Key Points

"The global labour market is undergoing rapid transformation, with demand for skilled workers rising sharply across advanced as well as emerging economies because of ageing population in many countries and businesses looking to adopt and scale up digitalisation." noted the report

The report also highlighted that while some countries are witnessing rising unemployment, many employers across the world continue to face challenges in finding skilled workers.

It stated "India to become a global employment epicenter..., the global labour market is undergoing a contradictory situation, where some countries are experiencing rising unemployment even as employers struggle to find skilled workers".

The primary reason for this paradox is the growing demographic divergence. High-income countries are experiencing rapid population ageing due to sustained decline in fertility rates and rising life expectancy.

This has resulted in a high dependency ratio of elderly people in the working population, further deepening the skills shortage.

On the other hand, lower- and middle-income countries are seeing a demographic expansion, with a rising number of young individuals entering the workforce.

According to the International Monetary Fund's World Economic Outlook, by 2050, these countries are expected to contribute nearly two-thirds of the global workforce entrants.

The report also mentioned that India, with 65 per cent of its population under the age of 35, finds itself in a unique position to bridge this global skill shortage. The country has the potential to supply surplus labour and fill the talent gaps in high-income nations.

However, Crisil's report also cautioned that India's labour market faces serious challenges, particularly in the form of under qualification and widespread skill gaps.

As per the Periodic Labour Force Survey, less than half of India's graduates are considered fully employable, and only 4.4 per cent of the workforce has received formal vocational training.

This indicated that despite having a large workforce, the issue of inadequate skill development has become endemic in the country.

The report outlined that India must urgently address the structural gaps in its skilling ecosystem. By doing so, the country can not only improve domestic employment and productivity but also contribute to bridging the global skills shortage.

- ANI