NITI Aayog flags job disconnect in higher education, calls for 'structural overhaul'

India's higher education system faces a structural mismatch between degrees pursued by millions of students and the skills demanded by employers, NITI Aayog has warned, calling for a shift towards specialised courses, apprenticeships and stronger industry participation.

In its report Reimagining Skilling for Viksit Bharat@2047, released last week, the government think tank said generic undergraduate programmes continue to dominate enrolment even as employment outcomes remain weak. It called for structural changes across degree colleges, Industrial Training Institutes (ITIs) and polytechnics. Of about 3.4 crore students enrolled in undergraduate programmes, around 1.13 crore are pursuing BA courses alone. Combined enrolment in BA, BSc and BCom programmes exceeds 2 crore, according to the report.

Degrees, jobs remain disconnected

NITI Aayog said many students pursue conventional degrees partly to retain eligibility for government employment. The scale of competition is stark: around 1.86 crore applications were submitted for just 55,000 government posts between November 2024 and July 2025. Citing the Economic Survey 2024-25, the report said only 8.25 per cent of graduates were employed in roles aligned with their qualifications. It also noted that 13 per cent of graduates and 20.4 per cent of women graduates were unemployed, compared with a national unemployment rate of 3.2 per cent.

The challenge, according to the think tank, is therefore not simply expanding access to higher education but ensuring that qualifications translate into useful skills and employment opportunities. NITI Aayog said India's tertiary education system requires “structural reorientation” to bring learning closer to labour-market demand, noting that some curricula remain outdated while generic degrees continue to account for a large share of enrolment.

Push for job-linked degrees

Among the proposed changes is a move from broad degree pathways towards applied specialisations within popular programmes.

The report suggested courses such as BA Hospitality, BCom Analytics and BSc Applied Technology as examples of how conventional degrees could be redesigned around specific industry requirements. It also called for a significant expansion of Apprenticeship Embedded Degree Programmes and other work-integrated courses so that students graduate with practical workplace experience rather than academic credentials alone.

While apprenticeship-embedded frameworks have been introduced, their adoption remains small relative to the size of India's higher education system, limiting the number of students able to acquire demonstrable work experience before graduation. NITI Aayog also advocated flexible learning models, including modular and part-time courses, hybrid programmes and “earn-while-you-learn” arrangements that allow students to combine education with employment.

Industry role sought

A central element of the proposed overhaul is deeper participation by industry and greater use of public-private partnership models in higher and technical education. Private-sector participation could help institutions modernise curricula, introduce job-linked training and ensure courses evolve alongside changing industry requirements, the report said.

The broader objective is to move India's skilling architecture away from measuring success primarily through enrolments and certificates towards employment, earnings and career progression. The recommendations come despite signs of improvement in graduate employability. A separate NITI Aayog working paper released earlier this year estimated overall employability among post-school degree holders at 56.4 per cent in 2026, up from 47.3 per cent in 2019. Employability was estimated at 55.6 per cent for BA graduates, 62.8 per cent for BCom graduates and 61 per cent for BSc graduates.

The latest report, however, argues that India's demographic advantage will translate into economic gains only if education and skilling systems become more closely connected with actual employment opportunities.