Bharat-2047: Vision for Talent Management
India’s young and growing population presents a tremendous opportunity to address the talent shortage through comprehensive measures. — Dr. Jaya Sharma
The vast population of India, which stands at 1.42 billion, together with ideal age distribution of its workforce, is poised to play a significant role in its economic growth in the coming years, rather for decades. India’s large pool of working age population along with its skill-based talent would help to address the manpower needs in India as well as worldwide and prove a boon to augment growth domestically and internationally. This has the potential to support competitive manufacturing in India as well as support the global supply chains with the expanding domestic consumption. As per Ernst & Young, the share of India’s working age population to total population will reach its highest level at 68.9% by 2030 and India would be home to 24.3% of the world’s working age population. India would have 1 billion plus working age population between the 15-64 years of age. By the year 2030, India’s dependency ratio is projected to reach its lowest point at 31.2%. Moreover with a relatively young population (median age of 28.4 years), India not only gets a competitive advantage in terms of workforce but also an opportunity to unleash the consumption power of a young population.
Indian demography: Ray of Hope for the World
As the world struggles with shifting demographics and a shrinking youth population in industrialized countries of Western Europe, erstwhile Asian tigers and even the United States and Canada due to the ageing and declining of its working age population as well as skill shortage in major occupation in a broad variety of sector; India emerges as a promising source of talent and economic growth. With its burgeoning working-age population, India is poised to become a major global economy resource. India is experiencing a demographic dividend, characterized by a large and youthful working-age population. This demographic advantage presents a unique opportunity for India to capitalize on its human capital potential and drive global economic growth.
Today almost 77% of the employers have been experiencing talent scarcity across the world. Employers in the country like Taiwan, Germany, Hong Kong, and Singapore have been experiencing talent scarcity to the tune of 90%, 86%, 85% and 83% respectively. As per the ManpowerGroup talent shorting survey, “today 77% of employees report difficulty in filling roles – a 17 year high.”
Population Crisis in Major Economies
Countries like Germany and Singapore have already begun to leverage international collaborations to bridge the talent gap and sustain their economic growth. Germany’s federal labor agency has highlighted the urgent need to attract a minimum of 400,000 skilled immigrants annually in order to meet the growing demand. The United Kingdom too is struggling with a significant shortage of skilled workers. This shortage is unprecedented and has affected various sectors, including manufacturing and service sector. Post Brexit, the UK can no longer easily recruit certain resources from European countries, leading to an increased reliance on domestic talent. Moving on to Poland, the country is experiencing rapid aging, with a significant increase in median age from 25.8 in 1950 to 38.2 today, projected to reach 51 by 2050. This demographic shift is coupled with a decline in population, dropping from 38.6 million in 1995 to an estimated 32 million in 2050. There has been a significant shortage of talent in Canada as well, across multiple sectors. The Canadian government is also taking steps to support skills training and streamline immigration processes for qualified professionals.
Highlighting the needs to attract migrants with skills and talents in the EU from outside the EC (Euro Commission) has on 27th April 2022, published a communication to the European parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on attracting skills and talent to the EU. The communication discusses operational and legislative initiatives to attract skills and talent to the EU. The talent shortage is predicted to reach 14.3 million in Europe, the Middle East & Africa (EMEA) by 2030.
Silver lining for India
India is endowed with around 24% of the global working age population and has 3rd largest talent pool in the world. The economies of EMEA as well as North America especially U.S. and Canada are largely dependent on Indian Diaspora of skilled manpower. Today Indian CEOs manning companies outside India is largest, with notable examples ranging from accomplished technology enthusiasts making their mark in Silicon Valley to influential tycoons at the helm of highly successful multinational conglomerates. Leading companies like Google, Microsoft, and Adobe are guided by notable Indian CEOs, like Sunder Pichhai, Satya Nadella, Shantanu Narayan. Their contributions serve as testimony to the significant impact of Indian talent in shaping the strategies and achievements of renowned multinational corporations.
To tap the dearth of talent and skilled manpower across the globe, India should revamp its education and skill development centres particularly, technical and medical education. This can be achieved through curriculum updates, fostering industry-academia collaboration, establishing research and innovation hubs, and providing incentives and funding. These efforts will equip students with relevant skills, attract top talent, and create a strong pipeline of skilled professionals to meet the demands of the Western job markets.
Private Transfers: Large Contributor of Foreign Exchange
Private transfers, specifically the remittances sent by Indian workers residing overseas, play a substantial role as a major contributor to India’s foreign exchange reserves. Despite the negative consequences associated with brain drain, these remittances have emerged as one of the primary sources of foreign exchange inflows for the country. As evidence of their significance, in the fiscal year 2021-22, India recorded a substantial influx of $89.12 billion from abroad through remittances alone. This considerable amount underscores the substantial contribution made by private transfers towards bolstering India’s foreign exchange reserves. It is worth noting that India also contends with a sizable trade deficit, further highlighting the significance of private transfers as a crucial source of foreign exchange to help offset the deficit.
Inward Remittances from past five years:
Year Inward Remittances
2017-18 69,129
2018-19 76, 396
2019-20 83, 195
2020-21 80, 185
2021-22 89,127
Source: RBI
If India can properly augment its talent resources and cater the talent shortages worldwide the remittances can cross $300 bn before 2030. Remittance flows to India will rise 12% to reach $100 bn in the last fiscal 2022-23. However, it is not easy to achieve the target of remittance flows of $300 billion unless quality and innovativeness of education is enhanced for better employability of passing out graduates. The problem of skill gap too needs to be addressed well.
Country-wise share of inward remittances to India
(based on survey conducted by the RBI for 2020-21):
Source Country Share in Total Remittances (%)
United States 23.4
Qatar 1.5
United Arab Emirates 18.0
Hong Kong 1.1
United Kingdom 6.8
Australia 0.7
Singapore 5.7
Malaysia 0.7
Saudi Arabia 5.1
Canada 0.6
Kuwait 2.4
Germany 0.6
Oman 1.6
Italy 0.1
Source: RBI Remittance Survey, 2021 as published in RBI Bulletin article on remittances, “Headwinds of COVID-19 and India’s Inward Remittances”, July 2022.
Smart campuses can play a crucial role in bridging the skill gap by leveraging technology and innovative approaches to education. Smart campuses have the potential to bridge the skill gap by harnessing the power of technology and innovative educational approaches. Through personalized learning, smart campuses can utilize advanced technologies like artificial intelligence and machine learning to tailor educational content and resources to individual student needs, enhancing skill development. Immersive learning environments, enabled by virtual and augmented reality technologies, can provide students with hands-on experiences in different fields, fostering practical skills acquisition. Additionally, smart campuses can offer access to online courses, webinars, and digital resources, enabling continuous learning and upskilling opportunities. By leveraging these technological advancements, smart campuses can effectively bridge the skill gap and equip students with the in-demand skills needed to succeed in the evolving job market.
In conclusion, the talent sh
ortage is a pressing global challenge that demands strategic solutions. While countries worldwide grapple with this issue, India stands in a unique position with its demographic dividend. India’s young and growing population presents a tremendous opportunity to address the talent shortage through comprehensive measures. By investing in education, skill development, and leveraging technological advancements, India can harness its demographic advantage to meet the talent demands of not only its own economy but also the global market. With the right initiatives in place, India can unlock its full potential and contribute significantly to global workforce dynamics.
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