Profile of Indian Labour in US

8/11/2019 Profile of Indian Labour in US

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India's BorderlessWorkforce

A Manpower India White Paperdeveloped in collaboration

with Dr. Laveesh Bhandari andPayal Malik, Indicus Analytics

AgilityMob

ility


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Contents

Executive Summary 1

Scale and Scope of Migration 3

Impact and Challenges 10

Gains and Costs of Migration 13

Role of Stakeholders 15

Conclusion 17

Demographic dividend vs. talent shortage Social and political issues

Economic slowdown


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Executive Summary

India is already a majorplayer in the globalworkforce and themomentum of growth withinthe country is increasing

talent mobility domestically.While India's demographicspresent the country with thepotential to become themost prominent contributorto talent migration over thecoming decades, a numberof challenging and complexissues need to beaddressed to transform thispotential into reality.

Manpower's recently published white paper on theBorderless Workforce: 2008 highlights the great churnthat is taking place in international labour markets.Workers are migrating permanently or on a short termbasis, with the same company or changing employers,and changing occupations in search of careerprogression and improved lifestyles. Companies, in turn,are hiring internationally sometimes for employment ina single location and sometimes moving their employeesacross national borders. The world may not yet havebecome flat, but it is rapidly becoming borderless.

A significant contributor to this phenomenon, India isexporting talent internationally in a big way and isconsidered to be an imminent 'threat' around the world.India, of course, is not alone. As many of the world'seconomies are faced with aging populations, India findsitself with a youth bulge. Given its demographics and arapidly growing educated and English speakingworkforce, India is emerging as a major supplier ofinternational talent.

Internally, with aggregate national economic growthaveraging eight percent per annum, but characterised by

large regional variations, better work opportunities insome states are attracting those willing and able fromother parts of the country. IT professionals of Tamildescent form a large part of the Bangalore story, labourfrom Bihar is benefiting agriculture in Punjab, largenumbers are moving from rural to urban areas in searchof better earnings and lifestyles.

The growing mobility of labour in a global economy andthe consequential impact on population anddemographics, coupled with increasing securityconcerns, are underlining the importance of goodmigration management policies to transform this into an

efficient, orderly and transparent process. The questionis no longer restricted to whether migration should orshould not be allowed, but is shifting to the question ofhow to manage migration effectively to enhance itspositive effects on development while mitigating anynegative impact (MOIA, Annual Report, 2007-08).

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Migration has enormous potential to contribute todevelopment and alleviate poverty for a country likeIndia, but the process needs to be understood better ifpolicies are to be put in place that maximise gains from

migration. What will be the consequences of large scaleinternational migration of skilled workers andprofessionals on India's own talent needs anddevelopment? With 65 percent of the populationcurrently engaged in agriculture and with less than idealopportunity for education, training, and development ofsoft skills, how will a major chunk of the population beincluded in the benefits? How will India's growingworkforce be turned into a more employable one?

The issues involved are multiple and complex, andthrough this paper Manpower will help clarify thechallenges and opportunities of talent mobility in a fast

growing economy such as India. The analysis looks atthe scale and scope of migration both within andcross borders. It goes on to review the impact andchallenges in a number of areas such as talentavailability and employability of the workforce, the socialand political issues to consider, and the volatility causedby economic downturns that we are currentlyexperiencing. The paper takes a look at the gains andcosts of migration and makes suggestions on whatmore could be done by key stakeholders such asemployees, employers, and Government. Suggestionsfor building on what is already being done to convertIndia's demographic dividend into a competitive

advantage are provided in conclusion.

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The willingness of people to move from place ofresidence to another location is usually driven byeconomic and lifestyle aspirations. This is trueinternationally, as well as in India. However, the coreengine that powers migration is that of employment,and there are many different characteristics contained inthis broad term. Manpower recognises this (BorderlessWorkforce: 2008). There are different categories ofworkers, blue collar and white collar, with quite differentaspirations and patterns of movement. There is anotherdivide between skilled and unskilled employees. There

are two kinds of borders international borders, ofcourse, but also national boundaries geographical orsocial - that affect the movement of people and jobs.

International Skilled Migration

It is estimated that under a million people migrate out ofIndia in any given year. As per various governmentdocuments there are about five million Indian migrantsworking internationally. Other estimates put the figurehigher at about six million. Indian talent migration,therefore, is creating a significant impact on both the

host country as well as on India. Traditionally, the majordestinations for highly skilled Indian migrants have beenthe US, UK and Canada and that for unskilled, semi-skilled labour - and of late, professionals too havebeen the high income countries in the Gulf.

Scale and Scope of Migration

This is changing rapidly. Destinations such as Australia,New Zealand, and Singapore are also attracting Indianprofessionals. In the past, it was the constructionworker that characterised Indian talent movement tonon-English speaking countries. Now countries inEurope, as well as Japan, are becoming major recipientsof Indian skilled talent. In the Gulf, skilled talentmigration is steadily becoming as important as that ofthe unskilled.

The following graphs illustrate the trends:

Source: OECD

Figure1: Inflow of Indian Workers into Principal Destination Countries

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60

50

40

30

20

10

0

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Australia Canada United Kingdom United States


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6

In a very short period of time India has become one ofthe top sources of talent in a number of developedcountries.

None of this would have been possible withoutinternational governments actively recognising theimportant role that talent mobility plays in their countries.

Apart from having stagnating and ageing workforces,employers in developed countries need easy access tothe 'best and brightest' from around the world to attain acompetitive advantage in international markets. Forexample, in the nineties, the expansion of the US H-1Bprogramme, that targets specialty occupations, was

justified on these grounds. (Martin 2003). USimmigration data indicates that nearly 75 percent of all ofthe systems analysts and programmers are from India.

Across all recipients of new H-1B visas, India was the

leading country of origin, comprising almost half of all ofthe new arrivals in 2005. A number of othergovernments have also taken significant steps toincrease the inflow of Indian skilled talent into theircountries.

India leads in work permits issued to foreign nationals inthe UK, having surpassed the USA from 2001 onwards.

The majority of the work permits issued in the UK areacquired by IT and health professionals. Temporarybusiness visas that are nominated by employers in

Australia display a similar pattern. In the year 2005-06,India accounted for 10 percent of these visas. In this

case, top occupational groups were also in IT and ITrelated fields, though these sectors are not the onlybeneficiaries of Indian skilled talent migration.Physicians of Indian origin accounted for one in every 20doctors practising medicine in the US. India is also thecountry of origin of 27,809 of the 68,836 registereddoctors in the UK who earned their medical qualificationoutside the European Union (GMC, UK 2008). India isalso the second biggest exporter of nurses to the UK,

1after the Philippines.

Migration of Indian talent to non-English speakingdeveloping countries is also increasing. Significantnumbers of Indian professionals are now headingtowards new and emerging destinations in continental

Europe and east Asia. It is estimated that more than 60percent of those (primarily IT specialists) who have beenadmitted under Germany's Green Card Scheme since2000 are Indians. Also, nearly 10 percent of the totalnumber of IT engineers admitted to Japan during 2003were Indians (Sasikumar & Zakir Hussain, 2006).

This is only the beginning of a long term trend. Withdemographics indicating an ageing and stagnatingworkforce in most developed countries and somedeveloping countries, the need to supplement domestictalent with that from other countries will only increase.

International Low-skilled MigrationThe bulk of migration taking place from India is unskilledlabour. There are about five million overseas Indianworkers in this category all over the world. The Gulfhas traditionally been the recipient of a large number ofsemi- and unskilled workers, and the numbers continueto grow. More than 90 percent of these workers are inthe Gulf countries and south-east Asia. Figure 6 depictsthe annual outflow of labour from India. The outflow ofworkers has been rising consistently since 2000.

1Mixed feelings among Indian doctors asNHS turns 60, Deccan Herald, July 6, 2008


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Figure 6: Annual Labour Outflows from India

According to the MOIA, Annual Report 2007-08, about 670,000 workers emigrated from India with emigrationclearance in 2006. Of this figure, about 255,000 workers went to UAE and about 134,000 to Saudi Arabia. Outside theGulf region, Malaysia is also emerging as an important destination for Indian labour - approximately 36,000 workersmigrated to Malaysia that year. This is yet another example of new locations opening up for Indian talent

Source: Annual Reports, Ministry of Labour, GOI, Various Editions

[Note: This data pertains to workers requiring emigration clearance. The emigration permit ismandatory for unskilled and semi-skilled labour before leaving the country.]

7

900000

800000

700000

600000

500000

400000

300000

200000

100000

0

Labour Outflow

1990 99

1

1 9

192 9

19 3 9

19 4

991

5 919

6

1997

1998

1999 00

0

2 2001

2002

2003 00

4

2 005

2 00

2

6002

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Although about 70 percent of the Indian migrants to theGulf has comprised semiskilled and unskilled workers,the skilled and white collar category is becoming moreand more significant in recent years (Khadria, 2006).

This follows the economic structure of the hostcountries. In the years following the oil boom, largeinfrastructure investments and those in basic industry

led to the creation of great opportunities for low skilledlabour. However, with the advancement of the Gulfeconomies, requirements are increasingly focused onservices and high value added activities. Indiangovernment statistics reveal that the socio- economicprofile of Indian migrants to the Gulf has been shiftingsince the late eighties.

Consequently, countries such as the U.A.E. are alsofocusing on the skilled and professional categories.

Apart from doctors, engineers, architects, bankers andaccountants, many white collar workers are nowworking in government offices and public sector

enterprises. Other workers are engaged in gold,electronics, motor spare parts or textile trades,construction and hotel and restaurant management(Indian Council of World Affairs, 2001).

Despite this trend in the Gulf, the overall numbers ofmigrating low skilled workers are increasing. Thesesemi-skilled and unskilled workers are mostly temporarymigrants who return to India after their employmentcontract expires. Figure 7 shows the annual outflow oflabour to GCC countries.

Migration within India

There are many factors that drive migration but the bulkof domestic migration is for employment. Though morethan half of women who migrate do so due to marriage

and many children migrate with their parents, mostchoose to relocate on a long-term basis foremployment opportunities (Bhandari, 2007).Unlike international migration, government interventionplays little role in controlling the domestic movement ofworkers in India, as is the case in most countries.Locations that have higher incomes and more creationof opportunities tend to be the largest receivers of

migrants. Conversely, states that have low incomesand low economic growth tend to be the net suppliersof talent.

Consequently, states such as Gujarat, Haryana, Punjab,and Maharashtra are among the largest net receivers ofmigrants. And low per capita income and low growthstates such as UP and Bihar are the leading sources ofmigrating workers. Maharashtra tops the list with 3.76million net inflows of migrants, followed by Haryana(1.46 million) and Gujarat (0.81 million). On the supplyside, Bihar (-2.89 million) and Uttar Pradesh (-1.44million) lead as major states with net outflows of

migrants.

Growth of net migration in some states has beenphenomenal. Net migration in Haryana increased about3.5 times during 1991 to 2001. To a large extent, thiswas due to the rapid growth of areas surrounding Delhi Gurgaon being one of them. It almost doubled inMaharashtra during the same period. Gujarat (68%) andDelhi (35%) were other territories which experiencedlarge increases.

Among the major cities, as many as 16.4 percent of thetotal population of Delhi consisted of migrants in 2001

(arrivals in the period 1991-2001). Greater Mumbai andBangalore followed at 15 and 13.4 percent respectively.These are among the most rapidly growing urbancentres in post reform India.

Figure 7: Annual Labour Outflows to Gulf Countries

Source: Annual Reports, Ministry of Labour, GOI, Various Editions

300000

250000

200000

150000

100000

50000

0

Bahrain Kuwait Oman Saudi UAE

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005


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Figure 8: Growth of net migration of workers in selective states during 1991 to 2001

Source: Census of India 2001. Data highlights, migration tables.

Figure 9: Distribution of interstate migrant workers (in millions)

Source: Census of India 2001. Note: R-U: Rural to Urban; R-R: Rural to Rural; and likewise. Note: figures in parenthesis are percent of total

Rural to rural inter-state migration is also not insignificant (about 26%). Such migration is characterised byextremely low or no education levels, low skills, and agriculture related occupations. Urban migration on the otherhand is more likely to occur among those who are relatively better skilled and educated. As a result, manufacturing,trade, and services such as finance tend to be the more likely occupations.

9

350

inpercent

300

250

200

150

100

50

0

-50

-100

-150

MH DL GJ HR UP BH

172.8

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343

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9.00

8.00

7.00

6.00

5.00

4.00

3.00

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1.00

0.00

R-U R-R U-UU-U U-R

7.71(34)

5.98 (26)

4.15 (18)

4.90 (22)


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Impact and Challenges

Demographic Dividend and Talent ShortageIndia is perhaps the only nation which will have a youngworkforce amidst a large number of ageing economiesaround the world in the coming decades. It is estimatedglobally that there will be a skilled manpower shortageof 56.5 million by 2020 and if India prepares itselfproperly, it could have a skilled manpower surplus of

2approximately 47 million by 2020 . This presents Indiawith a unique opportunity to harness this dividendthrough skills development of the youth and otherinitiatives.

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2Eleventh Plan Document, Volume I, Planning Commission,

Government of India.

touched very few. The Eleventh Plan document of theGovernment of India reports that among persons aged15-29 years, only about two percent are reported tohave received formal vocational training and anothereight percent reported to have received non-formalvocational training.

India's transformation to a knowledge economy and theassociated change in profile of employmentopportunities has created a supply and demand gap inskills, particularly in the new economy sectors.

The numbers are large and the potential scale ismassive. The population for the age group 15-60 years

is expected to increase by 114 percent by 2025 andestimated growth in the population sector havingeducation at diploma/certificate/graduation level orabove would be as much as 237 percent. Growth inthe population sector having education at secondarylevel or below is likely to be at 170 percent.

In spite of this, India does not currently have thetraining and education infrastructures that canmeaningfully convert this demographic profile into anemployable dividend. On the one hand, skill shortagesare due to the general academic orientation of theeducation system, leading to low levels of employabilityof the educated. Moreover, 90 percent of schoolstudents drop out at different stages with very fewreaching higher education levels. Even for the lesseducated, vocational / skills training opportunities have

Compounding matters, the old economy sector alsofaces shortages of skills. A recent industry survey by the

Federation of Indian Chambers of Commerce andIndustry sheds light on the emerging skill shortagesscenario in the country. The survey highlights the largerequirement of skilled workers on the one hand andworld class professionals on the other. For instance, theIT sector may face a shortage of 500,000 technologyprofessionals by 2010. Also in the education sector, a25 to 40 percent shortage of faculty members indisciplines such as engineering, management,economics and computer science in central universitiesis anticipated. The survey further calls attention to thetalent shortages in sectors like health, engineering/heavy equipment industry, insurance, automotiveindustry, mining, textiles, civil aviation, environment andoil and gas. It is clear that current and anticipated futuretalent shortages exist across a wide range of sectors inIndia's economy.

Source: Report of the Technical group on population projections constituted by the National Commission on Population, May 2006

80+

70-74

60-64

50-54

40-44

30-34

20-24

10-14

0-4

10.0 5.0 0.0

% Total Pop

5.0

Females Males

AgeGroups

10.0

Figure 10: Population Pyramid 2026


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80% of new entrants to the workforce

have no opportunity for skills training.Against 12.8 million new entrants per

annum to the workforce the existing

training capacity is 3.1 million per

annum.

About 2% of Indias existing workforce

has skills training compared to 96% in

Korea, 75% in Germany, 80% in

Japan, and 68% in the United

Kingdom.

38.8% of the Indian labour force is

illiterate, 24.9% of the labour force has

had schooling up to the primary level

and the balance 36.3% has had

schooling up to the middle and higher

level.

About 80% of the workforce in rural

and urban areas does not possess any

identifiable marketable skills. Structure

and absence of quality consciousness

are said to be major reasons for the

current state of affairs.

Eleventh Plan Document, Vol I,

Planning Commission, Government of

India

Social and Political Issues

Rapid growth in one province can be sustained if it candraw on the skills of other states. But there is the

possibility of a negative outcome as well. Rapidmigration may change the social and culturalcharacteristics of a particular area. This can createdissatisfaction among members of the local community.

Moreover, as migrants are often willing to undertake thesame task at a lower wage than demanded by locals, italso creates competition between the two groups. Thiscan result in dual irony in high growth regions. Whilemigrants are able to find jobs that allow a better life,local residents find it difficult to find desired work andremain unemployed. The taxi drivers in Mumbai are avery good case in point. Locals are more familiar with

the city, and therefore should generally be better at thisjob than migrants. Driving a taxi, however, requiresirregular working hours, is physically and mentallytaxing, and is not the most desirable of jobs for localyouth. Consequently, most taxi drivers in Mumbai aremigrants.

The combination of these two forces can cause tensionbetween locals and migrants, and India has seen suchsituations in the recent past. There is the added risk ofpolitical escalation. If not dealt with in a mature manner,there is potential harm for the migrant as well as thehost economy and community.

All large cities of the world and all successful economiccentres have a history of inclusivity. Those which havetried to control the entry of people from other cultureshave limited their own economic potential and growth.

This is an aspect of domestic migration that India willhave to come to terms with. Currently, less than a thirdof India resides in its cities; this will shortly be greaterthan half. Large numbers will move from low growth tohigh growth states and from rural to urban centres. Themore differences between two areas, the more rapid themigration will be. If this is not handled properly, the

ramifications would be negative.


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International Slowdown

Over the past few months, the global economy has veryrapidly turned from a high growth phase to one of low or

even negative growth in many countries. As the first fewquarters of the recession pan out, firms across theworld will decidedly reduce new hiring, and even lay offtalent. According to the UN Secretary General, migrantworkers in construction and tourism are losing jobs inaffected countries and remittances have slowed. In hisspeech at the Second Global Forum on Migration andDevelopment in Manila, Mr. Ban Ki-moon has urgedgovernments to cooperate across borders to exploit thebenefits of the migration process even under suchconditions.

According to the Director General ILO, the current crisis

would hit sectors such as construction, automotive,tourism, finance, services and real estate the hardest.Mr. Somavia also noted that the new projections 'couldprove to be underestimates if the effects of the currenteconomic contraction and looming recession are notquickly confronted.'

In other words, the jobs will once again come at apremium. Governments across the world will bepressurised to build barriers against international talent.In times like these, inward looking immigration policiesmay be populist responses, but the dynamics ofmigration are so strong that the governments may not

make such knee-jerk reactions. Indians have started tofeel the heat of the slowdown with many top-end entrylevel international job offers being revoked. Althoughthere is likely to be a short to medium term impact ontalent mobility, the longer term view of increased workermigration remains strong.

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Only 5% of the Indian labour force in

the age group of 20-24 has receivedvocational training whereas the

percentage in industrialized countries

is much higher, varying between 60%

and 80%.

The illiterate and literate up to primary

level of education constitute a very

high proportion of the existing work

force, the two together account for

nearly 67% of the workforce#. The educated without professional

skills constitute 69% of the total

unemployed.

90% of school students drop out at

different stages.

Only 2.5 to 3 million vocational

education and training places are

available in the country.

Report of The Working Group on SkillDevelopment and Vocational Training,

Eleventh Plan, Planning Commission,

GOI


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Gains

Remittances

Migration, whether domestic or cross border, results in abetter matching of a person's inherent ability withemployment and income options. This results in greaterproductivity, output and earnings. The net result is awin-win situation where all three the employer, theemployee, and the family benefit. The success of theGreen Revolution in the states of Punjab and Haryanawas dependent upon cheap agriculture labour fromstates such as Bihar and Uttar Pradesh. While hard data

on domestic repatriation is unavailable, there are manyexamples in low growth, low income, states wherefamilies have been able to beat the poverty trap on theback of migration. However, some indirect evidencededuced from surveys on migration and consumptionand employment / unemployment by a research studyshowed, in 199293, that 89 percent of permanentmigrants sent remittances. The percentage of all ruralhouseholds receiving remittance income is also fairlyhigh in some regions of the country, one-quarter toone-third of households receive remittances.

Remittances are also the most immediate and tangible

benefits of international migration. India was the largestrecipient of workers' remittances, which amounted toUS$ 27 billion in 2007. Incidentally, remittances haveoutstripped net foreign direct investment and officialfinancial flows into India. With the profile of the migrantschanging to the highly skilled, remittances are onlyexpected to increase further.

Non-Resident Indian (NRI) deposits, for which incentiveshave been provided for attraction, have been the othermain source of attracting savings of Indian migrants.

Though it is debatable, in this era of free and fairmarkets, whether the NRI should benefit from special

privileges, the fact remains that the NRI deposits havecontributed significantly to the large foreign exchangesurpluses that India enjoys (S.K. Sasikumar and ZakirHussain, 2007).

Gains and Costs of Migration

Brain Gain and Brain Circulation

The rapid expansion of IT and the IT-enabled industry inIndia during the last decade is also encouraging a largenumber of Indians to return and set up businessventures, especially in key IT center in India likeBangalore. Such a trend of to and fro movement ofprofessionals and ideas constitutes 'brain gain'.

It is estimated that at least 35,000 IT professionals havereturned to either work in IT companies or set up

business enterprises in Bangalore alone (S.K.Sasikumarand Hussain, 2005). A recent comprehensive survey ofIndia's software industry showed strong evidence ofbrain circulation, with 30 to 40 percent of the higherlevel employees in India having relevant work experiencein a developed country (Commander et al., 2004).

About a third of GE India's R&D staff has returned fromthe U.S., while IBM India identifies half of the company'sPhD researchers as returnees.

In Pharma R&D as well, the evidence is very much inline with that in the IT sector. A survey conducted byDuke and Harvard university researchers in India found

that a majority of the PhDs in drug discovery by sectorleaders such as Ranbaxy, Dr. Reddy's Laboratories, and

Aurigene, received their degrees in the USA (HarvardLaw School, 2007).

Moreover, NRIs temporarily returning to India as intra-company transferees of multinational corporationsfacilitate the smooth setting up of FDI entities, acting asfacilitators that smooth the wrinkles that surface inmatching different work cultures. Though, specificexperiences apart, return skilled migration remainsrelatively limited and is often more a consequence thana trigger of growth in the home country. Companies like

Yahoo, Hewlett Packard, and General Electric openedoperations in India largely because of the confidenceinfused by the presence of many Indians working in theirU.S. operations.

3Ravi Srivastava and S.K. Sasikumar 'An overview of migration in India,its impacts and key issues', Migration development pro-poor policychoices in Asia, 2003.

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Costs

Brain Drain

Unless there is a clear surplus of skills and humancapital, large scale migration indeed has the possibilityof creating an enormous shortage of resources. Itshould be recognised that a large majority of migrantsdo not return. This is true for both domestic, as well asinternational migration, and is aptly reflected in the highrates of urbanisation growth within the country, as wellas permanent work visas and citizenship granted tocross border migrants from India.

The government, at the central, state, and local levels,as well as private institutions, invests substantialamounts in education and health. In the case ofprofessional and high human capital, the investment issignificantly higher than for a low skilled worker.

When considering talent migration, the new paradigm of'brain gain' and 'talent circulation' may be relevant insome fields for India but in others, like higher education,medicine and healthcare, this is not the case. Asteachers, doctors, nurses and medical professionalsleave the country, they create a serious gap in service.

Exploitation by Middlemen andAgents

Both domestic and international migrants are at risk ofexploitation and fraud by agents/contractors/employersand since new migrants are not accustomed to theirenvironments, it is difficult for them to access institutionsof law and justice. In some cases language barriersalso adversely affect access to such institutions.

Access to Basic Services

Migrants, particularly those who relocate within India,find it hard to access public facilities. This includesaccess to healthcare, education, ration shops, cleanwater and sanitation facilities. This is mainly becausemigrants lack basic identification and proof of residency,which is important for accessing basic public amenities(Laveesh Bhandari, 2007). Language barriers can oftencompound the problem.

A study on the vulnerability of workers in an industrialarea in New Delhi revealed that in the absence of properobservation of existing labour rights, migrant labourersare subjected to hazardous working environments.Working conditions in industries like cotton mills, smalltile factories, and salt fields expose migrant workers tooccupational hazards such as lung ailments, bodyaches and skin diseases. In many cases, lack ofknowledge of workers' rights combined with limitedaccess to facilitating institutions, causes undue hardshipand exploitation to migrants.

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Governments are increasingly recognising that talentmigration can contribute to overall economicdevelopment in many ways and this is heightening theirsense of urgency and responsibility to facilitate thisprocess.

Turning 'Demographic Dividend' into'Employable Dividend'

For India to benefit from the opportunities that are

emerging in the world, the Indian workforce needs to beappropriately educated, trained and skilled. Thegovernment recognizes this and apart from rapidlyincreasing expenditures on education, is also institutinga number of vocational and skills developmentprogrammes. However, given the scale of the issue,these efforts alone are unlikely to solve the problem.For this reason, ensuring greater private sector entryinto the educational and vocational training sector willbe critical. The establishment of internationaleducational and skills development organizations needsto be encouraged and facilitated.

Safe Migration

Complaints of cheating intending migrants byunauthorised agents, and exploitation and mistreatmentby foreign employers are often filed. Other suchmalpractice complaints include substitution of contract,underpayment and delayed payment of wages, anddenial of contractual facilities.

One way to begin to address this problem would be toreview the Emigration Act of 1983 and to clearlydelineate the roles and responsibilities of criticalstakeholders including central government, Indian

Missions, Protector General of Emigrants and recruitingagencies and employers. Even more important wouldbe for government to reinforce the implementation ofthe Act.

Identification, Database andInformation

Domestic migrants require proper identification oftemporary residence, as that can then help them seekwelfare and other services. This is currently an issue inIndia, as local government services such as basic health

and education are inaccessible for the large numbers ofdomestic unskilled migrants. A proper registrationsystem that identifies the migrant and his/her family assuch needs to be established in order to grant them

access to these services. This proper documentationwould also facilitate access to the judicial and policingsystems.

International migration has a different set of issues. Themigrant at times requires support from Indianembassies. Gaining an understanding of activities andoccupations of Indian migrants would enable bettersupport when necessary on the part of the governmentand its agencies internationally.

Bilateral agreements andliberalisation of policies

In the absence of the liberalisation of Mode Four(Movement of Natural Persons) in the WTO negotiations,there is another option available to increase the scale aswell as the scope of India's migration. Opening upIndia's borders to skilled international professionals,improving the spread of technologies in India, anddeepening its economic networks would facilitategreater talent migration from India overall.

Implementation and tightening oflaws dealing with domestic migrants

There is a range of laws governing the rights of migrantswithin the country. Although these laws exist, they areimposed infrequently. Documentation of prosecutionsand dispute settlements has been very weak(Srivastava, 2003). The laws need to be made in linewith the three imperatives of a globalising economy:minimize controls on free movement of people andgoods within and outside the country, reinforceimplementation of fundamental rights of migrants and

their employers, and ensure that proper enforcement ofthe laws occurs.

Overall, the role of the government needs to be tocreate an ecosystem that enables the efficient matchingof the skill sets that workers have to offer with those thatemployers require, irrespective of the locationaldifferences. This would require smooth and safemovement of individuals and employers across nationaland international borders, establishment of enablingorganisations such as educational and vocationaltraining institutions, as well as a legal and regulatoryregime that protects property, life and liberty for all while

minimising regulation and procedural bottlenecks.

Role of StakeholdersGovernment

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Employers

Employers, whether large or small, hiring internationallyor domestically, and seeking high or low skilled talent,

will continue to face significant challenges in terms ofavailability of specific skill sets. There are measures thatthey can take to try and mitigate the problems. Thereare instances of corporations experimenting withvarious scalable options such as training. Whethersourcing talent for Indian operations, or for internationalones, such training at the start would help employersreduce costs and increase productivity in the long run.Employers, both Indian and international, that haverecognised this, are taking a range of actions thatwould (a) reduce the difficulties in accessing appropriatetalent, and (b) ensure that the demographic dividendplays out as an employment dividend as well. The

efforts can be divided into three sub-domains, namely(1) Academia-Industry partnerships, (2) In-housetraining and (3) Enabling institutions of learning andskills development.

Academia-Industry partnerships

Recognising the need to access appropriately trainedmanpower, one of India's fastest growing banks, ICICI,has partnered with 27 professional institutes to hire100,000 trained people over the next five to sevenyears. In the IT sector, Infosys has similarly partneredwith Vishveshwarya Tech, which operates 135engineering colleges in the country. The company alsoprovides software training modules to students ofengineering colleges through its 'Campus ConnectProgramme'. IBM is building such partnerships andattempting to spread the use of open source software(OSS) in academic institutions. This will help thecompany source from India, OSS skill sets that are hardto find internationally.

Such academia-industry partnerships help build anecosystem where the supply is targeted to the demandfor specific skill sets. It enables firms to source talentinternationally, and is a strategy best suited for theirIndian operations.

In-House training

Across almost all sectors - services, infrastructure, andmanufacturing - companies are training new hirees in-

house before putting them on to productive tasks. Forinstance, management trainees in Hindustan Unileverundergo an intensive 12 month cross-functional trainingprogramme before they start work. India's largestautomobile maker, Maruti Udyog, spent close to Rs 80million in 2006 on training its employees across levels.One of India's largest IT companies, Wipro, has aproject management academy where managersundergo an intense six month programme comprised of20 behavioural models ranging from interpersonalrelations to leading subordinates.

L&T has set up construction skills training institutes

where students who have successfully passed their 10thand 12th class examinations are given training inmasonry, carpentry, electrical work. Unlike the aboveexamples, these students may not be hired by L&T, butmay be employed as subcontractors for its projects.

Yet, others are using their international affiliates andbranches. Accenture, for instance, follows a job rotationsystem and sends its highest performing seniormanagers to different offices around the world wheresenior Accenture leaders coach them.

This 'brain circulation' helps in the spread of knowledge

and methods across the organisation, and at the sametime, ensures that a strong and deep base of skills andcompetencies are developed within an organisation.

16


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India is sitting on what is potentially a great opportunity.The sheer size of its population, and particularly the ageprofile over the next few decades, gives the country asingular advantage. India has traditionally been a sourceof unskilled and semi-skilled labour. Over the past fewdecades, the migration of skilled workers andprofessionals has grown exponentially. Within thecountry, the movement of workers from less developedregions to faster growing states is increasing. Yet,ironically, the chronic shortage of talent for employers isin India. This is being aggravated with the country'stransformation to a knowledge economy. Employeeswith in demand skills see multiple opportunities, whilethose lacking relevant skills and training find themselveseither underemployed or unemployed. While manyemployers are aware of these challenges and aremaking investments in attracting, developing andretaining talent, they are largely unable to keep pacewith the increasing talent mobility. The government isfacilitating the growth and spread of education andbuilding of skills sets, as well as curbing workerexploitation. The issue here is one of intensifying effortswith the participation of all stakeholders.

For employers, recognition of talent migration as abusiness challenge should lead to other actions.Identification, classification and prioritisation of talentrequirements needs to be done as part of the strategicbusiness planning process. Shortlisting sources ofsupply is a logical next step. In doing so, employersneed to recognise, and indeed many are, that the righttalent may not always be available locally. Import istherefore becoming a necessary option. The dilemma isdetermining how many to induct, and in whatcategories, on a permanent basis. Creating a pipelinefor 'on demand' talent is becoming more and more of anecessity. Providing training and exposure will need to

be continuing areas of focus. Expanding the talentpipeline, through partnering academia, is a buildingblock for the future. To achieve this, corporations andindustries would do well to consider having theirprocesses managed professionally in these areas, withsupport from an employment services firm.

This paper has already covered the high level ofawareness of issues related to talent migration at thegovernment level. A number of commendable measureshave been taken or are underway by government toprotect migrant talent through selective legislation where

Conclusion

necessary. The most critical challenge, however, lies insponsoring and facilitating the education, training andbuilding the skills of the millions of young people who,as a result of legacy and location, continue to remainoutside the circle of opportunity. A number of initiativesare currently underway in these areas with governmentsponsorship, but a look at data from the PlanningCommission shows that so far only a fraction of thetarget population has been covered. The gigantic scaleand challenges of such a people development initiativecalls for a concerted effort with the involvement of allstakeholders, aided by experts with internationalexperience.

There are other areas where government intervention isseen as a necessity. To eradicate trafficking andexploitation, export of talent, particularly of unskilled andsemi-skilled labour, should only be conducted throughrecognised agencies. With migration becoming trulyborderless, India will need to look at working bilaterallywith other governments to ensure safe and transparentmigration, and reciprocate by finding a way to smooththe processes for inward movement of talent. Within thecountry, as local migration continues to grow, there is

need for consensus building to manage social issuesand tensions.

From the individual's perspective, when considering jobchanges, it is always advisable to go through channelsthat are bonafide and recognised. Furthermore, thosewith marketable skills appear to be currently well-positioned; yet it is worth bearing in mind that existingskills may not be in demand indefinitely. Employees,even those who are well placed and with sought-afterskills, would do well to periodically assess themarketability of these skills and invest in upgradingthem. Doing so will ensure the individual remains fit for

the race and an attractable candidate to employersboth within and across India's borders.

India's demographics point to the country being a majorplayer in international talent mobility. The country'seconomic growth will create huge demands fordiversified skills and require smooth movement ofworkers nationally, as well as abroad. Participation of allstakeholders is critical to making this opportunity areality.


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