Need to expand access to formal skilling; expand coverage of training programmes: Eco Survey

Asserting that only 4.9% of the youth in the 15-29 age group have received formal vocational or technical training, the Economic Survey 2025-26 on Thursday called for expanding access to formal skilling and increasing the coverage of skill training programmes.

The Survey highlighted that skill education in schools would equip young people with market-aligned skills, particularly in the service sector, which absorbs over half of the formally trained youth, while reducing dropouts by linking education to economic opportunities.

It emphasised that strengthening the alignment between school education and national skilling priorities is essential for reducing the share of out-of-school children and building a productive workforce.

As India seeks to harness its demographic dividend and respond to evolving labour market needs, a well-integrated and forward-looking skilling system is critical to enabling the workforce to capitalise on emerging economic opportunities, it stated.

"Expanding access to skills and improving their quality requires a well-integrated skilling ecosystem," it said, adding that enhanced coordination across ministries and levels of government would enable the diverse skilling initiatives to improve employability, expand coverage, and better equip the workforce for technological and economic changes.

A unified apprenticeship mission may be needed to bring the National Apprenticeship Promotion Scheme (NAPS), the National Apprenticeship Training Scheme (NATS), and similar schemes under a single framework, ensuring better policy alignment and closer integration between education, skilling, and employment, the Survey observed.

The Survey also pitched for strengthening District Skill Committees as local anchors and suggested that enhanced industry participation can be encouraged through MSME cluster models and graded incentives tailored to companies based on their size.

Asserting that industry-driven skilling remains central to building job-ready talent and strengthening skill-industry linkages, the Survey calls for re-anchoring incentives around outcomes and retention, outlining that if payments, renewals and reputational credibility are tied primarily to numbers trained, the rational behaviour of the system will be to maximise throughput.

It suggests that local labour market intelligence must shape course portfolios, observing that the failure of many skilling efforts is mainly due to an inappropriate mix of courses relative to district-level demand rather than the quality of training imparted.

The Survey also advocates involving employers right from shaping course curricula to align skills with actual tasks and equipment; creating workplace learning opportunities through apprenticeships or internships; and jointly participating in assessment, ensuring that certification signals competence rather than attendance.

It further calls for advancing institutional convergence and fostering a whole-of-government approach to enable the skilling and employment initiatives to operate in a coherent manner.

According to the Survey, "There is a need to expand access to formal skilling as only 4.9% of the youth (in the 15-29 age group) have received formal vocational or technical training, while another 21.2% received training through informal sources".

Estimates from a 2025 study suggest that a 12-percentage-point increase in skilled workforce through investment in formal skilling could lead to more than a 13% increase in employment in the labour-intensive sectors by 2030, it highlighted.

The Survey stressed the need to expand coverage of skill-training programmes while ensuring quality and alignment with market demands.

As India's skill landscape expands with a growing working-age population, skilling programmes need to work together in a mutually reinforcing way, stated the Survey, pointing out that internationally, countries are shifting towards a whole-of-government approach in skilling that enables coordination across ministries.

"As India moves ahead in its growth journey, advancing institutional convergence and fostering a whole-of-government approach would enable the skilling and employment initiatives to operate in a coherent manner.

This could set the stage for a sharper emphasis on industry-driven skilling, which remains central to building job-ready talent and strengthening skill-industry linkages," noted the Survey.

It also suggested that by driving unified governance, localised implementation, and industry partnerships, India can transform its apprenticeship ecosystem to meet the evolving needs of the labour market and promote inclusivity, security, and aspiration.

According to the Survey, the convergence of policy reforms, institutional coordination, and industry engagement will position apprenticeships as a strategic lever for generating sustainable employment.

"By aligning learning with labour-market needs, vocational tracks have the potential to enhance employment prospects, facilitate smoother school-to-work (STW) transitions, strengthen workforce participation, and reduce unemployment, thereby contributing to broader economic and social development outcomes," it stated.

For the upcoming budget, industry experts have also highlighted that the cybersecurity workforce also requires standardisation. To address a shortfall of 5 lakh professionals, experts suggest creating India-specific security certifications as a policy requirement for job applications. By institutionalising these skills and updating the National Cybersecurity Policy to reflect the complex threat landscape, India can enhance its reputation as a trusted global destination for business.

Also, while India leads in AI skill penetration, there is a shortage of professionals capable of deploying large-scale solutions. Deloitte has recommended introducing project-based AI learning modules from primary schools to universities to ensure a continuum of literacy.

(With inputs from PTI)