Enormous skill gap

05 Oct 2015


The demand for skilled labour is enormous and far surpasses the supply. —AFP/File
The demand for skilled labour is enormous and far surpasses the supply. —AFP/File

THE low skill level in the labour force is a major constraint in achieving economic growth, job creation, a competitive manufacturing industry, and poverty alleviation in Pakistan.

Yet little has been done by successive governments to improve technical and vocational education and training. The country’s existing technical and vocational education network covers a very small proportion of the population and the skill needs of the economy.

A vast majority of businessmen considers the shortage of skilled manpower as big a problem as their rising cost of production, and it affects their global competitiveness as much as the energy crunch or the security conditions do.

To overcome the skill shortages, many manufacturers have instituted on-the-job training at their factories.

One of the country’s largest home textiles and garments exporters, for example, spends a substantial amount of money to train industrial stitchers for his units. But he still doesn’t have enough trained stitchers to meet his requirements. Obviously, individual efforts are not enough to fill the skill gap in the economy.

Irfan Qaiser, chairman of the Technical Education and Vocational Training Authority (TEVTA) in Punjab, realises the crucial importance of a trained labour force for economic growth, exports and social inclusion. As a businessman, he is also aware of the impact of the unavailability of trained manpower on costs, productivity and competitiveness of the manufacturing and export industries.

‘The demand for skilled labour is enormous and far surpasses the supply. For example, a garment-maker requires 6,000 industrial stitchers annually and we are producing only 200’

“If we want to achieve sustained economic development, remain globally competitive and respond to technological changes, we have to provide market-driven technical and vocational education to our children,” he said during an interview with Dawn.

Punjab — being the largest province with an estimated population of 100m and home to a majority of the country’s poor — recently developed a Skills Sector Development Plan under which it targets training 2m young people for productive employment by 2018.

The first thing Irfan did at the TEVTA was to change the way the bureaucracy looked at technical education: creating new technical institutes without focusing on the disconnect between what is taught to children and required by the economy.

“When I took over, I found out that we already have a very large infrastructure of 384 institutes and colleges spread across the province, which makes TEVTA the largest vocational training provider in South Asia and South East Asia, excluding China. But this infrastructure remained unused for a better part of the day,” says the former president of the Lahore Chamber of Commerce and Industry.

The TEVTA is also collaborating with Akhuwat to provide interest-free loans of Rs50,000-100,000 to

its graduates to start their own businesses

So instead of spending the Rs2bn development funds allocated to the TEVTA for constructing more new colleges and institutes, he decided to divert the money to enrol more children and launch new short training courses that would help children get jobs or start their own business.

“We have launched 60 short vocational training courses spanning three to six months and started afternoon classes for optimal use of the TEVTA’s existing buildings. As a result, our enrolment has gone up to over 200,000 students from 85,000 in a few months. We now plan to start evening courses as well.”

The cost of enrolling 120,000-125,000 children has taken just 40pc of the authority’s development budget. “We are not only providing free training but also giving a stipend of Rs1,000 a month to each student.”

The TEVTA under Irfan — whose family owns a petrochemical plant in Sheikhupura and is in the rice export business as well — is also collaborating with a non-profit organisation, Akhuwat, to provide interest-free loans of Rs50,000-100,000 to its graduates to start their own small businesses.

“We are transferring Rs500m to Akhuwat from our development funds for this purpose. The idea is to implement a different kind of development through the provision of skills and training to our youth and help them stand on their own feet and contribute to economic growth, instead of constructing new buildings that will never be used to their capacity,” he asserts.

“What is the use of education and training if a person does not have a job?” He expects the job placement ratio of his graduates to grow to 85pc in less than a year from the current 65pc because of the introduction of market-driven training. The new courses are custom-made to suit the requirements of the market and industry.

“We are not producing enough skilled labour that can meet the requirements of local and international markets. But we are now moving in that direction in collaboration with businessmen and have started sending our children to employers to get training on their machines without any additional cost. The employers will not only help us train our students but provide them jobs on the completion of their training. The spillover will be absorbed in the market.”

The TEVTA has already signed agreements with several companies in different sectors like textile, food, furniture, paint, home appliances and packaging, most of which require 75 to 200 trained workers every month.

“The demand for skilled labour is enormous and far surpasses the supply. We are still not producing enough skilled manpower to meet the needs of the market. For example, a garment-maker requires 6,000 industrial stitchers annually and we are producing only 200. So the potential is certainly there.”

In addition to helping its graduates get useful employment in the country, the TEVTA is also assisting them get jobs in the Middle East.

“There is a massive demand for masons, electricians, plumbers, drivers and cooks in Qatar, the UAE and Saudi Arabia. We are in direct contact with employers, negotiating higher pay on behalf of our students, and eliminating the role of middlemen. We have sent 800 of our graduates to the Middle East in the last three months and plan to send another 10,000 in the next one year,” Irfan says.

However, unless the government makes skill-development a political priority, the possibility of the TEVTA going back to its old ways under bureaucratic influence cannot be ruled out.

Published in Dawn, Business & Finance weekly, October 5th , 2015

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