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Tuesday, 10 April 2012 02:05
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Government-run employment exchanges just don’t work
Several years ago, the Delhi-based Centre for Civil Society found the Delhi government had spent R20.6 crore to get 902 people jobs out of the 539,734 registered at 20 employment exchanges across the city. At R228,381 per job, the cost of providing the job was probably several times higher than the annual salary earned by those who got jobs—as against this, most private-sector job providers manage to make profits on a commission that equals 15-30 days’ salary of those they help place. Things may have got better for some exchanges since, but for the majority of employment exchanges, the number of jobs provided have fallen—we’re not even talking of the cost of running the exchanges!—from 509,600 in 2010 to 469,900 in 2011. Not surprising then, that the labour ministry should be moving a cabinet proposal to get funds to modernise India’s 966 employment exchanges, to get private players to help train and assess job-seekers. Indeed, the finance minister had announced PPP employment exchanges in his budget three years ago.
Apart from being three years late already, the problem with this proposal that’s being packaged as a PPP one, however, is that there’s nothing PPP about it—the exchanges are to be run by the government, with the private-sector involved in training, whereas the real private-sector skill comes in finding jobs, in liasing with industry to convert the exchanges into career centres. Getting the private-sector in as a contractor is unlikely to do this. A good model to follow is that of Karnataka, where some employment exchanges have been handed over to Teamlease—while Teamlease has put in the necessary funds to modernise the exchange, the government gives it R1,500 for every person who gets a job and remains employed for at least 6 months. In this model, getting the private-sector to run the government exchange lowers capital costs dramatically and, given that the exchange is a government one, also increases its acceptability. Right now, the government’s plan to fix the employment exchanges is akin to getting new hardware while what is really required is new software—getting private teachers in government schools, in a similar vein, isn’t going to help fix quality; what’s required is to let the private-sector run the government schools fully. A public sector naukri.com just doesn’t have the same heft as a private-sector one does.

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