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    Skill Mismatch and Returns to Education in Manufacturing: A Case of India’s Textile and Clothing Industry

    Kukreja, Prateek | September 2018
    Abstract
    Today, as India treads the path of becoming a knowledge economy, we face a paradox of intensifying skill shortages coupled with unemployment or underemployment among highly educated workers. While a shortage of skills (or under-education) is definitely a cause of concern, surplus education (or over-education) can also lead to underutilization of skills and further lower demand for low skill workers. Given this scenario, the paper attempts to measure the incidence and extent of skill/education mismatch and analyse the economic returns/cost to over/under education in one of India’s largest labour intensive industries: Textiles and Clothing (T&C). The study is based on the 68th round of NSS Employment and Unemployment Survey estimates. Using the over-education/required education/undereducation (ORU) models on a cross section dataset of individuals employed (as a regular salaried/ wage employee or as casual wage labour) in India’s T&C industry, we find that the overall educational mismatch ratio during 2011-12 was to the tune of 67.61%. Further, results indicate that while returns to surplus education is positive, it is less in magnitude as compared to returns to required education, suggesting underutilization of excess education. There’s also a significant wage penalty associated with each deficit year of education.
    Citation
    Kukreja, Prateek. 2018. Skill Mismatch and Returns to Education in Manufacturing: A Case of India’s Textile and Clothing Industry. © Indian Council for Research on International Economic Relations. http://hdl.handle.net/11540/8693.
    Keywords
    Quality Education
    Technical Education
    Primary Education
    Educational Systems
    Educational Reforms
    Industry
    Electronics Industry
    Commerce and Industry
    Development cooperation
    Training programs
    Vocational training
    Training methods
    Economic growth
    Training courses
    Technological institutes
    Labor market
    Educational aspects
    Compulsory education
    Economics of education
    Educational policy
    Industrial Projects
    Industrial Products
    Industrial Policy
    Manufacturing Industries
    Industrial Sector
    Educational tests and measurements
    Comprehensive high schools
    College preparation programs
    Transnational education
    Communication in higher education
    Fundamental education
    Capitalism and education
    Right to education
    Educational change
    Educational evaluation
    Show allCollapse
    Citable URI
    http://hdl.handle.net/11540/8693
    Metadata
    Show full item record
    Thumbnail
    Working_Paper_364.pdf (691.1Kb)
    Author
    Kukreja, Prateek
    Theme
    Education
    Industry
    Labor Migration

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    Copyright 2016-2021 Asian Development Bank Institute, except as explicitly marked otherwise