Gurgaon-based business consulting group Wazir Advisors takes a look at the status of skill development for the Indian retail sector
The retail sector is having one of the highest incremental employment generations as sectoral employment base is expected to reach 56 million by 2022. The opportunities in the retail sector span across sales, merchandising, store operations management, warehouse management and procurement. Despite huge employment opportunities, the employability gap is still a major constraint as 74 per cent of the workforce is at or below secondary educational level.
To reduce this gap and enhance the availability of people with the right skill sets, the Indian Government has taken initiatives such as the Deen Dayal Upadhyay Grameen Kaushal Viskas Yojna (DDUGKY) and the Pradhan Mantri Kaushal Vikas Yojana (PMKVY). Launched by the ministry of rural development in 2014, the DDUGKY scheme aims at enhancing the employability of rural youth. The second initiative was started by the ministry of skill development & entrepreneurship in 2015 to recognise and standardise skills among the Indian youth.
Progress till last year
In DDUGKY, the candidate enrolment for retail sector stood at 56,200 - the highest amongst all sectors - till August 2017. This is. On the other hand, in PMKVY, 1,04,650 candidates have been enrolled for short-term training programmes and 12,000 employees were registered for Recognition of Prior Learning (RPL) certification by August 2017.
Besides DDUGKY and PMKVY, many states have launched their own skill development programmes. Further, corporations are also training people under their corporate social responsibility (CSR) initiatives. Another 30,000-35,000 are estimated to be enrolled under these programmes by 2020.
Despite the efforts of the central government, state governments and corporations, the trainee numbers achieved are lesser than projected requirement. At the same time, the industry is also saddled with a high attrition rate of 30-40 per cent. Hence, the trained resources are only filling up the vacant positions arising due to attrition rather than meeting new demand.
Industry players are observed not being keen to pay any premium to trained candidates. The entry-level salary is also decided on the basis of exposure rather than skills acquired through such programmes. Therefore, the candidates are losing interest in such training programmes in the absence of recognition.
Besides retail, there also exist other sectors like business process outsourcing (BPO), telecom, insurance and e-commerce, which offer relatively lucrative options to candidates. Thus, the interest of working in retail appears to be low. This is further strengthened by perception of candidates about job conditions in retail. The candidates cite long working hours as physically and mentally tiring.
The way forward
The industry needs to step up efforts to support the existing skill development programmes. Effective talent management practices can help in retention of candidates as well as to attract individuals towards the sector. To attract more young employees to the retail sector, trained candidates need some kind of recognition by companies. Given the long hours and physically-demanding job roles, recognition- and rewards-based human resource policies need to be refined and implemented in full earnest.
The sector also has some positive aspects that make it favourable amongst other sectors:
People get trained in a short span of time as not much technical skill or set-up is required for majority of the entry-level jobs in retail.
With retail expansion happening in tier 2, 3 & 4 cities, candidates won't have to migrate to big cities for jobs.
With high growth in the sector, hard-working candidates can rise up the ranks quite fast and prosper in their careers.
These advantages can be leveraged and a concentrated effort must be made to have the basic skills taught as an optional vocational subject in Standard X, XI and XII in schools. This may offer a larger pool of candidates in the coming years.
In light of the industry's growth and manpower requirement, it is recommended that the industry players support the initiative taken by the government with utmost sincerity, else the allocations and enrolments for the retail sector will gradually reduce, which will adversely affect the sector, bringing it back to where it all began.