A serious problem is staring India’s higher education in the face, but we just aren’t seeing it. It’s about the misalignment between education and employment.

Unemployment among the educated is high - and rising. But even the existing employment opportunities are not matched by the number of employable people. In the IT sector alone, where exports (currently Rs 107,000 crore) are projected to touch Rs 285,000 crore by 2010, about 20 lakh new jobs will be created. Yet, NASSCOM estimates a shortfall of 5 lakh employable graduates.

This paradox was highlighted by two recent statements. Microsoft CEO Steve Ballmer said in India last month that, to be employable worldwide, Indian graduates need more “hands-on” practical training. NASSCOM president Kiran Karnik was more blunt. Shake up the university system, he said at a vice-chancellors’ conference in Mumbai last week.

Of the 30 lakh graduates added to the workforce annually, the IT and ITES sectors can absorb only 20-25 per cent of our engineering graduates. “We can’t employ the 26th candidate because he or she is just not employable,” Karnik observed. The employability of non-engineering graduates is even lower —only 10-15 per cent, for they lack “technical and soft skills which employers look for.”

Since the university system is not making graduates employment-compatible, many IT companies have to spend substantial resources to re-train fresh recruits. Infosys has established a mega-size campus in Mysore to re-train, at a time, as many as 10,000 new recruits. Similarly, TCS has launched a Talent Transformation Initiative to train thousands of science graduates into software professionals. However, only big IT companies can make this additional investment. Small ones have to make do with graduates who are mostly, for no fault of their own, not up-to-the-mark.

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