Downsizing, lack of training staff points to lower intake of apprentices in Q4 says Teamlease

• Twelve out of the 24 four industries see an increase in their net apprenticeship outlook while the remaining 12 see a decrease.
  
• Apprenticeship refers to a career pathway which enables individuals to learn and earn at the same time.
  
• End of tenures, downsizing workforce and lack of training staff are reasons for the decrease.
  

The Net Apprenticeship Outlook (NAO) for the January to March quarter witnessed a decrease of 3% over the previous half-year (July-December 2022), said a report by Teamlease Services.

This is marked by a significant decrease in NAO growth for certain sectors and cities.

The Net Apprenticeship Outlook is arrived at by subtracting the proportion of employers indicating that they will likely decrease the engagement of apprentices from the proportion of employers indicating that they will likely increase the engagement of apprentices.

However, 79% of employers are keen to increase their apprentices intake in Q4 2023, the report adds.

Apprenticeship refers to a career pathway which enables individuals to learn and earn at the same time. They can earn a wage, while gaining knowledge from structured learning and on-the-job training. This helps them enhance their resume with industry-recognized credentials.

Regulatory & economic challenges

Half of the 24 industries foresee an increase in their Net Apprenticeship Outlook, while the rest see a decrease. The maximum decline in NAO for the current quarter is noted in services including repair & maintenance, followed by infrastructure & capital goods; and aerospace & aviation.

“In the current quarter, we have also seen a dip in overall NAO due to regulatory and economic challenges that the industry has faced. To take apprenticeship to the next level, organizations will have to scale up their efforts, in order to stay ahead of unprecedented challenges,” said Sumit Kumar, chief business officer manufacturing, TeamLease Degree Apprenticeship.

Ending of apprenticeship tenure which is not being renewed (41%), downsizing workforce (35%) and non availability of apprentice training staff (31%) are reasons why employers see a decrease in engagement of apprentices.

For real time skill availability

The report finds that while 37% employers go for apprentices for real time skill availability, 31% do it to make hiring more cost-efficient, while for 23% the reason is business growth.

“As India Inc continues to recognize the prowess of apprenticeships in developing a strong talent pipeline, it's heartening to see that the proportion of employers willing to expand their apprentice engagement in the quarter has increased. Employers are realizing that apprenticeships with a degree linkage have better skill competencies,” said Kumar.

Also, while for degree apprenticeship (trade) 21% are likely to pay ₹15,000-20,000 per month. For graduate apprentices, 25% are likely to pay ₹20,000-25,000 per month.

Moreover, even other stakeholders are taking the initiative to boost apprentice adoption in India. For example, increased advocacy from the government has helped improve awareness. Additionally, the budget announced stipend support for 47 lakh youth over the next three years, on-the-job training through PMKVY, and the rollout of direct benefit transfer under a pan-India National Apprenticeship Promotion Scheme.

From a location perspective, all metro cities anticipate an increase. Hyderabad has the highest NAO (78%), followed by Delhi (74%) and Bengaluru (68%). 83% employers in Hyderabad, 82% in Delhi, 80% in Bengaluru and 81% in Chennai are willing to increase their intake.

Kolkata (42%) has the lowest NAO, with only 68% employers projecting to increase. Non metro cities are also projecting an interesting trend.

The NAO for Coimbatore (79%), Nagpur and Pune (76% each) and Ahmedabad (70%) continues to be on an encouraging trajectory. As many as 84% in Coimbatore, 85% in Pune, 86% in Nagpur and 83% for Ahmedabad foresee increased deployment.

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