A media report on Monday said that the working-age population (people between 15 and 64 years of age) of the country has grown larger than the dependent population (children aged 14 or below and people above 65 years of age) since 2018. This bulge in India’s working age population is going to last till 2055, or 37 years from its beginning. Sounds like good news. Studies show that demographic dividend augurs well for an economy.
The report added that Japan’s demographic-dividend phase lasted from 1964 to 2004, and during this period the country experience rapid growth. China entered this phase in 1994 and in the 18 years since then there have been only two years when China could not cross the 8% growth mark. South Korea was also able to use demographic dividend for rapid economic growth. These examples signal that India’s current population structure presents a golden opportunity.
This potential economic growth will, however, depend on those in the working-age population actually working. No doubt, we have a massive workforce, but according to a Niti Aayog report, our formal trained workforce is only 4.69 percent of the total workforce. Every year, nearly 15 million youngsters enter the workforce, but another report points that 65-75% of them are not job ready or are unemployable. Again, according to a NASSCOM report, about 40 percent of our total workforce needs be reskilled.