Engineering Pipeline: Disproportionate and Disconnected

Engineering in India is an highly aspirational field of study and has grown rapidly in popularity. From 1997-2007, the number of AICTE approved seats of engineering grew from 115,000 to 551,000 (CAGR of 17% per year). The demand for engineering education mirrors the growth in the IT jobs starting late 1990s. Private higher education institutions acted in a proactive manner and contributed to most of the demand for engineering education.

However this expansion came at the expense of quality. On one side, there are reports of unemployment among engineers and on other side there are concerns of future unmet demand. Thus, there is a significant gap between what industry needs and what education is providing.

This recession has made the situation worse and radical quality assurance measures to address the problem of unemployment and skill gap. The primary reasons for current situation are:
1) Number of engineering institutions have increased at a fast pace
2) Demand by industry for engineering graduates has slowed due to recession
3) Quality of engineering institutions and students have not improved due to poor regulatory and incentive system

There is disproportional growth in engineering institutes creating a situation of oversupply for the academic year 2009-10. According to AICTE, 886 new institutions applied for this academic year which is 37% increase from existing 2388 engineering colleges.
Many states are facing a scenario where engineering seats available but there are not enough interest from students. For example, the Tamil Nadu Engineering Admissions counseling process may see more than 30,000 engineering seats to be vacant. With 91 new colleges starting operations in the State in one year, there is oversupply of engineering seats in Tamil Nadu.

Slower demand:
In the last one year, IT industry, which employs majority of the engineering graduates, have become cautious and slower in their hiring. According to NASSCOM, the IT industry employed nearly 2.2 million in 2009 fiscal, as compared to 2 million and 1.6 million in 2008 and 2007 respectively. The growth of IT jobs slowed to 11% from 2008 to 2009 after growing at 24% from 2007 to 2008. In absolute terms, there were nearly 160,000 lesser jobs created in 2009 as compared to 2008.

Poorer Quality:
Recent reports of corruption against regulator indicates that quality assurance and regulatory mechanism have simply failed. Many engineering institutions are finding loop holes in the requirements and working around the quality norms. The lack of faculty and administrative incentive for quality improvement further complicates the process. This is resulting in poorer quality of teaching and learning and corresponding lack of competencies among the graduates. According to a survey, by McKinsey only 25% of the Indian engineering graduates are suitable for employment with multinational corporations. A recent article in Time magazine refers to the skills gap in America. Imagine if America is worried about skills gaps what challenges India has to face.

Engineering education pipeline in India is becoming disproportionate and disconnected with the demand of the industry in terms of quality. In the process of providing access and meeting quantity needs, institutions and regulators have lost their focus on quality. According to McKinsey report, “Countries seeking to play a role in the emerging global labor market should concentrate on improving the quality of their talent, not just the quantity of educated workers.” Indian engineering education needs to wake up to this call for quality and industry can play a significant role in this transformation process.

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