1. Project Title: Youth Empowerment-
Making India’s Future Bright
Team Name: IIMB_IITD
Country: India
Mentor: Punit Asthana

2. Youth Unemployment in India
Youth unemployment is the lack of job opportunities for people typically in the age group of 15–24 [1]
12 100 10
10 80 8
10 10.4
8 60 6
8.3
6 4 1993-94
40
4 20 2 2007-08
2 0 0
0 0 5 10 15 15 to 20 to 25 to 35 to 45+
1994 2000 2005 Females Males 19 24 34 44
Unemployment rate as no. of education Age distribution of unemployment
Youth unemployment rate in India [2] years increases [3] rate in India [4]
160
140
120
100
80
60
40 Males
20 Females
0
State-wise distribution of youth unemployment rate in India [3]

3. Consequences of Youth unemployment
Fiscal challenges to nations: Youth unemployment costs the UK economy more than £155 million per week in
benefits payments and lost productivity. Lifetime cost of educational underachievement for today’s 17-24 year olds
will be £22 billion ($35 billion). [5]
Cost of Exclusion: Every 3 months of unemployment at age 22 is associated with an additional 1.3 months between
age 28 & 33. Persons who experience 26 months of unemployment before age 22 typically earn $1400-1650 less
than their peers at age 26, and $1050-1150 less at age 30. [6]
Resource wasted for developing economies: Limit inputs available urgently needed growth and makes it harder for
developing countries to realize the benefits of labor-intensive growth strategies. Failure in realizing economic
potential of young people; difference between sustained & faltering long term development . [7]
Increased risk for social pathologies: direct poverty effects on unemployed young people’s families include
considerable “cognitive, health, nutrition and psychological deficits” for children raised in poverty. [8]
Chronic unemployment is associated with increased incidence of criminal behavior . [9]
Increased crime: Periods of unemployment often means vulnerability to crime, drugs, and disease. Most crimes
committed by youth are committed during the afterschool hours. Lack of involvement in meaningful activities or
employment often leads to criminal activity for disadvantaged youths. [10]
• Direct loss, of trained experts, to under-developed & developing countries.
• India loses $2 bn a year because of the emigration of computer experts to the U.S [11]
Problem of • Indian students going abroad for their higher studies costs India a foreign exchange
outflow of $10 billion annually.
Brain Drain • Loss due to brain drain around 3% of the total skilled personnel available in India. [12]
• Average age of migrants between 20 & 40 – crucial from the youth's perspective. [12]
in India • Major reason is the wages paid in public & private sector: With exception of ICICI
none of the public sector finance companies have done a serious job of revamping
their pay scales. Similar is the case with private firms.

4. Causes of Youth unemployment
Education skill High population Socio economic Miscellaneous
mismatch & growth rate causes causes
-Increased cost of - Less Jobs as - Low literacy rate -Rigid labor laws
education especially compared to - Slow economic - Technology change
technical. population growth growth resulting less forcing shift from
- High number of - Inadequate export demands labor to machines
students of Education - Lack of awareness - Macro economic
graduating with - Low rate of about new job factor like recession
inadequate skills. Economic Growth policies & low investment
Rural Unemployment in India – A major concern?
• Characterized by seasonal unemployment and huge levels of migrant labor.
• Lack of subsidiary and other village industries; limited land & thus great pressure on land.
• Over dependence on nature as undeveloped and traditional methods of agriculture.
• Lack of education and ignorance about scientific and modern means of agriculture.
Why Youth fare worse than adults?
• Lack of information, networks, social capital and connections among youth.
• Lack of experience & credentials that address employers’ risk in making hiring commitments.
• Lack of available jobs suited to entry-level skills, demographic mismatch b/w seekers & employers.
• Lack of skills relevant to the workplace – lack of “21st century workplace skills” and focus.

5. Solution 1 - Financial Inclusion of Youth
Financial inclusion reduces the prevailing unemployment rate and the financial exclusion would mean people not using the
banking products of the financial sector. [13]
Current Status In India – Some statistics
• Number of deposit accounts per 1000 persons : Rural India -325 ; Urban India – 724 [14]
• Number of bank branches per 1000 km: India - 22.57 ; UK – 45.16 ; Korea – 65.02 ; USA – 9.81 [15]
• Number of bank branches per 1,00,000 people: India - 6.30 ; USA – 30.86 ; UK – 18.30 ; Korea – 13.40 [15]
Solution to the problem: 'Banking-correspondent is the only model to increase financial inclusion′ [16]
BC Model in India:
Introduced in 2006. Outsourced representative of bank in remote
areas. Work as the single person bank for the area. Key role is to
accept deposits and remit money.
Problems faced by the BC Model
• Operational Issues – cash handling and gullible client profile.
• Regulatory concerns – Interest capping & cash settlement issues.
• Social issues – Lack of financial literacy, awareness, exclusion.
Current Status of the initiative
• Around 40% of 72,000 villages have a BC model working.
• In Delhi, out of 113 unbanked villages have working BC model.
• In Haryana, of 1843 unbanked villages, 1100 unbanked villages
has already been provided banking facility as of March 2011.
Solution to the problems – Banking Correspondent Communication Architecture
• Local shop-owners appointed as BCs. Deposits specific amount of money in the bank. Each time transaction happens in
the village, pay/receive cash and credit/debit from their account. Solve the operational issues regarding BC model.
• Figure on the right shows the diffusion of innovation curve , depicting how the target segment needs to be decided for
this innovation. Currently it can be said to be in the innovator & early adopter stage.

6. Solution 2 - Access to work experience
Prior work experience is positively associated with an individual’s ability to obtain permanent work at a later date. [17]
• Temporary work is an especially effective tool in improving labor market outcomes for long-term
unemployed persons and others seen by employers as ‘bad risks’. [18]
• 10-13% improvement in long-term employment outcomes after 2 years for people who accepted
Past research
short-term jobs as a ‘stepping’ stone out of unemployment. [19]
• Impact of temporary work experience: Before engaging in agency work, 34% of applicants in
Sweden had prior full time work experience; after completion of agency work 85% obtained full
time jobs. [20]
• In Switzerland, the pre- and post- agency work employment numbers were 47% and 71%
respectively. And in France, the experience of agency work raised participation in full time work
from 11% to 66% [21]
• Series of internships, project work, temporary work, etc., structured in a low risk, low-stakes way so
as to give young people easy access to new opportunities without requiring long-term
How to achieve?
commitments from employers or creating full time or dead-end jobs.
• Role of private employment services firm in finding initial work experiences for young people with
limited skills and experience. These services can broker a series of short term work experiences that
increase young people’s chance of finding a full time job.
• Short term experiences also fit well into summer or semester-long intervals in a young person’s
ongoing education, so that work experience can be combined with or alternate with education, and
can influence study and training choices.
• Firm can also help young people build a portfolio of progressively challenging work experiences.
Thus a highly effective way of building their skills and employability over time.

7. Solution 3– Access to training programs for youth
What? Training programs focusing on training narrowly & intensively on the requirements of
specific, available jobs, and including a post-training placement component based on prior
hiring commitments from employers.
How? Training programs can be organized & managed by workforce intermediaries governments
or NGOs, or by employers themselves.
- Vocational training should be designed around the informal economy, where most young
working people are found in developing countries.
Key Features? Must be demand driven i.e. oriented to filling specific needs and actual vacancies
for local employers, and must prepare individuals for those specific, available jobs.
- Must be based on a firm employer commitment to articulate its skills requirements to trainers
and to work with program graduates. Post-employment counseling important.
- Repeated engagement with experienced employer partners who participate in program
design & the specification of skills requirements & have confidence in this process.
Employer’s benefits? Can help build capacity for organizations managing training programs, by
sharing executive experience and advice.
- Can contribute their own training and other resources, and improve the alignment of
training with their own specific job requirements.
- Can provide clear, skills-based specifications of the requirements and of their available
positions, and information on the number and timing of available openings

8. Solution 4 - Government initiatives
State and central government has brought many schemes to provide employment opportunities to the unemployed.
Measures implemented by Indian government to overcome unemployment
Prime Minister’s
Integrated Rural Drought Prone
Training for Self- Jawahar Rozgar Employment in Nehru Rozgar Integrated Urban
Development Area Program
Employment Yojana Foreign Countries Yojana (NRY) Poverty Eradication
Program (IRDP) (DPAP)
Program
Pradhan Mantri Pradhan Mantri Jai Prakash Rozgar The SwarnaJayanti Pradhana Mantri
Jawahar Gram Autyodya Anna
Gramodaya Yojana Gram Sadak Yojana Guarantee Yojana Gram Swarozgar Gramodaya
Samridhi Yojana Yojana.
(Gramin Awas) (PMGSY) (JPRGY). Yojana Yojanad
Problem: There are many good schemes implemented by the Government still the rate of unemployment
is very high in India.
Solutions for Government Initiatives
• Improvement of the employment exchange by granting more additional funds and more powers which would help
them to coordinate with private companies to provide maximum job opportunities.
• Providing improved educational facilities to citizens which would help in creating more employment
• Elimination of child labor as that will enable the right implementation of the “Education for all” campaign
• Create a network solution that will bridge the gap between opportunities made available and those opportunities
reaching to the individuals who require them.
• Increasing government funds to public sector companies would imply better functioning which will eventually help
people who are unemployed and thus decreasing the unemployment rate
• Increasing pay scales for employees who are working in government and public sectors will give less chance for people
to stay unemployed as they prefer to be unemployed instead of working for low pay scales
• Creating an independent ministry of employment and better tax transitions Implementing these steps strictly will
definitely help to decrease unemployment to maximum extent

9. Solution 5 - Youth Entrepreneurship
Small scale entrepreneurs (5-19 employees) are the primary engines of job growth in developing countries. [22]
Importance of Youth Entrepreneurship: Problems:
1. Turn Job seekers into job providers 1. Lack of motivation programs for parents
2. Help in creating sustainable employment to promote youth entrepreneurship.
opportunities 2. Lack of orientation programs for teachers
3. Raise a developing country to the rank of to educate the teachers on youth
developed country entrepreneurship education needs
Promoting Youth Entrepreneurship
1. Transforming educational system: Embedding entrepreneurship and innovation, cross-
disciplinary approaches and interactive teaching methods in education.
2. Mentorship program: Collaborate with corporates and successful entrepreneurs to mentor
individuals and help them convert their ideas into real products/services.
3. Build policy commitment: Policies should send a strong signal of support for entrepreneurship
and also set the strategic framework in which schools and universities can work to implement
programs and activities within their institutions.
Support from Industry/employers
1. Commit to purchasing from small-medium sized enterprises including youth-owned businesses.
2. Provide mentoring services and business advice to guide & support youth-owned businesses.
3. Endorse entrepreneurial initiatives by their own employees when their career development
makes them ready to go out on their own & provide marketing opportunities as appropriate.

10. Planned results & outcomes
Financial Access to Access to Government Entrepreneur-
Inclusion work- ex Training Initiatives ship
High. Biggest Very high. Directly link
Very high. Will directly Very High. Can affect all High. Will directly help
Potential target the most problems faced by employers with
the individuals & youth the individuals giving
Impact disadvantaged youth & youth today. Help potential employees
suffering from them an opportunity to
neutralize risks of and make them ready as
give them the capital. unemployment. become independent.
employers per the requirements.
High. Youth are highly
High. Done through the Average. Indian Average. Limited due to Vey high. Will be
enthusiastic and this will
nation wide spread BC industrial sector the lack of directly reaching to all
Reach model already in its have network effects,
largely unorganized. infrastructure & the population of the
helping to increase
early adopter stage. Difficult to approach. facilities in rural India. country.
reach.
High. Many young
Very high. BC model Very high. Firms High. If the model High. Due to the red
people today have their
currently in process. willing to adopt this developed properly, can tape & coalition govt., own ideas but
Feasibility Problems needs to be model. Win-win be scaled up very diff to enforce policy
incubation remains a
corrected. situation for all readily. changes.
problem.
High. Engagement with Very High. Requires Very high. Need
High. Partnerships Very high. Requires
Resources RBI & state govt. to with corporates and professional people/ public support, political trainers, mentors,
enforce BC Model. support and thus very capital, infrastructure
required industry houses trainers & adequate
Can be integrated with difficult to gather. and most importantly
required. infrastructure.
UID. innovative ideas.
Average. Need to
Low. Need to chalk out High. Will need to Very high. Need to chalk Very high. As the
Time design internship &
finer details regarding develop a sustainable out correct policy resources required are
required short term programs
the solutions to the model that integrates changes and then get very high, collecting
on the that can help the
the requirements of the
current problems faced them enforced in the them will require good
solution youth to get a small
by the model. youth & corporates. Indian system. amount of time.
experience.

11. References
1. Indicator 2: Youth Unemployment Rate , Youth Employment Network, International Labor Organization, 2011.
2. Indian Census data for 1994, 2000 & 2005.
3. Parasuraman S. , Vaidehi Y., “A profile of Youth in India”, National Family Health Survey, India, 2005-06
4. Mahendra S., Venkatanarayana M., “Youth Employment and Unemployment in India”, Indira Gandhi Institute of Development
Research, Mumbai, 2011
5. The Cost of Exclusion, The Prince’s Trust Update, 2010
6. The Cost of Exclusion, The Prince’s Trust Update, 2007
7. Dhillon, Yousef, “Inclusion: Meeting the 100 Million Youth Challenge”, 2007
8. Sum A., Pond N., “The Impacts of the 2001 National Recession and the Ensuing Jobless Recovery on the Employment of the
Nation’s Teens and Young Adults, Prepared for the National League of Cities, Washington, D.C., 2002
9. International Labor Organization, 2000
10. Crowder A.., “Negative effects of youth unemployment”, Politics, Issues & News, 2011
11. United Nations Development Program (UNDP ) report, 2008
12. Indians Abroad Roster, Scientific and Technical Personnel Division of the Council of Scientific and Industrial Research
(GSIR), 1962
13. Beg M., Financial Inclusion: Gateway for Poverty and Unemployment, 2011
14. RBI Basic Statistical Returns and Population Census, 2006
15. Beck T., Demirgu A., ‘Reaching Out: Access to and use of banking services across countries”, World Bank Policy Research, WPS
3754, World Bank, 2005.
16. Thorat U., “Banking-correspondent is the only model to increase financial inclusion”, 2010
17. Institute for the Study of Labor and OECD, 2002
18. Gerfin M., “A Microeconomic Evaluation of Active Labor Market policy in Switzerland”, 2002
19. Cockx, B. , Picchio, M., “Are Short-Lived Jobs Stepping Stones to Long-Lasting Jobs?,“ 2010
20. Youth Unemployment Challenge And Solutions, Manpower group, 2011
21. http://www.ciett.org/index.php?id=180
22. The World Bank’s Enterprise Surveys, International Finance Corporation, 2012