India has a problem that will get worse: Vembu

India faces an emerging employment crisis, mirroring the challenges China now grapples with, according to Zoho founder Sridhar Vembu. Despite boasting a robust manufacturing sector, advanced technological capabilities, and a merchandise trade surplus, China struggles to create meaningful jobs for its growing pool of educated youth. This is primarily because the country's traditional model of education - studying extensively before securing a salaried job - is becoming unsustainable in a rapidly transforming job landscape.

China's predicament is further compounded by an alarming trend: 70% of unemployed young people aged 20-24 in China hold university degrees. This suggests a significant mismatch between the skills young graduates acquire and the job opportunities available to them. China's young graduates, accustomed to following a predictable path of education leading to secure employment, find themselves caught in a dilemma as the nature of work is undergoing a seismic shift.

Vembu warns that a similar problem could afflict India in the coming years. Like China, India's burgeoning youth population entering the job market could encounter a similar predicament. The traditional employment model, which heavily relies on securing salaried positions following a formal education, may soon become obsolete due to advancements in technology, automation, and artificial intelligence.

These developments are expected to reduce the demand for certain categories of human labor, making it increasingly difficult for graduates to find suitable employment.

To tackle this looming challenge, Vembu proposes a significant shift in policy and mindset. He advocates for a greater emphasis on encouraging entrepreneurship and self-employment. He suggests that economies should move beyond the assumption that every educated individual must secure a conventional salaried position in a large corporate organization. Instead, more opportunities should be created for young people to start their own businesses, work independently, and build their own income sources.

Vembu also stresses the importance of equipping young people with practical business skills and an entrepreneurial mindset, along with their formal academic qualifications. This would prepare them to navigate a job market that is rapidly changing due to technological advancements.

For India, Vembu's warning serves as a stark reminder that merely increasing industrial capacity and technological advancement does not guarantee employment. The country's economic and educational policies must adapt rapidly to prepare its young generation for the jobs of the future, which may not be traditional salaried positions. India must also consider the potential of increasing entrepreneurship and self-employment as viable alternatives to secure long-term employment for its youth.