Executive Summary
Introduction
The National Skill Development Corporation (NSDC) has engaged the services of Feedback
Infrastructure Services Private Limited to undertake a district-wise skill gap assessment study
for the Delhi-NCR region. The study covers the nine districts in the state of Delhi (Delhi-NCT)
and the urban areas of its five major satellite towns, namely, Noida, Gurgaon, Greater Noida,
Ghaziabad and Faridabad. For ease of understanding and consistency, the term ‘district’ is used
to refer to each of the nine districts of Delhi-NCT and the five urban areas of the satellite towns.
The study aims to cover the socio-economic scenario, identify the existing skill development
programs, understand the aspirations of the youth, estimate demand-supply scenario for
manpower across sectors for today (2012) and the future (2017, 2022) and suggest
recommendations to address the skill gaps in the Study Area.
Methodology
The study utilizes a mix of primary and secondary research to identify the key employment
sectors, existing skill gaps and other inputs required to estimate workforce requirements across
sectors. Population profile and training infrastructure capacity is used to estimate the
incremental supply of workforce. Focus group discussions are utilized to understand the
aspirations of the youth in the Study Area, in terms of preference for employment across
sectors and their underlying drivers. Based on the research, 25 sectors have been shortlisted for
detailed skill gap analysis, of which 18 sectors are key employment sectors in all the 14 districts
in the Study Area while the remaining 7 sectors have been analyzed only for specific districts
where they are key employment sectors.
Socio-economic overview
Population: The Study Area had an overall population of ~2.15 Crores (as of 2011), that is ~2%
of India’s population, of which ~1.68 Crores was in Delhi-NCT and the remaining ~0.47 Crores
was in the satellite districts. The region is highly urbanized in nature with more than 97% of the
population residing in urban areas. While Delhi-NCT has witnessed population growth rate of
~2% per annum in the last decade, the satellite districts have witnessed much higher growth in
the range of 3 – 15% per annum, due to high inflow of migrants, driven by rapid urbanization in
these regions.
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Human development parameters: While the sex ratio is relatively poorer in Delhi (866 per 1000)
as compared to the rest of the country (940 per 1000), the region fares much better than the
country average in terms of literacy (86% in Delhi vs. 74% in India) and human development
index (0.737 in Delhi vs. 0.571 in India).
Economy: Delhi’s economy has grown at 12% per annum during 2004-12 and is dominated by
the tertiary sector which accounts for 87% of the state’s GDP. The secondary sector contributes
to 12% of the state GDP while the contribution of the primary sector is less than 1% due to lack
of agriculture and mining activities.
Population profile: Delhi-NCT has a fairly young population profile with more than 50% of the
population being less than 30 years of age and ~66% being in the working age group (15-59
years). Workforce participation rates in the Study Area are in the range of 32-34% for Delhi-NCT
and the satellite districts.
Districts profile: Due to the service sector orientation of the economy, most of the districts in
the Study Area are characterized by commercial and business activities, the key hubs being New
Delhi, Central and South Delhi districts in Delhi-NCT and Noida and Gurgaon among satellite
districts. The major manufacturing activities are concentrated in the districts of East, North East
and West Delhi in Delhi-NCT and Faridabad and Ghaziabad among satellite districts. Delhi being
the capital of India, there is significant presence of public administrative bodies in New Delhi,
Central and South West Delhi districts. In addition, there is large concentration of education
institutes in North Delhi.
Employment overview
By region: The Study Area employed 86 lacs people in 2012 that is expected to grow to 103 lacs
in 2017 and 128 lacs in 2022. Out of the 86 lacs people employed in 2012, Delhi-NCT accounted
for 57 lacs (66%) of the total workforce and the satellite districts accounted for the remaining
29 lacs. North West, South Delhi and Gurgaon are the largest employment districts accounting
for 32% of total employment in the Study Area. The employment growth is going to be higher in
the satellite districts due to rapid urbanization and higher industrial growth (as compared to
Delhi-NCT) in these districts. In 2022, employment in Delhi-NCT would be 77 lacs as compared
to 51 lacs in the satellite districts.
By sectors: The tertiary sector contributes to more 85% of overall employment in the Study
Area as of 2012. Retail sector accounts for highest employment generation in Study Area with
total employment of ~17 lacs, followed by construction (~15 lacs) and transportation (~14 lacs).
Retail, construction, domestic help and transportation sectors together account for ~60% of
total employment amongst the shortlisted 25 sectors. In contrast, major manufacturing sectors
together account for only ~10 lacs (~12%) of total employment in 2012 highlighting the low
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contribution of the manufacturing sector in the Study Area. Going forward retail, construction,
domestic help and transportation sectors would continue to drive incremental employment
demand along with other service sectors like IT & ITES, hospitality, healthcare, education and
banking, financial services and insurance (BFSI).
By skill levels: Minimally skilled employees account for majority of total employment (72%) in
the Study Area followed by skilled and semi-skilled categories accounting for 18% and 10%
respectively of total employment. Going forward in 2017 and 2022, minimally skilled labour
would continue to hold largest share of employment demand due to demand generated from
large employment generating sectors like domestic help, security, construction and
transportation, where majority of workforce is in the minimally skilled category. While overall
workforce is expected to grow at 4.1% per annum in the Study Area, demand for semi-skilled
workforce is expected to grow fastest (4.6% per annum) followed by skilled category (4.3% per
annum). This indicates that while minimally skilled employee requirement would be higher in
terms of absolute numbers going forward, demand for trained manpower (skilled and semiskilled categories) is growing at a relatively faster pace, indicating that in the coming decade
there would be a higher percentage of jobs created for trained manpower.
Workforce supply
Overall workforce availability: Based on the projected population growth, age profiles and work
force participation rates, the work force in Delhi-NCT is expected to grow from 56 lacs in 2012
to 72 lacs in 2022, while the same in the satellite cities would grow from 32 lacs in 2012 to 51
lacs in 2022. Of the total incremental workforce of 30 lacs in the Study Area over 2012-22,
Delhi-NCT and the satellite districts would each contribute to ~50% of this incremental supply.
In terms of incremental demand-supply scenario, the demand-supply deficit (in percentage
terms) is decreasing over time in the satellite districts while the reverse trend is observed in
Delhi NCT. This is due to the fact that in-migration being higher in satellite districts, incremental
supply in these regions is growing at a faster pace as compared to Delhi NCT. While the shortfall
for full-time manpower is in the 3-6% range, it is not a major cause for concern as the deficit
could be met through migrants and workforce residing in rural areas (adjacent to the Study
Area) and slight increase in workforce participation rates which can be expected to higher
workforce participation rates among migrant workers.
Workforce availability across skill levels: The training infrastructure in the Study Area is marked
by K-12 schools for education upto higher secondary level, which is the only source of minimally
skilled workforce. For semi-skilled workforce there is variety of training institutes such as
Industrial Training Institutes (ITIs), Vocational Training Providers (VTPs), etc while universities
and other technical institutes (e.g. engineering and medical colleges are sources of skilled
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workforce). Based on existing capacity of training infrastructure and historical growth rates in
enrollments across different categories of training institutes, the following demand-supply
arises across skill levels in terms of workforce availability:
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Skilled – There is sufficient supply of skilled workforce in the Study Area over 2012-17
and 2012-22. There is no shortage to meet the incremental demand in Delhi-NCT and
satellite districts of Faridabad and Ghaziabad as these regions have considerable
number of higher education institutes for providing skilled workforce. While, there is
shortage of skilled workforce in the districts of Noida, Greater Noida and Gurgaon,
almost 60% of the incremental demand for skilled workforce is in the IT & BPO sector,
for which workforce is usually employed from regions all across the country.
Considering that skilled workforce is typically mobile in nature (i.e. employment is
usually in region different from where training is received) and that is considerable
oversupply of skilled workforce in other districts of the Study Area, there are no major
concerns pertaining to supply of skilled workforce.
Semi-skilled – There is going to be a shortage of semi-skilled workforce in the Study
Area over 2012-22. However within semi-skilled workforce, there is going to be no
shortage of informally trained manpower, as they are minimally skilled manpower
promoted internally based on their experience and expertise for which there is
adequate supply. On the other hand, supply for formally trained manpower is
dependent on the availability of training infrastructure and their enrollments. Based on
this, there is a significant shortage of semi-skilled manpower across all districts except
Ghaziabad. The shortage is particularly high (more than 50%) in the districts of
Faridabad and Gurgaon where there is considerable demand for semi-skilled manpower
due to presence of large scale manufacturing industries.
Minimally skilled - Overall, there is adequate supply of minimally skilled workforce in
the Study Area despite likely shortages in certain districts namely, Gurgaon, Noida and
Greater Noida. Considering that overall population potential is sufficient to meet
demand and there is considerable oversupply in other regions in the Study Area, there
is no reason for concern on overall supply of minimally skilled workforce.
Youth Aspirations
To understand the aspirations of the youth in the Study Area, focus group discussions were
conducted across 16 samples covering a total of 344 people primarily in the age group of 15 -21
years across all regions in the Study Area. The samples included a mix of people enrolled in
formal and informal training institutes as well as manufacturing and service sector oriented
programs. The key aspects coming out of the discussions was that the youth preferred to take
up jobs where short term gains were high without considering long-term benefits. There was
preference for working in less labour intensive job profiles in comfortable working
environment. There is a preference for government jobs, entrepreneurship and women are
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inclined to work in the vicinity of their households. Peers, family members and economic
background also are key influencers when it comes to selection of the job/ sector. Hence
service sectors such as retail, IT & BPO, education, public administration and a few
manufacturing sectors such as auto and auto parts, electrical equipments, textiles and apparel
and electronics hardware are amongst the most preferred sectors in the Study Area. Labour
intensive sectors like domestic help, wholesale trade, security personnel, wood and furniture
are amongst the least preferred sectors for employment. While there is mismatch in youth
aspirations and incremental manpower demand across sectors, the impact is highest in
domestic help sector followed by construction, transportation and hospitality, where the Study
Area would be dependent on migrant workers to fulfill a significant share of the incremental
demand.
Existing skill development programs
The Directorate General of Employment & Training (DGE&T), Ministry of Labour & Employment,
at Central Government level has started some schemes along with respective State
Governments to cater to the semi skilled manpower requirement of the Industries in both
organized and unorganized sectors. These schemes vary from short term part-time courses (60
hours to 1-3 year programs, primarily catering to various skills in the manufacturing sector. The
private sector is also involved in the training of workforce in the Study Area. Three ‘Centers of
Excellence’ have been set up and another three have been upgraded under the Public Private
Partnership (PPP) scheme for training workforce in the manufacturing and information
technology sectors. In addition, the state governments across various regions in the Study Area
have also setup self-help schemes to encourage self-employment across various sectors. While
all these skill development programs are well intended and provide adequate benefits, their
success has been limited due to implementation issues such financial constraints, institutional
drawbacks, oversight, linkage problems and lack of awareness among population.
Recommendations
To address the above mentioned implementation issues, the report focuses on outlining steps
for four key stakeholders, namely, the state government, NSDC, training institutes and
employers. The state government needs to ensure that for most manufacturing sectors (details
in the report) the curriculum is updated, quickly adapted and implemented by training
institutes. The government needs to enforce implementation of skill development programs for
sectors such as retail and healthcare which lack training infrastructure. There are multiple
sectors (details in the report) such as retail, hospitality, auto and auto parts manufacturing,
metallic products manufacturing, etc that are facing shortage of workforce. The state
government needs to enhance training capacities for these. Training institutes need to support
the state government in developing training infrastructure for above mentioned sectors.
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The government also needs to develop and implement institutional measures to enforce
suitable working conditions to avoid manual exploitation of labour in sectors such as
construction and domestic help. Employers in these sectors need to adhere to the guidelines
provided by the state government.
NSDC needs to facilitate infrastructure creation for training entry level workforce in sectors
such as retail, textile and apparel, auto and auto parts, etc (details in the report). It also needs
to establish presence and importance of sector skill councils for key sectors in the Study Area
(details in the report). NSDC needs to support in identifying regions for mobilizing workforce
from outside the Study Area in sectors such as wood and furniture, printing and publishing, etc
where youth aspirations are low. Training institutes within the study area need to act as
centralized placement agencies for these sectors.
Training institutes need to forge partnerships with employers for ensuring suitable placement
of students. It provides the employers a steady supply of trained workforce and medium to
provide feedback to training institutes on training curriculum and training quality. Large scale
employers need to provide training capacity in sectors like retail that lack training infrastructure
by registering themselves as Vocational Training Providers (VTPs) under the Skill Development
Initiative scheme.
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