Employment and Earning Differentials Among Vocationally Trained Youth: Evidence from field studies in Punjab and Haryana in India

Abstract

This article examines the employability of vocationally trained youth and estimates their earning functions and existing wage differentials by gender and social groups in both Punjab and Haryana. Using primary data from two selected districts (one from each state) with a sample size of 914 pass-outs from 19 training institutes, we find that lack of demand and skill issues restrict vocationally trained youth to obtain quality jobs in these districts. Hence, most of them are either found in contractual jobs with a lower level of earning or remain unemployed from the time of completion of their training. Moreover, significant earning/wage differences are noted across gender and social groups. Female and Scheduled Caste (SC) workers are discriminated by getting paid lesser than their male and upper caste counterparts, despite their similar training and skill endowments. Hence, it is suggested that government intervention is necessary to lower the existing skill gap and to improve the quality of jobs for vocationally trained youth to reduce the rising unemployment problem.

Employment Scenario in Indian Punjab: Some Disquieting Features

“…It could be because of various factors. One argument reported in the literature is related to the poor quality of training received by the skilled youth (Singh & Parida, 2020). The majority of the trained youth are not employable because they do not have practical knowledge of operating machinery in the factories (Singh & Kumar, 2020b).…”

“…Thus, there is a vast gap between the training imparted in vocational institutes and the market demand. Recent studies have highlighted that, although vocational education is provided to students without any additional financial burden, its interest has declined due to high unemployment (Kaur & Dogra, 2018; Singh & Parida, 2020).…”

“…Another argument related to labour demand in the industrial sector of Punjab is that majority of the industrialists do not directly hire skilled and trained workers; hence, they prefer those workers who acquire knowledge of handling machinery directly by observing from senior workers or gurus, (Singh & Parida, 2020). Alternatively, formally educated and skilled have a little market in the industrial sector of Punjab.…”

“…But current employment figures show that instead of increasing further, female participation in the labour market declined sharply in 2017–18 (Figure 2). It happened so because there has been a decline in employment opportunities for educated female youth at the local level along-with a sharp fall in urban real wages (Mehrotra & Parida, 2017), accordingly opportunity cost for the rural female to work in urban area has increased, which could have contributed negatively to female labour market participation in Punjab (Singh et al, 2020). In addition, the increasing participation of female youth in higher education, especially in rural areas (Brar, 2014), and a rising trend of international migration for searching better employment and education opportunities are also responsible for the observations (Jagat, 2019; Kaur, 2019).…”

“…Another argument is related to the quality of education and skill of labour force. According to some recent studies, the quality of education is worsening overtime and skill provided by the training institutes are neither best in quality nor in line with the requirement of the industrial (Brar, 2014; Kaur, 2017; Shergill et al, 2018; Singh & Kumar, 2020b; Singh & Parida, 2020). Hence, the absence of relevant training is one of the significant constraints for generating non-farm employment in Punjab.…”