The NITI Aayog has released a report titled “Reimagining Skilling for Viksit Bharat@2047” that puts a sharp focus on the country’s biggest human capital challenge. It finds that about 8.7 crore young Indians in the 15 to 29 age group are classified as NEET youth, meaning they are not in education, employment, or training. The report also exposes a serious employability gap, stating that only 8.25% of graduates work in jobs that match their qualifications.
What Is the NEET Category and How Big Is the Problem?
NEET stands for Not in Education, Employment or Training. The term is used globally to describe young people who are disconnected from both the education system and the labour market. In India, the NITI Aayog report, based on data from the 78th round of the National Sample Survey (NSS) conducted in 2021, estimates that roughly 8.7 crore individuals in the 15 to 29 age bracket fall into this category. This represents about 11% of the population outside the labour force.
The government has clarified that the NEET figure should not be confused with the unemployment rate. The unemployed are those actively seeking work and are counted as part of the labour force. The NEET category, by contrast, includes people who are not seeking employment either. According to the report, nearly 88% of those in the NEET group are engaged in domestic duties, with women accounting for the largest share.
The 8.7 crore estimate comes with an important caveat. The data was collected during FY2020-21, a period when the COVID-19 pandemic severely disrupted education and employment. The government has pointed to more recent Periodic Labour Force Survey (PLFS) 2025 data, which shows that the NEET percentage for the 15 to 29 age group has since dropped to 25% under the usual-status measure. For the 15 to 24 age group, the figure is 21%.
India’s total population of about 145 crore is divided into a labour force of 65.4 crore (45.1%) and 79.6 crore (54.9%) outside the labour force. Among those outside the labour force, roughly 29.1 crore are students, 11.3 crore are children below five years, 15.7 crore are aged 59 and above, 14.7 crore fall in other categories, and 8.7 crore are NEET youth.
The Employability Gap: Why Degrees Are Not Translating into Jobs
The report draws attention to a stark disconnect between education and the labour market. Citing the Economic Survey 2024-25, it notes that only 8.25% of graduates in India are employed in roles that align with their qualifications. In other words, over 90% of graduates work in jobs that do not match their educational background.
This mismatch is reflected in unemployment data as well. Unemployment among graduates stands at 13%, while among graduate women it rises to 20.4%. Both figures are far above the national unemployment rate of 3.2%.
The report attributes this gap partly to the heavy tilt towards generic degree programmes such as BA, BSc, and BCom, which have weak direct links to jobs. Of the 3.4 crore students enrolled in undergraduate programmes, about 1.13 crore are enrolled in BA alone, while combined enrolment in BA, BSc, and BCom exceeds 2 crore.
Another finding is that 80% of higher-education students identify lack of practical experience and industry exposure as a major gap in their learning. Limited access to practical training and industry-aligned coursework continues to hold back employability, even among formally educated youth.
What Is NITI Aayog and Why Its Skilling Report Matters
The NITI Aayog, which stands for the National Institution for Transforming India, is the apex policy think tank of the Government of India. It was established on 1 January 2015 through a resolution of the Union Cabinet, replacing the Planning Commission. The Prime Minister of India serves as its Chairperson, and the Governing Council includes the Chief Ministers of all states and Lieutenant Governors of Union Territories.
NITI Aayog designs long-term policy frameworks, fosters cooperative federalism between the Centre and states, and monitors the implementation of programmes. The Skill Development, Labour and Employment Division of NITI Aayog prepared the new report, which was released in August 2026.
The report is significant because India’s workforce is expected to supply nearly one-fifth of the global labour supply over the next two decades. With a median age of about 28 years, India has one of the world’s youngest populations. The vision of Viksit Bharat 2047 depends on whether this demographic advantage translates into productive employment.
Five Segments of India’s Workforce Landscape
To understand where the barriers lie, the report organises India’s workforce and learners into five segments, which together cover around 60 crore citizens:
| Segment | Who It Covers |
|---|---|
| Schooling | Students from Grade 6 onwards |
| Tertiary education | Students pursuing degrees or diplomas, and those in ITIs |
| Formal and informal work | People in jobs with and without social security benefits |
| NEET youth | Those aged 15-29 outside education, employment and training |
| Women | A cross-cutting segment across all groups |
The report deliberately excluded agriculture from the study, stating that the sector has distinct labour market characteristics that need a separate analytical framework.
What Is Blocking Skilling Outcomes
The report identifies five recurring barriers that stop skilling from turning into jobs. The first is lack of trusted information. Learners do not have reliable guidance on which courses are credible, what returns they offer, and how government schemes and apprenticeships work. The State of Skills Survey 2024 found that lack of awareness of suitable programmes was cited by 43% of NEET youth, 47% of women, 36% of higher-education students, 52% of formal workers, and 55% of informal workers.
The second barrier is limited access. Vocational education and ITIs are often seen as second-tier options, and online courses are viewed with distrust. Fewer than one in 12 secondary schools in India currently offer vocational subjects. The third barrier is money. For NEET youth, the absence of any income combines with the sunk cost of earlier education, making paid skilling hard to afford.
The fourth barrier is the quality of learning. Many programmes are overly theoretical and weakly connected to workplace needs. The fifth barrier is structure and governance. Programmes often measure success by enrolment and completion rather than by placements, wage gains, or career progression. Around ₹34,000 crore was allocated for skilling across central ministries in FY2025-26, and over 7.67 crore people have been trained since 2014-15, yet outcomes remain uneven.
Five Core Reforms Proposed in the Report
To fix these problems, NITI Aayog has proposed five core reforms aimed at redesigning how India learns, earns, and progresses. These are supported by four system enablers.
Skill Integration in Schools
The report recommends introducing General Employability and Entrepreneurship Skills (GEES) universally from Grade 6 to Grade 12. It also proposes Kaushal Tracks, or structured vocational pathways, from Grade 9 onwards, allowing students to specialise in areas aligned with local and national skill demand. This is in line with the National Education Policy (NEP) 2020, which already guides the integration of vocational education from Grade 6, though implementation has been slow.
Industry-Linked Higher Education
The second reform seeks to make higher education more job-focused. The report calls for public-private partnership (PPP) models and Apprenticeship Embedded Degree and Diploma Programmes (AEDP) so that curricula stay current and students gain work-linked learning. It also recommends flexible, modular, and earn-while-you-learn formats, so students can combine study with income.
Outcome-Linked Skilling Programmes
The third reform shifts standalone skilling programmes from enrolment-driven delivery to outcome-linked, industry-backed models. Programmes should focus on high-growth sectors such as green industries and electric vehicles (EVs), while helping workers reskill from declining occupations. Financing should be linked to verified outcomes such as placements, wage gains, and retention, rather than to enrolment numbers.
Apprenticeship for All
The fourth reform repositions apprenticeships as a mainstream and trusted pathway between learning and work. The report proposes a unified State Apprenticeship Platform that brings together schemes like the National Apprenticeship Promotion Scheme (NAPS) and the National Apprenticeship Training Scheme (NATS) through a single window. It also suggests financial incentives for MSMEs to take on apprentices.
Guidance and Perception Building
The fifth reform makes career guidance a continuous part of the system. It proposes pathway clinics in schools and colleges, community counselling hubs, and digital tools to help learners decide what to study and where. It also recommends a skills-first hiring model, where candidates are assessed on skills, ITI or apprenticeship credentials, and work experience rather than degrees alone.
How the Reforms Will Be Implemented
The report proposes four system enablers to make the reforms work. A Digital Skills Passport would give every learner and worker a record of verified credentials and work experience. Outcome-based financing would use tools like skill vouchers, placement-linked loans, and Skill Impact Bonds. The National Credit Framework (NCrF) would allow learners to move between education, skilling, and work without restarting their journey. Finally, skills-first policies and shared infrastructure would reduce duplication by enabling shared use of existing laboratories, workshops, and training centres.
The government has already begun acting on the report. The Integrated Scheme in Skilling Architecture (ISSA) was announced in the Union Budget 2026-27, with ₹600 crore allocated to the Ministry of Skill Development and Entrepreneurship (MSDE). The scheme will run State Skills Transformation Pilots in Andhra Pradesh, Odisha, Uttar Pradesh, Bihar, and Assam.
Key Takeaways
- The NITI Aayog report titled “Reimagining Skilling for Viksit Bharat@2047” estimates that 8.7 crore Indian youth aged 15 to 29 are classified as NEET (Not in Education, Employment or Training).
- Only 8.25% of graduates are employed in roles aligned with their qualifications, while 13% of all graduates and 20.4% of graduate women are unemployed.
- The NEET estimate is based on the 78th round of the National Sample Survey (NSS) conducted in 2021, with nearly 88% of NEET youth engaged in domestic duties.
- NITI Aayog was established on 1 January 2015, replacing the Planning Commission, and serves as India’s apex policy think tank.
- The report proposes five core reforms including GEES from Grade 6 to 12, Kaushal Tracks from Grade 9, and Apprenticeship Embedded Degree Programmes (AEDP).
- The Integrated Scheme in Skilling Architecture (ISSA) with ₹600 crore allocation was announced in the Union Budget 2026-27 to implement the recommendations.
