Saturday, August 04, 2012

Academic factories in India churn thousands of engineers, barely 10% worth employing

Ashish got thrown out of the interview when he was shown a Vernier calliper and he called it a screw gauge. A mid-sized company had come to his engineering college in Bhopal to recruit fresh graduates. But the interview began on a bad note. Realisation soon dawned on Ashish that his four years in the college and the lakhs his family had spent on his education had been a total waste. Not the one to be deterred, he used those years to good advantage when film maker Prakash Jha came to the city to shoot for Aarakshan: Ashish brought in the extras — students from his college.

In one of the several engineering colleges that have come up in the outskirts of Chennai, Sentahmizh studies mechanical engineering. He hails from Ariyalur, a small town in southern Tamil Nadu, and admits that he doesn’t understand a word of what his teachers say, learns by rote and studies just enough to pass. He can’t speak English. The college, when he was seeking admission, had spun fantastic tales about multinational corporations falling over each other to recruit its students. Sentahmizh suspects that might never happen. He may soon join the ranks of unemployed engineers.

Carlos Ghosn may have marvelled at India’s frugal engineering skills, the fact is that a vast majority of the country’s engineering graduates are unemployable. Many engineering colleges are just churning out deadwood. Aspiring Minds, a company that works in the field of human resources, last year surveyed 55,000 students who had graduated in 2011; it found that just 17.45 per cent were directly employable in the information technology sector, the biggest recruiter of engineers these days, without any training.

When it came to direct deployment on projects, the number fell sharply to 3.51 per cent. And in IT product companies, which require higher skill sets, it slid further to 2.68 per cent. A few days ago, PurpleLeap, a Pearson and Educomp company, released the findings of its survey of 34,000 students from 198 engineering colleges across the country: only one out of ten graduates from Tier 2, 3 and 4 colleges is readily employable, and one-third are unemployable even after training. The survey, mind you, was restricted to students who had done well academically.

The tab for the poor output has to be picked up by the employers. IT companies, according to analysis done by NASSCOM and Evalueserve, spend $1.2 billion every year on training. Had the engineering schools done their job properly, this money would go straight to their bottom-line. If you have invested in IT stocks, this should worry you. Tata Consultancy Services (TCS), India’s largest provider of IT services, spends 2 per cent of its turnover ($10 billion in 2011-12) on training. It is now investing Rs 10 billion in a training facility for 15,000 people in Thiruvananthapuram. Infosys’s Mysore campus has trained 100,000 fresh graduates so far, at a cost of $6,000-7,000 per employee. That’s a whopping $600-700 million knocked out of the company’s profits over ten years. Incidentally, the campus started with a module of 14 weeks which got extended to 17 weeks and now stands at 23 weeks. “There is definitely a gap between what they study in college and the skills they need at work,” says Infosys Senior Vice-president & Group Head (Education & Research) Srikantan Moorthy.

There are 1.5 million engineering seats in India today, up from 500,000 five years ago. This is way beyond the demand for engineers. Himanshu Aggarwal, the CEO and co-founder of Aspiring Minds, says that the IT sector absorbs around 200,000 engineers in a year, and the demand from the other sectors can’t add up to more than that. If one-fifth seats go unfilled in engineering colleges, that leaves 800,000 jobless engineers in a year. But all of them may not join the ranks of the unemployed as many get enrolled in business schools. That’s another Pandora’s Box: there are over 3,000 of them in the country, many not more than holes in the wall. Some others take non-engineering jobs.

Shantanu Prakash, Managing Director of Educomp Solutions, says that there was a shortage of engineers in the country a few years back and that precipitated a mad scramble amongst businessmen, big and small, to set up engineering colleges. “And now, all of a sudden, there is a glut,” he says. From almost zero a few years ago, private colleges own almost 92 per cent of the engineering seats in the country — such has been the rush. There are 35 colleges in Bhopal alone. In Madhya Pradesh, there are 200 engineering colleges with over 100,000 seats on offer. The state that has seen maximum growth is Andhra Pradesh — it has 671 private colleges that offer 320,000 seats.

Engineering education is regulated by the All India Council for Technical Education (AICTE). It has a fairly stringent check list that all engineering colleges need to fulfill: not less than 2.5 acres of land, not more than 300 students per acre, corpus of at least Rs. 10 million for operational expenses, student-teacher ratio of not more than 15, student-personal-computer ratio of at least 4, etc. But that’s hardly proved a deterrent. Setting up an engineering college can cost upwards of Rs. 150 million, depending on real estate prices, and payback happens in seven years. On the other hand, the demand will never see a slowdown. Indian parents, it is universally acknowledged, never flinch before spending large sums of money on their children’s education. Higher education in India is immensely valued. That explains the glut.

And it’s severe. Of the 320,000 seats in Andhra Pradesh, says an education consultant based in Hyderabad, more than 120,000 will go vacant this year. In Maharashtra, 30,000 of the 110,000 seats on offer went vacant last year; this year, the number is expected to climb to 40,000. Some colleges have appointed touts to get students. Business Standard contacted two such agents, one in Ghaziabad and one in Mumbai, to secure admission in some reputed engineering colleges in Delhi and Pune. The admission was guaranteed, albeit at the cost of a few hundred thousand rupees. Some engineering schools are ready to shut down and cut their losses, and quite a few are up for sale. Though AICTE reduced the minimum marks required in Class XII, to be eligible for admission in an engineering college, from 50 per cent to 45 per cent in 2010-11, it hasn’t helped — there are no takers for a large number of seats. Moved obviously by the plight of these colleges, the Maharashtra government wrote to AICTE earlier this year not to approve any new college in the state. Still, AICTE has given its nod to 11 new engineering colleges!

AICTE is actually in no mood to relent. Shankar S. Mantha, its chairman, is convinced the country needs more engineering colleges. “Given the low gross enrolment ratio of India (18-20 per cent), there is a need to make available more higher education opportunities for this huge chunk of students who remain outside the system,” says he. It is only two years later that the council will revisit the issue — that’s how long it takes to build an engineering college — when the colleges approved now will be up and running. Besides, says he, some redundancy needs to be built into the capacity as some streams lose favour and others gains currency. Mantha is convinced that engineering colleges will run out of seats once Indian students who go abroad to study prefer to do so in India. “Even in the US, the top six or seven management institutes are all full; but in some of the better institutes, around 50 per cent of the seats are vacant. I expect in another year or so the entire sector will undergo a sea change and you will find more institutes will be needed,” he says.

In the bargain, the quality has hit rock bottom. The Aspiring Minds employability study had found that states with fewer engineering colleges produced more employable engineers. There is therefore an inverse correlation between quantity and quality. Prakash of Educomp says that it is a highly regulated sector where colleges often cut corners to stay afloat. AICTE fixes the admission norms, the fees that colleges can charge and the salaries they can pay their teachers. “It’s a business where the input costs as well as the output costs are controlled,” says Prakash who runs an engineering college in Greater Noida.

As a result, the infrastructure of many new colleges is poor and the faculty inexperienced. Worse, everybody involved seems to acknowledge it. “Do they (the new engineering colleges) have trained and skilled faculty to teach modern courses,” Madhya Pradesh’s director of technical education, Arun Nahar, asks. Several schools have hired those former students as teachers who failed to get jobs outside. Badam Singh Yadav, who runs the IES Colllege of Technology in Bhopal, says most of his time is spent grappling with government rules and solving the “petty” issues of his students. “Does anybody care,” he says with fair bit of irritation, “that most of our students come from a rural background?” Engineering students in Chennai say the teachers often lack the motivation to help them out.

Apart from technical knowledge, most graduates are woefully short on soft skills. Wipro, says Senior Vice-president & Global Head (Workforce Planning & Development) Deepak Jain, runs a 12-week course for fresh graduates to upgrade their technical as well as soft skills. Ajoy Mukherjee, the global head of human resources at TCS, finds that engineering graduates lack soft skills such as the ability to work in a team and communicate effectively more than technical knowledge. The company’s three-month training programme, which every recruit has to undergo, looks to address these gaps, and focuses on converting students to professionals, says Mukherjee. “The inability to communicate is a serious concern, especially not being able to talk in English, form grammatically correct sentences, etc. When 94 per cent of your revenue comes from overseas, it is essential that you know how to communicate in English,” he says.

A recent report by Aspiring Minds, based on a study of 55,000 students from 250 engineering colleges, said 25-35 per cent students are unable to comprehend English. That shouldn’t have been a problem, except that most books and instruction manuals are in English. Only 57 per cent can write grammatically correct sentences in English, less than 48 per cent understand “moderately sophisticated” words, and almost 50 per cent possess grammar skills no better than a Class VII student. Not more than 30 per cent of the students, who go through stress and exhaustion while preparing for engineering college, are acquainted with the word “exhaust”. “Absurd” is a word not understood by 50 per cent. It’s a mess out there.

Source: Business Standard, August 4, 2012
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