National Institute of Construction Management and Research (NICMAR), Pune conducted its first ever E-Summit as part of its annual techno-cultural fest Technikala. The event conducted in association with NICMAR Startup Club saw huge participation from students and by eminent personalities from the construction industry with a taste for entrepreneurship.
Theme: Capitalizing on demographic dividends: Entrepreneurship and the way forward.
According to United Nations Population Fund (UNFPA), demographic dividend means, “the economic growth potential that can result from shifts in a population’s age structure, mainly when the share of the working-age population (15 to 64) is larger than the non-working-age share of the population (14 and younger, and 65 and older)“.
Economically, demographic dividend refers to the growth in an economy that results from a change in the age structure of a country’s population.
To receive a demographic dividend, a country must go through a demographic transition where it switches from a largely rural agrarian economy with high fertility and mortality rates to an urban industrial society characterized by low fertility and mortality rates.
There are four main areas where a country can find demographic dividends:
- Savings—during the demographic period, personal savings grow and can stimulate the economy.
- Labour supply—it adds more workers to the labour force, including more women.
- Human capital—with fewer births, parents can allocate more resources per child, leading to better educational and health outcomes.
- Economic growth—it increases GDP per capita because of a decrease in the dependency ratio.
India has one of the youngest populations in an aging world. In 2020, the median age in India will be just 28. Compared to 37 in China and the US, 45 in Western Europe, and 49 in Japan.
Since 2018, India’s working-age population (people between 15 and 64 years of age) has grown larger than the dependant population — children aged 14 or below and people above 65 years of age. This bulge in the working-age population will last until 2055 or 37 years from its beginning.
Demographic dividend has historically contributed up to 15% of the overall growth in advanced economies. Many Asian economies such as Japan, China, and South Korea were able to use this ‘demographic dividend’ positively.
China is a well-known example in this regard. In the 16 years between 1978 and 1994 (post-reform, pre-dividend) China saw eight years of double-digit growth. In the 18 years since 1994, there have been only two years when China could not cross the 8% growth mark.
According to Economic Survey 2018-19, India’s Demographic Dividend will peak around 2041, when the share of working-age, i.e. 20-59 years, population will hit 59%
India has 62.5% of its population in the age group of 15-59 years which is ever increasing. The figure will be at the peak around 2036 when it will reach approximately 65%.
- Jobless growth– There is mounting concern that future growth could be jobless because of de-industrialization, de-globalization, the fourth industrial revolution and technological progress.
As per the NSSO Periodic Labour Force Survey 2017-18, India’s labour force participation rate for the age-group 15-59 years is around 53%, i.e. around half of the working age population is jobless.
Every year, 12 million people are ready for the workforce in India. Out of this 12 million, India produces 1.2 million engineers every year, and most of these engineers go to work for IT multi-national corporate (MNC) giants or other service sectors of India which doesn’t need the engineering degree in the first place.
Moving forward Entrepreneurship will be the answer: One cannot expect governments to create jobs for such a huge population. As torch bearers of future and young India, we must take up entrepreneurship and be job creators ourselves rather than being job seekers.
Highlighted below are some of the key takeaways from the sessions by our guest speakers.
Skill vs Knowledge
A person’s competence may be defined with 2 words, his skills and knowledge. Knowledge refers to the information, concepts, theories, etc learned over time and Skill refers to how one puts the knowledge into practice.
While knowledge is definitely important, it will be how you execute them that will be on demand in the coming years.
This one goes in line with the above takeaway, dots itself aren’t important anymore, it’s how you connect them to find meaningful output that matters. However, the issue as Steve Jobs once said is “You can’t connect the dots looking forward; you can only connect them looking backwards.”
Never say no
Mr Chetan Tolia explained how never saying “No” got him to where he is now. While making the statement, he specifically mentions why one should never say no at-least in the initial years of one’s career to any opportunity coming his way.
Get the foundation Right
People nowadays look for shortcuts everywhere. They set goals unrealistically be it career, financial goals, etc. This in turn will be met with negative results. Take the time to set your foundations right, and result will follow.
Going forward, resources such as capital, ideas, and talents would be in plenty but what is lacking is experience. Efficient utilization is difficult in its current form. Jobs must be redesigned to incorporate the experience of seniors along with the enthusiasm and experimentation by youngsters.
Sectors to watch out
Mr Vinit Dungarwal, a NICMAR alumnus during his address, shared some light on the sectors to watch out for in the coming years.
The total contribution by travel and tourism sector to India’s GDP is expected to increase from Rs 15,24,000 crore (US$234.03 billion) in 2017 to Rs 32,05,000 crore (US$492.21 billion) in 2028. That’s a growth rate of 6.7% and accounting nearly 9.2% of the total economy by the time.
It should also be seen that travel and tourism sector is a great creator of jobs across multiple segments. With approximately 4.2 crore jobs created as of 2019, the sector accounts for about 8.1% of total employment.
Real estate as a sector to watch out for may come as a surprise given the current slowdown and the problems the sector is facing. However, the future seems bright with the new optimism seen in areas like co-working, co-living, student housing, senior living, etc.
Other sectors to watch out for in the coming decade include:
Mr Manan Mehta shared some light into Why Investing early matters, which a previous article already covered. You can read that here. He also discussed about the opportunities of being a RealPreneur – A Real Estate Entrepreneur.
The summit, a long-standing dream of NICMAR Startup Club, is finally a reality. I too am personally happy to have played a small role in the event’s success. Hope the E-Summit and the Startup Club at NICMAR scales new heights in the years to come and serve as a platform for many startups in the construction sector.
[…] In the coming years, India will have the youngest working population in the world. This huge number of working population willing to spend is a boon for the credit card sector. You can read more about demographic dividends here. […]