Chief Economic Adviser V Anantha Nageswaran has done a great service by saying something many parents, students and policymakers do not want to hear: that the old automatic premium attached to software degrees and MBAs is vanishing. The globalisation-era formula was simple. Get an engineering degree, learn coding, do an MBA if possible, and enter a white-collar growth track. That formula is no longer reliable. AI is changing the economics of routine cognitive work. One experienced employee, assisted by AI tools, can now do work that required dozens of freshers in the past. The first impact may not be mass layoffs. It may be the silent closing of entry gates. Witness the recent drop in hiring by IT companies.
But his warning should not be read as an obituary for engineering or management education. India does not need fewer engineers. It needs different engineers. Civil engineering, for instance, will remain central to India’s future. A country that is still building roads, bridges, ports, railways, water systems, housing, logistics parks and climate-resilient cities cannot say engineering is finished. If anything, demand for good engineers will rise.
The real question is: what kind of engineering? A civil engineer of tomorrow cannot merely learn old formulae for concrete and surveying. She must understand climate risk, water stress, urban flooding, green materials, GIS mapping, project finance, procurement and lifecycle maintenance. Mechanical and electrical engineers must understand robotics, precision manufacturing, storage, grids and renewable integration. Computer engineers must move beyond routine coding to systems thinking, data architecture, cybersecurity and AI applications in real sectors.
The same applies to MBAs. India does not need fewer people with analytical and managerial skills. It needs many more, but in places where they are rarely found today. Every district needs people who can analyse data, prepare investment plans, evaluate projects, monitor outcomes, improve procurement, manage public assets and coordinate across departments. If India is serious about bottom-up planning, the district cannot remain merely an administrative unit. It must become a planning, data and execution unit.
Why not strengthen district planning offices with young professionals trained in economics, management, public finance, statistics, GIS, infrastructure planning and social sector delivery? Instead of producing generic MBAs who chase the same corporate jobs, we could create district development analysts, municipal finance associates, procurement specialists, health systems managers, education data officers and climate adaptation officers. Such teams could transform local governance and create meaningful public-purpose jobs.
This is where curriculum reform and job design must go together. It is not enough to tell colleges to update syllabi. The labour market must create roles that rewards updated skills. If colleges teach climate-resilient construction but public works departments recruit on old criteria, nothing will change. If MBA students learn data analytics but district administrations have no posts for outcome monitoring or GIS mapping, the skill will be wasted. Education reform without job reform becomes another certificate factory.
The CEA is also right to ask India to take skilled trades seriously. Welding, plumbing, carpentry, electrical work, caregiving, nursing, hospitality and culinary skills involve human presence, judgement, dexterity and trust. These are not easily replaced by AI. But here too we need to be careful. You cannot change social attitudes just by exhortation. A middle-class parent who has spent two decades telling a child to become an engineer or MBA will not suddenly celebrate welding as an equally attractive option. In India, a degree is not merely a credential. It is prestige, marriage value, caste mobility, migration possibility and insurance against manual precarity.
This is why comparisons with Germany, Switzerland, Japan or South Korea must be made carefully. Skilled trades are respected there because institutions made them respectable. Europe has had guilds, chambers, apprenticeships, licensing norms and wage-bargaining institutions for more than a century.
India has no comparable ecosystem. We have excellent individual craftsmen, but no strong professional guilds for plumbers, electricians, welders, carpenters or repair technicians. We have ITIs and skilling schemes, but weak social prestige. We have certificates, but often not employer trust. Most importantly, India’s labour force is still overwhelmingly informal or unregistered. In such a market, a trade skill does not automatically translate into dignity or income security. It can just as easily mean casual work, no written contract, no insurance, no pension, unsafe conditions and arbitrary wages. By contrast German law requires compulsory labour representation on company boards.
The recent unrest by industrial workers in the Noida and Gurugram-Manesar belt is a reminder. Many workers in automotive, garments and allied manufacturing reportedly protested for basic monthly wages of around Rs 20,000 or more. These were not software engineers complaining about appraisal cycles. These were factory workers saying wages were below survival level.
The deeper problem is India’s graduate unemployment crisis. Millions of young graduates are not working, earning or acquiring experience, but preparing for competitive exams. The government job has become a lottery ticket; the coaching class has become a waiting room. This is not irrational behaviour. It is a rational response to a labour market where private entry-level jobs are poorly paid and insecure, while government jobs offer a decent salary, status, security and social insurance.
The same logic applies to universities. They have been declared dead attributed to the internet, MOOCs, boot camps, the pandemic and now AI tutors. Yet higher education has expanded massively. The real issue is whether universities will use AI as a partner in learning, and not merely treat it as a cheating device.
Trade skills need to be formalised and bestowed with social dignity. India’s jobs crisis will not be solved by replacing one social obsession with another. It will be solved when a young Indian can become a civil engineer, coder, nurse, chef, welder, district planner, technician, teacher, entrepreneur or civil servant — and each path carries dignity, income, security and mobility.
The Billion Press
(Dr Ajit Ranade is a noted
economist.)
