You open the newspaper, social media platform, digital news site, whatever it is, and among all the hellfire and discontent happening on the global level, you see the news about the growing unemployment rate, especially for Indian graduates.
One would think, after all the hard work of endless tuition classes, coaching, Board exams, trying to get into a prestigious college/university, studying, studying, and more studying, that a job would be the least a student could look forward to.
That parents of these children could then rest easy, knowing that all that work, endless nights, and, most of all, the money that has gone into their child’s education will ensure a well-paying job for their child.
However, the opposite seems to be the case. As the world advances and courses and studies become more intensive and competitive, it seems that the number of jobs has not risen at the same rate.
Instead, unemployment in the country has been rising each year. This is despite new sectors emerging and new areas of employment being touted by the government and the corporate sector.
A recent study by Azim Premji University found that more than 40% of college graduates under 25 were unemployed. Youth aged 15 to 29 account for 82.9% of India’s unemployed. The share of educated youth among the unemployed has nearly doubled, from 35.2% in 2000 to 65.7% in 2022.
So the question now arises, why exactly are Indians investing so much money, going into the crores, for these college degrees when there is such a lack of employment at the end of it?
What Indian Families Are Actually Spending
A 2024 report by the International Labour Organisation (ILO) and the Institute of Human Development (IHD) found that India’s graduate unemployment rate stands at 29.1%, nearly nine times higher than the 3.4% unemployment rate among people who cannot read or write.
And yet, Indian families are spending more on degrees than ever before.
According to a 2024 report by CRISIL, education loan assets under management were expected to cross Rs. 60,000 crore in FY2025, a 40% jump in a single year.
According to the Ministry of Statistics and Programme Implementation (MoSPI) data, household spending on education has multiplied 4.6 times since FY2012, from Rs. 1.8 lakh crore to Rs. 8.43 lakh crore in FY2024.
According to 1Finance Research, the highest average tuition cost for a KG-to-Class-12 education in an elite school is ₹76.2 lakh, and the total cost of such a school education, including books, uniforms, extracurricular activities, and boarding, can reach ₹1.68 crore.
School fee inflation is running at 7% to 15% per year in major cities, far above the general consumer price index, according to financial planning estimates from HDFC Life and ICICI Prudential.
The parental response, increasingly, is to invest even more: in tuitions, in coaching, in the parallel education economy that shadows the formal school system.
Coaching: The ₹58,000 Crore Parallel System
India’s coaching industry, the sprawling network of tuition centres, test-prep academies, and private tutors that supplements (and in many families, effectively replaces) formal schooling, is now worth Rs. 58,088 crore and is projected to reach Rs. 1,33,995 crore by 2028, according to Infinium Global Research.
IMARC Group puts the coaching institutes market at USD 6.50 billion in 2024, projected to reach USD 17.40 billion by 2033 at a CAGR of 10.4%.
According to data from the National Sample Survey, as many as 7.1 crore students are enrolled in private tuitions across India.
Higher Education: From IIMs to International Degrees
The cost divergence between public and private higher education in India is among the most dramatic anywhere in the world.
An MBBS degree at a government medical college costs approximately Rs. 1.9 lakh for the entire five-year programme. The same degree at a private medical college can cost Rs. 82 lakh, roughly 42 times more.
An IIM MBA, which sits at the apex of management education in India, costs between Rs. 5 lakh and Rs. 25 lakh, depending on the IIM, with the older, more prestigious IIMs (Ahmedabad, Bangalore, Calcutta) at the higher end.
A B.Tech at an IIT costs approximately Rs. 2 lakh to Rs. 10 lakh for the full degree, but the total investment families make in securing that seat, including two to four years of coaching, can easily double that figure.
More than 1.8 million Indian students are now studying abroad, collectively spending an estimated USD 70–85 billion annually on overseas education, per the Indian Student Mobility Report and data from the Ministry of External Affairs.
As of December 2023, overseas education loans already made up 57% of all education loans taken by Indian families, according to a CRISIL industry report.
The value of education loans disbursed for overseas studies alone jumped over 50%, from Rs. 15,445 crore in FY2021-22 to Rs. 23,576 crore in FY2023-24.
Read More: With US, UK On The Out, These Are The New Education Hubs For Indian Students
What Is Happening Now?
There was a time when coaching used to be reserved for Class 11 and 12 students preparing for engineering or medical entrance exams.
Today, as child psychologist Dr. Nimesh Desai has noted, it begins at age five and continues for two decades.
Desai was quoted in The Print, saying, “There was a time when tuition classes were temporary solutions. In 2022, they became a lifestyle. It starts from the age of five and goes on for the next two decades.”
Foundation-level coaching, courses for students in Classes 6 to 10 that “prepare them to prepare” for competitive exams, is now a standard offering at institutes like Allen, FIITJEE, and Aakash. Coding classes for eight-year-olds are commercially mainstream.
Furthermore, it is no longer the expected courses, like engineering and medicine, that students are taking coaching classes for.
The reality has shown that coaching centres for CLAT (the Common Law Admission Test) have increased rapidly.
There are now even coaching centres dedicated entirely to preparing students for the CUET exam that governs admissions to Delhi University, a university whose undergraduate admissions, within living memory, simply required good Class 12 board marks.
What Do Experts Have To Say On This?
Amit Basole, Professor of Economics, Azim Premji University, speaking on this imbalance between educated graduates and the lack of jobs, in an April 2024 report, told The Wall Street Journal, “What we have on the supply side of the labour market is a lot of young men and women with a lot of degrees. But it isn’t clear what they have been trained to do.”
And yet, Indians spend all this money on degrees and coaching.
This is because while a graduate is unemployed at a higher rate, a non-graduate faces a different kind of economic marginalisation, a strong exclusion from the formal sector, from government jobs, and more.
The ILO report also shares that higher unemployment among graduates “reflects both a lack of quality employment opportunities, and the relative ability of better-educated young people to hold out for better opportunities.”
In other words, graduates are unemployed partly because they are choosing not to take low-paying, insecure jobs that their education has made them eligible to refuse.
Degrees, even in a credential-saturated market, remain the minimum ticket to participation in the formal economy.
However, there is also a rising dissonance observed by experts about the need for degrees in the first place and the changing nature of the professional workspace.
Bhavya Misra, CHRO at Godrej Capital, told LinkedIn that “Degrees are valuable, but they are no longer the final word in a market where technology and skills are evolving so quickly. Continuous learning and the ability to adapt give professionals a real edge.”
Yeshwinder Patial, director for human resources at MG Motor India, speaking with The Economic Times in 2023, also said, “There is a gap between what the industries are looking at and the course curriculum they have gone through.”
This was echoed by Mohandas Pai, the former chief financial officer of Infosys Ltd., saying, “The experience of everybody in the IT industry is that the graduates need training.”
Pankaj Tiwari, a 28-year-old who reportedly spent Rs. 1,00,000 for a master’s degree in digital communication, coming from a family whose annual income is around Rs. 4,00,000, was left unemployed despite the college promising campus placements that didn’t happen.
Tiwari said, “If I had received some training and skills in college, my situation would have been different. Now, I feel like I wasted my time.”
“I just secured certificates on paper, but those are of no use.”
Image Credits: Google Images
Sources: The Indian Express, ILO, CRISIL Ratings
Find the blogger: @chirali_08
This post is tagged under: Graduates, indian Graduates, Graduates employment, indian Graduates employment, career struggles, careers, employment crisis, fresh graduates, Future Of Work, global unemployment, graduate struggles, India Jobs, job crisis, job hunt, job market, job search, job trends, Work-Life, young professionals, youth unemployment
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