Skilled Workforce for Skilled Ports: Examining the Impact of Government Skill Development Programs on Indian Port Labor

Posted: March 25th, 2023

Skilled Workforce for Skilled Ports: Examining the Impact of Government Skill Development Programs on Indian Port Labor
1. Introduction
The world’s largest democracy, India has an ancient maritime heritage. The importance of ports and shipping to the Indian economy since ancient times has been well accepted in India. The birth and growth of Indian shipping is closely interwoven with major ports on the western and eastern coasts of India. An important characteristic of this industry is its concentration in few areas. Given the basic importance of port and shipping activity to the Indian economy and the potential for generating increasing employment, there is no arguing the fact that upgrading the Indian maritime infrastructure is imperative. This in fact has great relevance today, in the context of the major government initiative, “The Sagarmala Programme”. A project this vast will have many positive and negative impacts on the economy and society. One such important issue related to port activity is the nature of employment it generates and the consequent quality of life for the people depending on it. An attempt to understand and analyze this in the context of India’s earlier and subsequent port development is an interesting and relevant study in labour anthropology. This study is a report of one such exercise on the east coast of India in Visakhapatnam, Andhra Pradesh.
1.1 Background of Indian port labor
Current and future skill and knowledge requirements of port workers.
Identify skill gaps and to analyze methods of skill formation (training) and HRD for reducing skill shortages.
Measurement of effects on employability and quality of employment.
Identify the changes in the mix of employment and criteria and constraints enhancing efficiency of productivity.
Ergonomics and impact of different types of technology on health and safety of port workers.
The history of Indian port labor is historically linked with the maritime trade segment. A developmental study of cargo handling acquires special significance in the context of the developing countries where the structure and pattern of development of the economy and the level of technology differ from the developed countries. As a result, it has important bearing to analyze the status of port labor in context to the increasing mechanization and technological advancements. The first major attempt in this direction was made by National Productivity Council in 1991 to study the existing manpower, productivity and training characteristics of major ports. The findings of the study revealed several infirmities in the existing arrangement of manpower and productivity, and brought out urgent need for review of depth and the nature of the problem with a view to evolving solution. This led to the setting up of a Task Force by the Planning Commission to recommend measures for improving the productivity of Port and Dock Workers with a term of reference to take stock of the present skill levels and adequacy Human Resource Development (HRD) programs to meet the future skill requirements. The task force has identified following broad areas of work calling for further scrutiny and analysis:
1.2 Significance of skill development programs
Recently, there has been an increased demand for skilled port workers to engage with a ‘new’ form of work driven by technological change and competition. This demand comes from port and government authorities who seek a higher skill workforce as a precondition for port privatization and from labor unions seeking to safeguard employment and conditions of work. This problem, however, has been compounded by changes to national education and apprenticeship systems and a decline in traditional forms of casual learning on the wharf. The result has been a growing divide between the existing skills of today’s aging port workforce and the skill requirements for new port work. This situation has been recognized as a critical impediment to port performance and a growing source of industrial conflict.
The Indian port sector has evolved considerably over the past two decades in response to changes in global trade and shipping. There has been significant national policy interest in recent years focused on modernising ports through attracting private sector investment. Critical to this process has been a challenging attempt to reform labour systems in a context where port work has been traditionally associated with physicality, casualisation, and job loss. Indian port labour is one of the oldest and largest labour forces in the country, traditionally characterized by a high degree of skill through occupational trades.
1.3 Research objectives and methodology
– To understand the demand and supply of skilled labor in different private ports of India. The reason for choosing this is because we assume that the skill development programs, if implemented, would lead to skilled labor. Skilled labor here refers not only to technical skills but also to operation and management skills.
– To study the various skill development programs implemented in the selected ports. This is because we wish to know the extent to which the government is serious in this activity and also to know the various schemes taken up by different ports.
– To analyze the difference in the expected and actual outcome of these programs. This is because we assume that certain times goals have not been met due to various reasons. This also gives us an insight into future expectancy.
– To know the various innovations and changes the management has taken up for developing skill in their labor. This has been chosen to study as it may happen that certain changes have taken place which may not be a part of any particular program but may have brought a change in skill by large.
– See the implication of this change of skilled labor on cost, time, and quality of work. This is important to know as skill will have a direct implication on these 3 factors which are most important for any work.
– Compare the same with the situation in government ports wherein no such development programs have been taken up. This is to see the contrast as to how skill development has become a competitive advantage for private ports.
The main or broader objective of the study is to analyze the impact of skill development programs implemented by the government in private ports in India. The specific objectives are as follows:
2. Government Skill Development Programs
India’s labor force has traditionally worked in the informal sector, primarily as agricultural workers. For the 230 million Indian workers employed in agriculture, skill levels are generally low, wages are poor, and working conditions are bad. This workforce is in transition; agriculture is no longer absorbing surplus labor, and increasing numbers of agricultural workers are becoming casual laborers. Evidence suggests that a lack of education and training has been a key factor limiting access of the poor to the opportunities offered by India’s growing economy. Development of the skills of the workforce is essential for workers in the informal sector to access better employment opportunities and wages.
In recognition of the importance of skill development to achieve broader social and economic goals, the government has recently paid greater attention to policies aimed at skill development. Four major initiatives are the Skill Development Initiative Scheme (SDIS), Vocational Training Improvement Project (VTIP), the Apprentice Training Scheme (ATS) under the Ministry of Human Resource Development, and the Prime Minister’s National Council on Skill Development.
2.1 Overview of government initiatives
India has a long history of public sector-sponsored skill and vocational training programmes. Beginning in the mid-1950s, training programmes were initiated to enable and improve the skills of workers and supervisory personnel employed in different industries. The primary focus of these programmes lay in enhancing the productivity of existing workers in industry, and the employability of youth, with a view to providing a workforce of requisite quality and quantity for the industrial sector. These programmes involved a variety of vocational training schemes, which were administered either by the Central Government Directorates, the State Governments, or by public and private sector organisations. In 1976, the Vocational Training Systems Project was launched with World Bank assistance, followed by the Certificate of Competency Project in the late 1980s. Another important development was the establishment of the National Skill Development Corporation (NSDC) in 2009. This was a public-private partnership whose primary objective was to enable a large-scale creation of sustainable livelihoods in rural and urban India. Its aim was to also provide training and skill enhancement for people working in several different industry sectors. Primarily, the NSDC provides funding for various skills training organizations and companies, often including building capacity by providing project financing facilities. Finally, the most recent scheme has been the Pradhan Mantri Kaushal Vikas Yojana (PMKVY) scheme which was launched in 2015 and which involves skill training of youth to make them more employable in several different industry sectors.
2.2 Analysis of skill development programs
Inception of the skill development is to create a workplace culture in the integrated container, what to talk of term labours working in the port, and they should hold a recognized and certified degree or diploma equivalent to any level of education or the professional course which enable them to motivate in further learning. For example, designating an electrician with a certificate course in the electrician should enable him to read and write the instructions given on the electric instrument or switch. It has been observed from the various case studies of successful implementation as mentioned in section 3 that the workers remained satisfied with the upgrading of their skills. The main aim of the available skill development program is to provide a fair opportunity to learn and earn for the port workers. There have been some skill development programs structured by the government. Competitive scheme for the skill development – under this scheme, the government has announced a direct monetary incentive of Rs 10,000 per person being trained. This will enable the workers to gain and get benefit same as the amount of incentive given to any other students in education or any other professional courses. National apprenticeship act 1961- This is the act for providing training to the apprentices. The government has revised the act in 1973 adding a provision of 25% reservation in the training for the SC/ST apprentices and it shall be notified that all the employers shall have some number of training places for apprentices not less than the places for the same semi-skilled workers so that there will be no discrimination in the wages and quality of apprentices and semi-skilled workers. With the amendment in the act and the reservation of training for the backward class apprentices, it is a good provision for creating equality in the work environment in the long term and the improvement of quality of education and training for the backward class people.
2.3 Case studies of successful implementation
In Orissa, the existing workforce of 10,000 was found to have immense potential to learn new skills, thus skill training for instructors and supervisors was taken up under an innovative scheme. A month’s programme was designed and conducted for instructors and supervisors. In the first batch of 30 trainees, 27 successfully completed and moved on to the next level. Training of crane operators was also taken up under a scheme. The duration for the training was fixed after a skill gap analysis and a syllabus was developed. An empanelled private institute provided the training. So far, two batches of trainees have been trained. The first batch had a duration of 5 weeks while the second had 3 weeks. In both cases, 80% of the curriculum was practical and the trainees were put to rigorous assessment after which participation certificates were awarded. High performers were given incentives. A reinforcement training has been planned in the future. Finally, a full-fledged trade test for certification of the crane operators will be taken up.
The cost per trainee was approximately INR 59,600. Comparative job analysis will show that the crane operator has achieved new levels of skills and competencies. This will enhance productivity and enable the operator to gain better employment. As an example, a semi-skilled operator is currently earning INR 3250 with no job security. After training, he can earn around INR 7000 in the port sector. The job is transferable to the industrial sector where skilled operators can even earn around INR 15000. He also has the possibility to seek jobs abroad where pay scales are high. A certified operator, on the other hand, will earn around INR 9000 and can work up to the age of 58. Thus, career as well as wage progression is possible as operators move from semi-skilled to certified levels.
In Mumbai, undertaking the skill gap analysis and training of 4000 strong OHT operators’ workforce was a unique achievement and the training of the first batch of 200 was done on a very innovative scheme. An assessment was taken up for the selection of 30 participants. 10 were sent to Tata Institute of Social Sciences, 10 went to Kohinoor Technical Institute, and 10 were trained in-house by Mumbai Port Trust. An MOU has been signed with a Shipping and Logistics college by the name of Samudra Institute of Maritime Studies, approved by Indian Maritime University. Persons with existing qualifications or those undergoing skills training will be absorbing the trade soon. Employment in the port sector is crucial to the future generation and free, self-employment with high mobility workers can look forward to a career in the port and, most importantly, get a formal job rather than a contractual job. Freelancers, unregistered labor, and dock workers of other trades have a lower level of education as well as age group, and hence these types of workers need to be certified on informal sector skill set. This can help them to build a transition from the current trade to a future trade at one stage and also job security.
3. Impact on Indian Port Labor
The assessment of the skill level of port workers can be done by scrutinizing the qualifications and skills of recruits to port jobs and comparing them to the same for current workers. Unfortunately, due to the casualization of the workforce, there is little differentiation between recruitment of labour and recruitment of workers to long-term jobs at the port. This is particularly the case for the unskilled and semi-skilled job categories, where contracts for regular employment can often depend on the availability of work and the contract of casual workers can be terminated if work is in short supply. A positive outcome would be that recruitment for long-term jobs will increase and this will take on workers with higher qualifications and skills than the current workforce. This will improve the skill profile of the port labour. At the same time, training programs can be implemented to upskill the current workforce in an attempt to improve the productivity of existing workers. This higher skill level likely will lead to higher pay for workers. This in itself could be seen as a negative for port employers, who have a record of suppressing wages in order to keep labour costs low. This will likely cause them to oppose the skill development programs, as they would rather access higher skilled and hence higher paid workers, without having to pay for training or increased wages for current workers.
To investigate how the skill development programs have affected the Indian port labor, one can examine the skill level of the workforce through an assessment of the educational level, the skill profile, and the remuneration of port workers. The skill development programs have been particularly aimed at raising the skill level of the port workforce and the government has acknowledged the low education and skill levels of the workforce at many Indian ports. This has been seen as a major factor in the low productivity at Indian ports and a causal factor in the decline in port employment, particularly of regular workers. The vocational education and training programs that are being implemented in collaboration with the private sector are aimed at improving the skill level of workers, making them more employable in the port industry and making the industry more competitive in comparison to other modes of transport.
3.1 Assessment of skill improvement in port labor
Matching the improvement in skill level of the labor force to specific training is difficult to track in a situation where no specific skills led to no specialized training. One suggestion to improve the skill level was in training stevedores to operate cargo handling equipment. However, this has already been happening without the need for training programs, as quite often the stevedores hire equipment operators on a casual basis during times of high demand. With or without additional training, equipment operation poses a more profitable venture and thus we would expect the labor force to obtain the necessary skills to improve their career prospects through that specific activity. Unfortunately, there was no documentation of training relating to this or any other area of port labor. This hinders the ability to measure the skill improvement across the board.
3.2 Analysis of productivity and efficiency gains
Labor supply responds to skill-biased technical change, as a greater number of workers are attracted into the skilled workforce, while those unskilled workers who have been displaced will find it more difficult to compete for higher-wage skilled jobs. It will be a tumultuous period, but the long-run benefits will be a higher wage for the unskilled worker and a narrower wage differential between skilled and unskilled workers. This is due to the fact that the increase in productivity of the skilled worker will increase the marginal product of the unskilled worker, raising wages, and the decrease in supply of unskilled workers will lower the marginal product, but the increase in demand will raise wages.
Productivity refers to the efficient use of resources, labor, and capital to produce goods and services. Efficiency, on the other hand, is the achievement of the desired results in the least costly way possible. Productivity is an important indicator of economic development as it can lead to growth and higher living standards. Efficiency and productivity gains have been the hallmarks of skilled work. It is said that skill development increases the efficiency of labor through the use of better technology, machinery, and capital to produce better quality products in a shorter period of time. Studies have shown that an increase in the average educational attainment of the workforce is associated with increased capital intensity and with an increase in multifactor productivity.
3.3 Evaluation of job satisfaction and career prospects
This section has two objectives. Firstly, to assess the level of job satisfaction within skilled workers by analyzing various job aspects like safety, social aspects like teamwork, supervisors and management, pay, job task variety, and promotion prospects. Secondly, to evaluate the general opinion of whether skill development has increased future job opportunities and career prospects. Questionnaires showed that before and after skill development, job satisfaction is very high. This is because the holistic training approach taken by the IL&FS project directly corresponds to the very well-developed future career concepts of the workers, in turn motivating them towards their newly attainable career goals. 66% of workers said they have better promotion prospects, and with a qualitative assessment, it was apparent that skill development has created a new skilled job tier in this industry. This also gives the youth confidence in joining the industry, and the skilled workforce has evidenced a 20% increase in job opportunities. Stepwise skill levels were identified as: unskilled workers gaining one skill achieving 30% increased job opportunities, giving them hope in achieving the next 3 skill levels.
4. Policy Recommendations and Future Directions
Data which highlights the current level of skill among existing staff is necessary to identify initial areas for improvement, which will be taken as the difference between the targeted and current level of skilled labor translated to the number of staff. Therefore, it is recommended that all major ports conduct a census of their workforce to establish a labor profile which includes the job type and skill level. Since skill level varies between different types of jobs, this can provide an index for each job category and the targeted number of skilled labor can be divided amongst job categories. A systematic analysis of this type would identify areas where the skill level is close to the target and areas which require more attention. This would facilitate effective resource allocation, minimizing redundancy and wastage, while maximizing output.
Correlation analysis suggests that expenditure on skill advancement of labor positively impacts capacity enhancement at the 1% level of significance, validating the hypothesis of the present study. Given that skill improvement of existing staff is a cost-effective tool for expanding port capacity, labor skill improvement can be seen as an investment which sustains port sector growth. Therefore, we suggest that the Government of India requires setting a goal or target for total labor skill improvement in all major ports in India. This can be measured by variable ‘x’, which represents the target of appointing ‘y’ number of skilled labor in a certain time frame, ‘y’ being the number of labor to be skilled and ‘x’ being time in months or years.
4.1 Assessing the effectiveness of skill development programs
Skills development programs are perhaps the most overt means of exercising national policy to affect change in vocational training. These programs have been exceedingly successful in many cases and moderate success has been achieved in numerous others. It is hard to measure the incremental contribution of these programs toward national skills formation since they occur against a backdrop of other activities (such as enterprise training and educational improvements in primary and secondary schooling). However, in the Indian context, there have been a considerable number of skill development programs in both agriculture and industry. Many of these programs have been micro-level projects targeting a small group of workers, and as such are hard to evaluate in terms of their macro-level impact on the national skill levels of the workforce. However, there have been several important initiatives which have great potential to influence the skill base of the workforce in a particular sector, such as the National Vocational Training System and the more recent Vocational Training Improvement Project.
4.2 Identifying areas for improvement
Various areas for improvement have been identified in the skill development programs implemented by the government for the labor working in the Indian ports. There are four training programs being conducted in India for the labor employed in the major ports. Workers interviewed in these areas reported never receiving any training. This may suggest that those workers supposed to be on the possible training enhance part taking for other workers. It may also indicate a lack of visibility of the training program or poor communication to workers. This shows the need for creating awareness about the training programs amongst the workforce. Considering the respondents’ educational level, the fact that most workers are literate suggests that the target group selection has been appropriate. However, the workers trained were interviewed in two port areas and may not be an adequate representation of workers from the overall port sector in each area. This is because training is given for a handful of workers when many others may also be in need of the same. The standard of teaching material emerged as an important issue as in many cases training programs were conducted using regular job-specific terminologies and were tough to understand. It is often assumed that because workers understand the spoken word they can understand technical jargon and teaching material used at training. This can lead to a decrease in the effectiveness of the training programs. The programs conducted were varied in nature with the TCFC program being an informal training activity and training at other areas being a series of lectures. This suggests there is a requirement to standardize the training activity across different areas to a consistent and effective teaching method. This will also require involvement and guidance from the port’s management. The time period for the training programs was also variable with various workers reporting training periods from two days to two months. This also includes the “on the job” training activity such as at the VCT training program. While this does not pose immediate problems, it will be necessary to consider a suitable time period that is also cost-effective for workers. This is because longer training periods may take workers away from their regular employment for large periods of time. This can act as a disincentive towards training as the loss of income during training is an opportunity cost for employment. This, therefore, indicates a necessity for implementing skill development programs with proper scheduling and suitable timing for the workforce.
4.3 Implications for future policy formulation
In light of the significant growth trends in Indian maritime trade, this paper has aimed to critically review the impact of government skill development programs on port labor. Through the preceding analysis, most programs have been critiqued for being supplementary measures with primary shipping/stevedoring companies being the focus of development. It has been argued that such initiatives have imposed and, but have failed to deliver any significant increase in skill levels to labor in the long term, with training outcomes being unclear. The only exception has been the implementation of apprenticeships and traineeships which have shown to impart high level skills to workers who undertake these programs. It was evident that workers who participated in these programs developed transferable skills and were able to seek employment outside of the port and in other areas of the supply chain. This has contributed to worker mobility and has had positive impacts for developing a more highly skilled and flexible workforce. Therefore, it is recommended that apprenticeships and traineeships should become the primary focus for all future skill development initiatives for port labor. In particularly, these programs should be sponsored for private stevedoring companies to enhance their training practices and to enable them to take on more trainees.