New Delhi, 31st October, 2019: National Employability through Apprenticeship [NETAP], India’s fastest growing as well as the largest private degree linked apprenticeship program in association with TeamLease Skills University, today launched their latest report, “The Apprenticeship Outlook and Index”, a detailed six month forecast on apprenticeship hiring trends in India. The report highlights the future adoption of apprenticeship across sectors during the period- July– December, 2019. According to the report, the period July– December, 2019, will witness a positive growth in apprentice hiring. The hiring sentiment is expected to grow from 36% to 41%, indicating a 5% increase.Further, 17% more employers are positive about hiring apprentices in the long run.
The report findings highlight that 30% of employers engage apprentices with the purpose of meeting the skill requirement of the company. The growth is primarily attributed to employers being increasingly invested in the apprenticeship model over the last two years especially for cost-effective talent creation and enhanced productivity. The other factors that are driving apprenticeship adoption are the demand for advanced skill sets, financial support from the government, bringing in the services sector under the Apprenticeship Programme.
According to the findings, not only corporates in the manufacturing sector are keen on hiring apprentices, there is a significant rise in willingness from the services segment as well. 40% employers in the manufacturing sector and 42% employers in the services sector are open to hiring apprentices over the next six months. From a region perspective, the Northern (6%) and Western (8%) region exhibits the highest growth. Amongst industries, much of the hiring growth will be led by Retail (45%), FMCG & D (45%) and Travel & Hospitality (44%). Further, from an education point of view, hiring for trade apprentices will be comparatively higher, standing at 36%, followed by hiring of graduates (24%) and diploma technicians (25%). Additionally, functional areas like Production & Engineering (23%), Sales and Marketing (18%) and IT (17%) will also see increased opportunities.
KEY FINDINGS OF THE REPORT
- 17% more respondents are willing to hire apprentices in future and a significant 5% more employers are willing to hire apprentices over the next 6 months [CY-2: July 2019 – December 2019] [Current levels: 36% | Forecast: 41%]
- 40% of the employers in the Manufacturing sectors are willing to hire apprentices over July 2019 – December 2019
- Top Sectors (Manufacturing): FMCG & D (45%) and Automobile & Ancillaries (42%)
- Bottom Sectors (Manufacturing): Health & Pharmaceuticals (39%) and Agriculture & Agrochemicals (34%)
- 42% of the employers in the Services sector are willing to hire apprentices over July 2019 – December 2019
- Top Sectors (Services): Retail (45%) and Travel & Hospitality (44%)
- Bottom Sectors (Services): Telecommunications (37%) and BFSI (36%)
- 41% of employers are likely to hire apprentices over the next 6 months and 22% are less likely to engage apprentices
- Trade apprentices (36%) are likely to be hired most, followed by Graduates (24%) and Diploma Technicians (25%).
- Under the Trade category, Mechanics(31%) and Electricians(30%) are likely to be hired by most of the employers in the next 6 months
- Under the Graduate and Diploma categories, the demand is for Apprentice Mechanical Engineer /Technician(21%), Apprentice Electrical & Electronics Technician(18%)
- Under the Vocational technician category, Mechanical Technician(20%), Electrical Technician(20%) and Lab Technician(17%) will be likely hired by most of the employers
- Functional areas like Production & Engineering(23%), Sales and Marketing(18%) and IT(17%) are likely to see more hiring
- Technical Knowledge (24%) and Communication skills(23%) are the major skill requirements cited by employers
- Most employers prefer male candidates for reasons ranging from physical strength(37%), better performance(28%) and safety and security (25%)
- Majority of employers (72%) pay stipends below Rs. 12000 per month with no plans to increase over the next 6 months
- 78% of the respondents do not plan to increase stipends for new engagements over the next 6 months
- Government apprenticeship portals (31%) and Job portals (27%) are the preferred sources of hiring of apprentices
- 89% of the respondents are likely to hire apprentices for a period of 6 months to 1 year.
- Apprentices productivity overall has been positive for the sectors
- A substantial 55% of all respondents felt the apprentices they hired were “very productive”
- A significant 34% stated that apprentice productivity was “limited”
- 11% felt apprentices were not productive
Elaborating about the study, Mr. Sumit Kumar, Vice President- NETAP, TeamLease Skill University, said,“Employers are fast realising the potential of adopting apprenticeship and the findings of the report is a testimony of it. The lack of skill-based education and basic employability skills even among graduates are the biggest drivers of this growth. The absence of formal training is also a reason. Out of the required 130 million skilled workers, less than 5% undergo formal training and around 80% do not have the opportunity for skill training. Further, the recent amendments to the Apprentice Act 1961 have also added to the positivity.”
“Further, with skills as well as productivity taking centre stage, businesses want to invest in initiatives that will help them build skilled and productive talent. Around 30% of the employers were engaging apprentices with the purpose of meeting their skill requirement and a substantial 55% of all respondents felt the apprentices they hired were very productive,” added Mr Sumit Kumar
A detailed analysis, the report also delves deep into the nature of engagement. As per the report, around 89% of the employers preferred 6 months to 1-year tenure rather than short duration apprentices.
The Apprenticeship Outlook report is an in-depth study on the current levels of hiring of apprentices and employer sentiment about apprentice hiring for the next 6 months [CY-2: July 2019 – December 2019]. The insights are derived through the analysis of historical data of apprentice hiring and findings of the survey conducted with 502 employers across 12 sectors and four regions (South, North, East and West). The report also includes the Apprenticeship Index (comprising the Candidate Index and the Employer Index) which measures the effectiveness of the apprenticeship programs in India.