multi-stakeholder partnerships on skills training. India has made skills development a high priority to drive its sustainable and inclusive economic growth. More than 12 million people enter the workforce in India each year, yet many do not have the skills required for employment.   The Government of India has thus set a target to skill 400 million people by 2022. The private sector will be training more than a third of this number.  A comprehensive skills ecosystem has been established in the country, which builds on the close collaboration between public, private and civil society stakeholders. The esteemed panelists of this session and speakers in the following parallel roundtable discussions will share their insights and experience regarding this ecosystem.

Lastly, it is important to recognize that the engagement of companies in skills delivery is not a panacea for employment. The capacities and resources of all stakeholders are needed and trainings should resonate with economic and industrial policies. In the end, skills per se do not guarantee job creation.

In conclusion, I would like to reiterate that the focus of skills development is not just-short term employment. It is indeed true that the private sector needs a skilled workforce for productivity and competitiveness. But it also important to realize that skills development is a pathway towards enriched choices for all, towards empowered and fulfilling lives. For individuals, skills are an enduring asset, which they can tap and nurture to overcome poverty and exclusion.

I would like to end by thanking our distinguished participants from India for joining us here today, to share their knowledge and expertise in this area. We are willing and ready to work with all partners to unlock the potential of skills needed for achieving the 2030 Agenda.