India :Demograpics & Talent Shortage

Manjeet Kripalani writing on the the shortage of talent quotes L&T chairman Anil Manibhai Naik as saying - "Everyone is growing fast, and India is facing a talent shortage." As she writes, enterprises across the world are rushing to take advantage of the country's cheap and abundant labour force. But now India's domestic growth is taking off, creating unprecedented demand for workers with the right leadership and technical skills. "The engines of the services and manufacturing sectors are going simultaneously, and that's creating the shortages," says Shirish Sankhe, a partner with consultancy McKinsey & Co in Mumbai. Multinationals - from Pepsico and General Electric to Citibank and Accenture - are a part of the problem. As they seek to tap into India's growth, they have helped fuel an explosion in wages, especially in the tech and outsourcing sectors.For years they have offered Indians top salaries, opportunities to work abroad, and prestigious credentials, but as both domestic and foreign companies push deeper into new areas such as retail and industrial engineering, the bidding for qualified labor is heating up. Today, salaries for senior managers at some Indian companies nearly equal those at multinationals.
Look at the scenario depicted : India's talent shortages started appearing last year in technology and outsourcing, and attrition rates in those businesses today top 25 per cent annually. Pay for qualified managers in tech has shot up as much as 30 per cent, and now everyone, including big foreign companies, is scrambling.Salaries are going up everywhere - Textile factories to banks. Private firms are starting to offer courses for everyone from flight attendants to engineers.More private colleges are springing up, and some 450,000 new students are enrolled in engineering schools this year, up from just 250,000 last year. More than 35 million jobs shall be created uin teh next ten years by 2015, India's airlines will add 440 new planes by 2010,some 250 new malls expected to come up over the next three years. Some companies are looking abroad for solutions. Many industries are luring Indian expats from the West, especially those with skills in areas just taking off in India, such as retail and pharmaceutical research.
My Take : Obviously for India - among the top five primary forces to monitor - Infrastructure, Education, Healthcare, Agriculture would definitely find a place. India needs to do this fast enough - otherwise it may once again lose the opportunity to march ahead. As Vijay Kelkar points out countries go through a sequence where, at first there are many young people, then incomes go up, then birth rates go down, and then there are few young people. Every country also goes through a “demographic transition” where old people live longer, and richer people have fewer children: which puts a squeeze on the working population. But that middle period - when there are many young people - is a powerful opportunity for growth. After all India has a per capita GDP of $650, one of the lowest in the world. and If and only if India plays its cards right, it can be at $10,000 per person in 2035, roughly 30 years from now.