Talent shortage — global challenge, India’s opportunity

A FICCI-KPMG study highlights that by 2030, the world will face a shortage of over 85 million skilled workers, potentially costing USD 8.45 trillion in unrealized annual revenue. Given the global talent shortage, India needs to focus on ways to capitalize this demand for skilled labor.

The Global Skills Shortage and India’s Opportunity:

• Growing Demand for Skilled Workers: By 2030, a global shortage of over 85 million skilled workers is anticipated, potentially resulting in $8.45 trillion in unrealized revenue. India can seize this opportunity to tap into global labor demands, given its demographic advantage and skilled workforce.
• Key Regions with Workforce Demands: Major regions like the Gulf Cooperation Council (GCC), Europe, and Australia will face specific labor shortages. Healthcare and service sectors will see significant demand, while sectors like manufacturing and construction will be vital for the GCC and Australia.
• Emerging Sectors and Skills: Automation, AI, big data, IoT, and blockchain are identified as emerging sectors with growing demand. Indian workers skilled in these technologies could fill gaps in industries across these regions, contributing significantly to global economic productivity.

Barriers to Skilled Worker Mobility:

• Regulatory and Immigration Barriers: Complex visa processes and stringent work permit regulations hinder the smooth movement of skilled workers across borders. These barriers need to be addressed through international cooperation and policy interventions to ease mobility.
• Exploitation and Trafficking: Exploitative recruitment practices and human trafficking are significant threats to migrant workers' rights and safety. The Indian government is working on digital platforms and bilateral agreements to protect workers and minimize these risks.
• Skill Mismatches and Recognition of Qualifications: Indian qualifications, especially in sectors like medicine, are not universally recognized, resulting in underemployment. Efforts should be made to facilitate mutual recognition of qualifications through international collaboration and alignment with global market needs.

Strategic Measures for Capitalizing on Global Labor Demands:

• Sector-Specific Skill Training: Workforce training should be aligned with the needs of target regions, particularly for emerging sectors. This includes preparing Indian workers for industries like automation, AI, and health care to cater to international demands.
• Regulation of Recruitment Practices: Stricter regulations on recruitment agencies are necessary to prevent exploitation. Efforts should focus on ensuring the safety and rights of workers, particularly in high-demand regions like the GCC.
• Promoting Circular Migration and Mobility: India should prioritize temporary work visas and rotational workforce models to address labor shortages without causing demographic imbalances. Encouraging such models can enhance India’s position in global labor markets.

Practice Question:

Q. "India’s ability to address the global skills shortage by 2030 will play a pivotal role in its economic future." Analyze India’s strategies to leverage its workforce in the global labor market, considering existing barriers and emerging opportunities.