India's employability crisis: Why degrees aren't enough for today's job market

The Hindu

11-06-2025

Across India, academic milestones often arrive with high expectations and critical decisions. As students progress through the education system, whether completing school or preparing for college, they and their families are faced with choices that influence not just career paths, but also financial security, personal aspirations and social identity.
In the midst of this transition, most conversations revolve around what to study next. However, there is a deeper and more urgent concern that often goes unnoticed. The real challenge India is grappling with is not just unemployment. It is the issue of employability. This concern is not limited to individuals or households; it affects industries, educational institutions and the nation's economic future as a whole.
Let's look at the numbers. Every year, over 1.5 crore graduates enter India's job market. Yet the India Skills Report 2024 reveals that only 46% of them are considered employable by industry standards.
The Centre for Monitoring Indian Economy (CMIE) reports youth unemployment standing at 16 percent, even as companies struggle to find candidates with the right skills. Clearly, the problem is not just a lack of jobs; it is a mismatch between what education produces and what the market needs.
This mismatch is especially risky given India's youth bulge. With over 50 percent of the population under 25 and 65 percent under 35, India has one of the world's largest pools of working-age people. This presents a potential 'demographic dividend' that could propel the country toward becoming the world's third-largest economy by 2028. But if these young people are undertrained or underprepared, they risk becoming a demographic liability instead, fueling underemployment, frustration and even social unrest.
Why the mismatch
Why is this happening? Part of the issue is the rigidity of educational choices. For decades, students have followed well-worn academic paths: after Class 10, over 55% opt for Science (usually aiming for engineering or medicine), around 25–30% go into Commerce (B.Com, CA, BBA), and only 10–15% choose Humanities. After Class 12, most continue into familiar undergraduate programs, whether or not these truly match their abilities or interests.
However, the fastest-growing job opportunities today are in emerging sectors: Artificial Intelligence, cloud computing, cybersecurity, fintech, biotechnology, digital marketing, green energy and agri-tech. According to National Association of Software and Service Companies (NASSCOM), India is expected to create 90 lakh new jobs in digital and emerging technologies by 2030. Yet fewer than 20 percent of students are actively preparing for these fields, partly because schools and colleges are still stuck in rote learning and outdated curricula.
For instance, consider a student who graduates with a first-class degree in electronics engineering but struggles to find a job. It is only after completing a short-term certification in data analytics, a subject never covered during college, that they manage to secure a position at a tech startup. Stories like this reflect a broader reality and highlight the urgent need for India's educational institutions to move beyond textbooks and degrees, incorporating practical skills, internships, and industry exposure into the core of learning.
The National Education Policy (NEP) 2020 emphasizes skill development and greater flexibility in learning pathways, aiming to better prepare students for real-world careers. However, its implementation has been uneven, particularly outside major cities.
For many students, access to professional career counseling is limited or entirely absent. As a result, choices are often guided by family expectations or societal norms rather than a clear understanding of individual strengths, interests, or market trends. Unless students and institutions actively respond to the changing demands of the workforce, the promise of the NEP may remain unrealized.
Studies by McKinsey & Company suggest that improving employability by just 10 to 15 percent could add between $200 - $250 billion to India's GDP over the next decade. At the same time, global reports from the World Economic Forum highlight that countries such as Japan, Germany, and South Korea are facing significant labor shortages due to aging populations. This creates a unique opportunity for India's young workforce to become a major exporter of skilled talent, but only if they are equipped with the right skills and training.
To bridge the gap, India needs a coordinated national push. Colleges must build stronger industry partnerships for apprenticeships and problem-oriented projects. Platforms like Skill India and Pradhan Mantri Kaushal Vikas Yojana (PMKVY) must expand their reach, ensuring even rural students can access cutting-edge training. Families need to embrace lifelong learning, where upskilling and reskilling through short courses, online certifications, or modular programs, even for mid-career professionals.
Strategy for students and parents
For students at this crossroads, the key is to think beyond marks. Ask yourself: What are you passionate about? Where are the new opportunities? A student interested in Biology doesn't have to limit themselves to Medicine; they could explore Biotechnology, genetic research, health informatics, etc. Someone good at Math doesn't have to stick to Engineering; they could venture into data science, AI, quantitative finance, etc.
And for parents: support your child's curiosity and adaptability. The most successful careers of tomorrow may be in fields that didn't even exist ten years ago.
As the results season sweeps across India, let's widen the national conversation. It's not just about who scored how much, or who gets into which college. It's about whether we are preparing a generation that is ready, ready not just to find a job, but to shape the future of India.
Because the real question isn't just 'What will you do after Class 10 or 12 or a degree?' It's 'How will you help build the India of tomorrow?