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COVID-19 impact: Demand for apprentices is on the rise

In FY22, apprentice hiring has seen a 40 percent growth especially across key sectors like healthcare & pharmaceuticals, ITeS, BFSI and e-commerce.

June 26, 2021 / 08:46 AM IST

Amid the ongoing COVID-19 pandemic which has triggered a job crisis around the world, the demand for apprentices has gone up.

National Employability through Apprenticeship Program (NETAP), the degree apprenticeship program from vocational skills institution TeamLease Skills University, has indicated that the overall intake of apprentices across India Inc has seen a significant surge amidst the pandemic.

Sumit Kumar, Vice President-NETAP, TeamLease Skills University said that in FY21, the hiring has increased by 35 percent.

He added that from April 2021 to now, hiring continues to spike by approximately 40 percent, especially across key sectors like healthcare & pharmaceuticals, ITeS, BFSI and e-commerce amongst others.

Apprenticeship refers to a skill development programme where a person is engaged by a company as a trainee to learn the trade or profession in exchange for a job for a fixed period.

In effect, it serves as a transition phase for a school/college student from the classroom to a job position. The apprentice also learns soft skills, work culture, ethics and organisational behaviour while undergoing training.

The Apprenticeship Act, 1961, states that any establishment having a workforce (regular and contract employees) of 30 or more is mandated to engage apprentices as 2.5-15 percent of their workforce (including contractual employees) every year.

India is estimated to have close to 65,000 apprentices. There is a big room for growth as Kumar said that companies are mostly employing upto 7-8 percent of their staff strength as apprentices.

When it comes to the gender mix, he added that contrary to the perception that women are hired only for office roles, sectors like manufacturing are also hiring women apprentices as machine operators.

Rise in demand across sectors

Kumar said that hiring apprentices is beneficial because they are locals. Also, he said that apprentices can become productive after just two weeks of training.

"We are seeing numbers improve further from June 2021 with lockdown-like restrictions being eased. There was also a shift seen from the candidates' side from 2020. Companies were on a pause mode on hiring and candidates took up apprenticeship as an opportunity to get started," he said.

Government rules have set stipends between Rs 5,000 per month for school pass-outs to Rs 9,000 per month for graduates or degree apprentices in any stream.

Companies could employ these apprentices for upto six to nine months and then also give them an opportunity to become permanent staff depending on their skills.

When it comes to the absorption rate of candidates that work as apprentices, Kumar said that 22-25 percent of these individuals are absorbed into full-time roles.

"Over the last three years, we are also sectors like banking and financial services also seeing demand for apprentices. These include non-banking financial companies as also financial technology (fintech) firms. Sales, collections and customer care are some of the roles in demand in fintech," he said.

With the onset of the festive season in the next five to six weeks, the demand could see a further rise with sectors like retail hiring apprentices, according to him.

The apprenticeship route has also enabled aspiring candidates to pave their way into formal employment. NETAP data showed that 95 percent of the certified apprentices are in formal employment.

"We have not even touched the tip of the iceberg and there is still a lot of untapped potential on this front. India’s vision is to reach 10 million apprentices in the next 10 years and it is crucial that we scale up our efforts to achieve this goal," he said.

Due to the COVID-19 led lockdown restrictions, Kumar explained that apprentices are also being hired actively in Tier II and Tier III locations.

Having started with a partnership with 20 employers in 2014, NETAP is currently partnered with 500 employers across all sectors and caters to about 140 job roles. Here, Kumar said that their programme has completed enrollments of close to 2.5 lakh apprentices since inception.

M Saraswathy
M Saraswathy is a business journalist with 10 years of reporting experience. Based in Mumbai, she covers consumer durables, insurance, education and human resources beat for Moneycontrol.
first published: Jun 26, 2021 08:46 am