Changing Times: When It Comes to Pay, Blue-Collar Jobs are Red-Hot
People with vocational skills that industry needs earn more than MBAs or engineers
Mumbai: Many of the 16 million or so Indian students writing Class XII board exams this year will aspire to get into one of the Indian Institutes of Technology and perhaps after that an Indian Institute of Management. Not many are looking to get into a polytechnic to learn a trade, especially after having completed 12 and more years of schooling. Could it be time for a rethink? Those who can’t make it to the premier engineering and management institutes seek admission into those lower down the order. The ones who subsequently enter the job market may be confronted by what seems like an anomaly — people equipped with skills that industry needs command better pay. At a time the government is intensifying its focus on the Skill India mission, statistics on 12 sectors from staffing solutions company TeamLease Services indicates that salaries of some vocationally skilled blue-collar job profiles exceed those of engineers by between 10% and 27%.
In six out of the 12 sectors — apparel, automotive, construction, food processing, gems & jewellery and logistics — the salaries for certain job profiles are at par, or even more than those of MBAs, particularly in the five-eight years’ experience category.
“Two fundamental factors are driving the transformational shift in payout structures — a gaping demandsupply imbalance and an acute shortage of skilled workers,” said Rituparna Chakraborty, cofounder of TeamLease, which runs a chain of skill development centres through IIJT. “Millions of blue-collar positions in demand have gone unfilled and the few that get filled have begun to command much higher salaries than earlier.”
It should be noted that the study excludes those with MBAs and engineering degrees from the top 1-2% schools, who plainly command a premium. But that accounts for a fraction of such schools in India, which has 3,000 of each.
Data for the study was culled from TeamLease pay to associates in the period 2013-15, job portals and National Skill Development Corp (NSDC) job descriptions.
According to Chakraborty, since most blue-collar workers are untrained, those that are skilled and in productive jobs get paid substantially more than before. Engineers, on the other hand, have suffered from two factors — poor quality of education and, stemming from that, lack of employability. About 80% of graduating engineers are regarded as unemployable, according to the Aspiring Minds National Employability Report, which is based on a study of more than 150,000 engineering students who graduated in 2015 from over 650 colleges. MBAs are paid more than engineers on average but several vocationally skilled job profiles are catching up, especially in the fiveeight years’ experience category.
According to a case study on the economic benefits of vocational education and training in India by the City & Guilds Group, while much of the developed world expects to see its labour force shrink by 4% over the next two decades, India’s workforce will increase by 32%. Estimates show that by 2022, the US will experience a shortfall of 17 million skilled persons compared with what’s expected to be a surplus of 47 million in India if the skilling programme meets targets.
Still, long-term employment trends, especially in manufacturing, can be unpredictable. Rising wages could price markets out of contention and automation could re- duce the number of jobs in factories.
Formal vocational education in India accounts for only 2.8% of studies currently pursued by youth aged 15-29, given the bias toward white-collar jobs. But that predisposition may not be justified based on the salary metric.
According to the TeamLease study, incomes of electricians in the automotive sector start at 15,100 per month, on par with those of qualified engineers at 15,200. In five-eight years that changes — an electrician earns about 49,400, a mechanical engineer 41,800 and an electronics engineer about 47,500.
In the construction sector, the starting salary of an electrician is Rs 16,200 compared with 14,800 for a civil engineer. In five-eight years, the former will get 54,800 compared with 43,300 for the engineer.
Specialist job profiles such as advance pattern maker (apparel), service supervisor (automotive) and master maker (gems & jewellery) offer salaries at par with MBAs (typically human resources or marketing).
The starting income of an advance pattern maker in the apparel industry is about 20,000 per month while an MBA in marketing earns about 17,400 and an MBA-HR about .₹ 17,200. Over five-eight years, the pattern maker’s salary rises to around Rs 55,100 while the MBA-marketing will get around 52,800 and the MBA-HR around 49,300.
“People are paying for skills and capabilities, not the educational degree,” said Narayanan Ramaswamy, head, education & skill development, KPMG India.