Education at the forefront of India’s growing complexity
Economist Ricardo Hausmann suggests that prosperity stems from economic complexity and that economic development is like a game of Scrabble. The private sector provides the letters (more of which allow for more and longer words), and the government provides the vowels. Higher wages for workers arise from more words (more firms competing for talent), longer words (high productivity firms and industries), and more vowels (efficient public goods). We argue that our economic complexity, commonly associated with 5 million software jobs, will jump over the next five years as 12 million new jobs in engineering, telecommunications and healthcare combine with the human capital of the National Education Policy (NEP) to accelerate India’s transition to growth, complexity and higher wages.
Unemployment is a weak measure of the health of our labor market; the poor cannot afford to be unemployed, so they exploit themselves in agriculture, self-employment or informal employment. Reducing these warehouses of low-productivity labor requires political assistance: civil service reform, lower regulatory cholesterol for employers, decentralization of power, and so on. agricultural employment in production for export relative to domestic consumption. Nobel laureate Arthur Lewis has suggested that development involves bridging the gap between a narrow ‘modern’ sector that uses advanced technology and a larger ‘traditional’ sector with very low productivity. The prosperity of [email protected] depends on increasing the productivity of all businesses and citizens, regardless of meeting domestic or global demand, or supplying services or manufactured goods.
Our national goal is to increase GDP per capita and the economy has emergent properties that can contribute to prosperity; for example, domestic markets have reached critical mass and half of all foreign direct investment since 1947 has taken place in the past five years. Our research suggests that engineering, telecommunications and domestic demand-driven healthcare now employ 42 million people (9% of our workforce). We expect this to grow rapidly over the next five years; engineering at 38 million from 30 million, telecommunications at 6 million from 4 million and healthcare at 9.5 million from 7.5 million, all of which would have many new roles and job profiles offered in a variety of subdomains.
India’s economic complexity has suffered because poor infrastructure, uneven skills and excessive regulatory cholesterol (the Factory Act contains over 700 imprisonment provisions) have kept manufacturing at 11% of employment. But we expect that number to rise to 17% with better infrastructure, easier trade reforms, growing domestic demand and production-related incentives increasing factories for phones, computers, electronics, electronics, and more. telecommunications equipment, medical devices, precision parts and many more. .
Significant telecom hiring needs stem from mobile virtual network operators, 5G spectrum and white space, and reliable remote work setup needs. Hiring of network engineers doubled last year. Finally, covid has forced a lagging review of healthcare employment, with an advanced decades-long expansion.
No one knows whether high-wage jobs or human capital come first, but the two must dance together for mass prosperity; in 1951, even the colonialist Winston Churchill recognized that the empires of the future were empires of the mind. Mahatma Gandhi emphasized human capital earlier (his 1934 speech on Nayi Taalim). Yet our education policy – the Radhakrishnan Report of 1948, the Kothari Panel of 1968 and the New Education Policy of 1986 – created islands of excellence, but performed below average in terms of of mass reach, multidisciplinarity, basic literacy, numeracy and creativity.
Today’s NEP is a revolution that is long overdue to prepare us for the 21st century. It shifts politics from prescriptive and directive to empowering and enabling, giving the federal structure a key role, with states ultimately setting their agendas. It aims to soften the hard lines between ‘art’ and ‘science’, ‘academic’ and ‘professional’, and ‘curricular and ‘out-of-school’. It emphasizes analytical and creative thinking, rather than rote learning, apart from speaking, writing, and lifelong “learning to learn”. It makes the holistic development of the intellectual, social, physical, ethical and emotional capacities of our children the goal of education.
NEP is timely as workers now compete with a technological tsunami of machine learning, robot automation, artificial intelligence, and more. The NEP recognizes the problems of education systems that provide and measure cognitive quantity (how much you know) rather than the quality of thinking, learning, and emotional engagement with others. The book Humility is the New Smart by Edward Hess and Katherine Ludwig suggests that the human advantage over algorithms is our ability to think critically, be creative, and relate to others. They frame humility not as self-effacement, but as self-awareness of technology; recognize that no one can have all the answers, stay open to new ideas and engage in lifelong learning.
India’s prosperity depends on increasing the productivity of our regions, cities, sectors, businesses and citizens. As hot sectors employ millions more people, the NEP represents a bold move to accelerate complexity by restarting education. This virtuous circle of formal jobs and efficient education is India’s new love affair with its destiny. It is an appointment that we must respect.
Manish Sabharwal and Sunil Chemmankotil are Vice President respectively; and Head, Specialist Staffing, Teamlease Services.