Manufacturing sector employs close to 27 million people and has the potential to reach 1 trillion USD by 2025. It is extremely crucial for India’s growth but forced and extended lockdowns during the pandemic created a significant dip in the sector’s employment levels. Capacity underutilization, liquidity crunch, shortage of labour, shortage of raw material, regulatory restrictions, supply chain disruptions are some of the common issues faced by the manufacturing industry. However, the biggest concern for the industry is the issue of skill gap and lack of talented workforce that is in tune with the emerging industry trends.
Apprenticeship programs have proven to be one of the best methods to ensure a steady stream of skilled and job-ready workforce for all industries including manufacturing and engineering, mitigating their complex workforce challenges. It is slowly gaining increased acceptance and recognition among the Indian employers as a sustainable and fulfilling skill upgradation and career enhancement program to direct the next generation towards a brighter future in niche domains and as a tested solution for recruiting, training, and retaining world-class manufacturing talent.
In India, less than 5% of the Indian workforce have undergone formal skill training, whereas 80% of the workforce entrants do not get the opportunity for skill training. In order to promote an apprenticeship ecosystem in the country, the government has mandated establishments with a workforce of 40 or more to undertake Apprenticeship Programmes and commit 2.5% -10% of their workforce every year to apprentices and also reimburses a fixed amount to promote the apprenticeships.
Several organizations across the manufacturing, services, and agriculture sectors have realised the advantages that come with apprenticeships, like creating a pool of job-ready talent as per their industry needs, low recruitment & rehiring costs due to low attrition rate, and also being able to contribute towards solving India’s unemployment problem by creating a skilled workforce. Engineering, Automobile & ancillaries, FMCG, Health and Pharmaceuticals, Apparels & textiles, Electrical & electronics are some of the major manufacturing industries which have hired apprentices in decent numbers.
If we compare and analyse the trends from the Apprenticeship Outlook Report published by National Employability through Apprenticeship Program (NETAP) over the last 3 years there is a clear increase in the intent to hire apprentices among the Indian manufacturing sector. 40% of the employers were willing to hire apprentices in H2 2019 (July-Dec) in the manufacturing industry, an intent which increased to 62% during H1 2020 (Jan-June), but dropped to 40% due to pandemic outbreak and extended lockdowns during H2 2020 (July-Dec).
Large businesses in the Manufacturing industry witness the highest NAO (net apprenticeship outlook) of 66% in H2 2021 (July-Dec) reaffirming that the manufacturing industry is back on the tracks. Engineering (NAO: 68%), Automobile & Ancillaries (NAO: 58%), and FMCG & D (NAO: 52%) are the top three sectors across the Manufacturing Industry with the most positive hiring intent in H2 2021 thanks to workforce optimization by employers.
Large businesses have always hired more apprentices as compared to the smaller businesses in the manufacturing domain, and the apprentice hiring sentiment for H2 2021 at 66% which has been the highest so far reaffirms the fact. Unfortunately, small and medium businesses were hit the hardest by the pandemic in H2 2020, which resulted in a very low hiring sentiment that year, but it has increased in H2 2021, showing that even the small businesses are taking a keen interest in hiring apprentices.
Manufacturing industries with high-risk job roles, long & stressful working environment, or field roles have traditionally favoured male apprentices over the females. But the AOR report shows that things are finally moving in the right direction as the male-female preference gap has narrowed significantly this half year (H2 2021) as compared to the previous half year with 36% preference for male candidates and 32% preference for female candidates indicating that the hiring intent is slowly inching towards gender parity.
32% employers deem apprentices to be very productive and Optional Trade is the most preferred category for hiring apprentices in the Manufacturing sector with 67% intent to hire, followed by 60% hiring intent for trade apprentices & 44% hiring intent for technician apprentices
Job roles like Machinist (35%), Mechanic (30%), Fitter/Welder (24%) are likely to be in higher demand whereas other hiring opportunities in the Manufacturing Sector are for sales (20%), Marketing (7%), Information Technology (7%), Production and engineering (60%), HR (3%), Admin & Office services (7%).
Interest in the trade, Technical Knowledge, Physical fitness, Willingness to learn, Personality, Communication skills, and English skills are some of the essential skill sets employees are looking for when hiring apprentices. However, with the emergence of Industry 4.0 and increased use of technology in the sector, technical competence and ability to learn new skills at a faster pace is something which employers are looking for.
Employers across the manufacturing industry are also increasingly inclining towards degree embedded apprenticeship programmes (6-36 months) which blend traditional classroom learning with on-the-job learning and help ITI or diploma pass outs, undergraduates, or graduates complete their degree aspirations, build a successful career, upskill, gain job experience, and also earn while they learn and support their families. These degree-linked or degree embedded apprenticeship programs not only help employers create a job-ready talent supply chain as per their skill needs, mould candidates as per their company’s culture and values, save on recruitment and rehiring costs (due to low attrition rate), but it also helps them solve and contribute towards a bigger cause – addressing India’s unemployment problem and providing a solution by making people employable.
Sumit Kumar is the Vice President of NETAP-TeamLease Skill University.