Reforms in the Apprenticeship Act are being looked forward to

Simplifying the Apprenticeship Act will make apprenticeships a major source of formal employment generation


The Apprenticeship Act is expected to be tabled at the monsoon session of the Parliament. Meanwhile, the National Employability through Apprenticeship Programme or NETAP, a flagship programme from TeamLease Services, has conducted a survey with employers to understand the hurdles in the current law that are affecting the apprenticeship ecosystem and needs immediate attention. The survey covered almost 200 employers, of which almost 100 per cent are expecting reforms that will simplify the ecosystem.

While 30 per cent are keen to simplification of regulations, 24 per cent are expecting execution guidelines to be simplified. About 24 per cent seek flexibility in implementation. In addition, 20 per cent respondents want apprenticeships to be brought under a single jurisdiction.

Sumit Kumar, vice president-NETAP, TeamLease Skill University, points out that “In India, generating formal employment is the biggest concern.” Due to apprenticeships, on the one hand, a skilled talent pool has been created for employers, from where they can hire, and on the other hand, it has allowed candidates to move towards formal employment and enhance their livelihood. He also says, “Apprenticeships can play a far more crucial role in employment generation, and for this, we need a more enabling apprenticeship ecosystem. Today, the ease of doing apprenticeships is not as seamless as other nations like the United Kingdom, United States, France, China, etc. For India to reach its vision of 10 million degree apprentices in 10 years, it has to bring about a change in the laws.” The survey only proved this further.

The five essential immediate reforms required are as follows:

Faster implementation of the New Education Policy, which has paved the way for apprenticeship embedded degree programmes.

Simplifying execution guidelines for universities to offer degree apprenticeship programmes, which will enable more universities to come forward.

Allowing more universities to offer online degree apprenticeship-linked programmes.

Creating a tripartite arrangement between apprentices, employers and the universities for better adoption and execution of degree apprenticeships. Under the tripartite arrangement, the university can act as a facilitator both on the demand and the supply side, by playing a much larger role as an academia partner, an apprenticeship advisor and a TPA.

Expanding the scope of TPA to take up additional administrative responsibilities, to add bandwidth and to enable more MSMEs and similar enterprises to take up apprenticeships. This will also further scale up apprenticeships.

Reducing the regulatory complex in the ecosystem by bringing various apprenticeships, traineeships and other practical training, under one jurisdiction instead of multiple governing bodies

Simplifying execution guidelines so many more organisations can come forward and engage with apprentices. Currently, only 20,000 enterprises in India engage with apprentices. Data from the 6th Economic Census (2013-14) indicates that if India added 20 lakh apprentices every year instead of 2.5 lakh, two lakh people would already be in formal employment (considering 10 per cent minimum absorption rate). Higher absorption rate would yield even better outcomes.

There has been improvement in apprenticeship adoption in the past few years. From 5,657 registered establishments for apprenticeships in 2015-2016, there are 1,20,000 registered establishments as on January 2021. While there is a significant increase in overall registrations, execution has not been at par with this increment. We still have a lot of untapped potential when it comes to apprenticeships.

According to Kumar, since apprenticeships today are an important part of the hiring strategy and they help organisations to optimise costs and improve productivity, reforms in the Apprenticeship Act are essential for faster and better adoption of apprenticeships in India.

Introduction of additional benefits and subsidies for apprenticeships, under NAPS 2.0 will also be advantageous. Presently, 25 per cent subsidy is applicable on stipends and 50 per cent on training. The need is to create a subsidy structure suitable to the segment/size of the organisations.

Reforms will ensure that apprenticeships will facilitate formal employment generation in India.

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