National employability report_engineers_2011

National Employability Report
Engineering Graduates
Annual Report 2011

Table of Contents
Introduction

5

Executive Summary

7

Methodology

9

I. Employability by Sectors

10

II. Employability by Gender

13

(a) Gender Ratio in Higher Education

13

(b) Employability by Gender

15

III. Employability by Region

17

(a) Employability by Tier of Cities

17

(b) Employability across States

19

(c) Employability in Metros vs. Non-Metros

22

(d) Employability in Key Cities

23

IV. Employability Variance in Campuses

25

(a) Employability in top-tier Campuses vs. the rest

25

(b) Employability in Govt. and Private Colleges

26

(c) Employability Variance across Colleges

27

Appendix

30

Introduction

The importance of higher education in relation to the progress of the
individual and the nation cannot be overstated. In today's world, the
intellectual capital of a nation is its biggest strength in driving socioeconomic growth. For an individual, higher education is not only a means
of intellectual pursuit, but also a catalyst to become self-dependent
financially to lead a respectable life. We as a Nation have been the
beneficiaries of the new knowledge based world economy and so has
been the consistently growing Indian middle class. To continue on this
growth path and allow its advantages to trickle down to the masses, we
need to continue to audit the quality of our higher education system,
identify gaps and implement constructive interventions for a better
tomorrow.
In 2009, Aspiring Minds released the first National Employability Report
for technical graduates. The report, for the first time, defined employability
for different corporate sectors and profiles, and analyzed the percentage
of technical graduates employable in each sector. The reported low
employability served as an eye-opener, suggesting a pressing need for
education and policy reforms. It also detailed how a major proportion (7080%) of employable engineering graduates is outside the top 100
engineering colleges. Given that most corporations hire only from the toptier campuses, this creates an artificial fall in the supply of employable
engineering graduates and deprives many talented individuals from even
getting an opportunity to a hiring process. Covered widely by national and
international media, the report successfully identified key problems affecting
the education-employment ecosystem in India, and led to a constructive
debate.
The present edition is an expanded and more detailed report based on
most recent data – more than 55,000 engineers who graduated in 2011.
It goes deeper to identify patterns in employability across different regions
and kinds of colleges, analyzing in detail the distribution of employability.
Herein, it studies how employability varies across different groups:
l

How many employable females vs. males graduate every year?

l

Which regions exhibit high employability, and why?

l

How different is employability in private and government colleges?

l

Are most colleges producing the same percentage of employable
candidates, or is there a wide variation?

Aspiring Minds’ National Employability Report – Engineering Graduates, 2011 l 5

Such results are indispensible to enable targeted intervention in different
groups and kinds of colleges. At the same time, it is a first step toward
hypothesizing the causes for low employability.
Such an analysis allows one to measure some key drivers of economic
and intellectual growth. This measurement provides a tracking mechanism
to see how India is progressing year on year toward building a powerful,
enlightened and equitable nation. Aspiring Minds is committed to actively
provide feedback about employability and higher education to all
stakeholders through a yearly report card.
With commitment to the development and progress of higher education
in India!

Varun Aggarwal
Co-founder and Director
Aspiring Minds

6 l Aspiring Minds’ National Employability Report – Engineering Graduates, 2011

Executive Summary

The key findings of the present study are as follows:
The percentage of ready-to-deploy engineers for IT jobs is dismally low
at 2.68%.
Even though India produces more than five lakh engineers annually, only
17.45% of them are employable for the IT services sector, while a dismal
3.51% are appropriately trained to be directly deployed on projects.
Further, only 2.68% are employable in IT product companies, which
require greater understanding of computer science and algorithms. An
economy with a large percent of unemployable qualified candidates is
not only inefficient, but socially dangerous. The right training, at one
end, and employability assessments acting as feedback at the other, will
help both in goal-setting and tracking progress to make a larger proportion
of engineers in India employable.
There are considerably more males than females in engineering, but
with equal employability.
The ratio of male-to-female engineers is 1.96, which is higher than the
population ratio (1.06), but much lower than that of other countries, such
as United States of America (4.61). The percentage of employable male
and female engineers is similar across sectors, yet the current ratio of
females to males employed in IT industry is lower than that of the
engineering population. Efforts are required to encourage more females
in engineering education and jobs across the nation.
Concentrating on increasing quantity of engineers has impacted quality
drastically.
With regard to employability percentage in different states, it was found
that employability decreases logarithmically with the number of colleges
in the state (in sync with Arrow's hypothesis). This clearly shows that
opening more colleges is directly impacting the percentage of employable
engineers graduating every year. The need of the hour is to focus on not
opening more colleges, but improving the quality of education in existing
institutions.


The long tail of employable engineers is getting missed out by
corporations.
The report found that the top 100 colleges have higher employability as
compared to the rest of the colleges (as much as two to four times).
Despite this, more than 70% of employable candidates for any sector are
in campuses other than the top 100. It was found that 50% of employable
candidates for IT services companies and 28% of employable candidates
for IT product companies are not even in the top 750 colleges, and thus
form invisible pool to most employers. This signals that a large proportion
of employable engineers are ending up without any opportunity, which
is a dangerous trend for higher education.
The quality of education varies drastically, with only a very few colleges
at the top of the quality ladder.
With regard to employability distribution among campuses, it was found
that the quality of education falls steeply among the top-ranked colleges,
implying that even colleges ranked very closely have very different quality
of education. A large number of colleges are at exceptionally low
employability: bottom 45 percentile campuses have less than 1 in 100
candidates employable in an IT product company, while the bottom 20
percentile campuses have none. This means there is an urgent need to
reduce the quality-gap between colleges and get them above a minimum
threshold.


Methodology

The report is based on a sample of more than 55,000 engineering
students from 250+ engineering colleges across multiple Indian states.
All these candidates graduated in 2011.1 The analysis and findings of
this report are based on the results of these students on AMCAT: Aspiring
Minds Computer Adaptive Test, which is India's largest and only
standardized employability test. AMCAT covers all objective parameters
for determining employability in the IT/ITeS sector such as English
communication, Quantitative aptitude, problem-solving skills and
Computer Science and Programming skills. The test was conducted
under a proctored and credible environment ensured by Aspiring Minds.
Employability has been quantified based on the benchmarking studies
done at various companies in different sectors by Aspiring Minds.
Currently, AMCAT is used by more than 120 companies, including five
of the top-ten IT services companies in India, for their assessment and
recruitment solutions. The benchmark for employability in a profile and
sector is defined by a theoretical understanding and empirical validation
of the knowledge, cognitive skills and domain expertise required. The
benchmarks established for different profiles ensure both elimination of
unsuccessful candidates for a job (type I error) and inclusion of all
candidates who will be successful in the given job (elimination of type
II error). The same has been validated among multiple companies in
various sectors.
Together with the AMCAT scores, the various demographic details of the
candidates are also captured by Aspiring Minds' testing platform, which
has enabled a comprehensive and meaningful analysis provided in the
report.

The sample was statistically balanced across various parameters to be representative of the
true technical graduate population. A carefully chosen stratified sample was used for the
study.
1


I. Employability by Sectors
Engineers are absorbed in many different job profiles and sectors in the industry. The major
sectors employing engineers in large numbers were identified and studied to determine the
percentage of employable engineers across the nation. The criteria for employability are based
on the studies conducted with various corporations in these sectors, benchmarking their current
employees in various profiles through objective assessment based on AMCAT and establishing
feedback through on-job performance data. These benchmarks serve as a standard for several
large-sized companies across the nation.
Sector

Employability

IT Services

17.45%

IT Product

2.68%

Knowledge Process
Outsourcing

Graph

9.22%

Hardware Networking

36.57%

Business Process
Outsourcing

40.69%
Fig. 1. Employability of Engineering Graduates in Different Sectors

The employability of engineering graduates in different sectors is shown in Fig. 1. The following
observations can be made:
l

l

IT Product Sector: The employability in the IT product sector is exceptionally low, to the
order of 2.68%.2 This is because jobs in IT product companies require a strong understanding
of computer programming and algorithms. But the study found that the candidates strongly
lacked the required skills: around 92% of graduating engineers do not have the required
programming and algorithm skills required for IT product companies, whereas 56% show
lack of soft-skills and cognitive skills. One may note that the skills required by the IT
product companies at the entry-level are very much a part of the curriculum of engineering
colleges, which is a worrying sign for higher education.
IT Services Companies: The employability in IT services companies is 17.45%. It should
be noted that this has been calculated according to the current hiring philosophy of IT
services companies, where the candidate is not expected to already possess the required
software skills or soft skills, but is imparted the training over a period of 3 to 6 months.
The hiring criterion for this industry, thus, is that the candidate should be trainable in
technical and soft skills. This requires both a basic command of language and technical

Calculated across only those branches that have computer programming as a subject.

2


skills, together with requisite cognitive skills to respond to training in a short period of time.
Considering these rather lax requirements, the fact that only 17.45% of the graduates are
trainable into software engineers within a period of 3 to 6 months, is alarming to say the
least.
The research further shows that approximately 54% engineers are rejected because they are
not soft-skill trainable in a short period of time, whereas around 46% lose on technical
trainability.
Apart from focus on core technical skills, technical trainability can be improved by adopting
a quantitative approach to engineering problems. Bridging courses to hone English skills of
the candidates is a definite step toward improving soft-skills trainability.
l

Small and Medium Sized Enterprises: Whereas large companies invest considerably in
trainings, small and medium sized enterprises (SMEs) do not find it viable to build training
facilities or invest time in it. They want to hire ready-to-deploy manpower. For them, the
engineering graduates should be able to learn on the job and start contributing effectively
as soon as possible, typically in a month's time. This requires substantial competence in
domain skills. Whereas these companies do not expect the person to bring in in-depth
knowledge of computer science, the minimum expectation is to be able to write a decent
piece of code for a given problem, and the ability to debug and submit a working program.
Such candidates, who are software-industry ready, are just 3.25%. This explains why SMEs
find it so hard and time-consuming to hire.
If not corrected, this trend is poised to become a major impediment to the growth of
entrepreneurship and IT companies in India. One may recognize that the best economies
in the world are sustained by a strong SMEs sector, which in India is likely to suffer because
of the lack of right skills.

l

l

Knowledge Process Outsourcing Industry: As revealed by the research, the Knowledge
Process Outsourcing industry is likely to find 9 out of every 100 engineers employable.
Highly developed written communication and analytical skills are a must for this sector.
Though most engineers do not exhibit the required competence in English communication
(78% do not), a considerable number (56%) miss out on analytical and quantitative skills.
This calls for a fundamental shift in college instruction and assessment methodology, which
should be more inclined to developing analytical thinking and critical reasoning than
learning by rote.
Hardware and Networking Profiles: This sector comprises roles involving technical support
and network management. Candidates employed in this sector manage hardware and
networks within corporations, or carry out servicing roles providing support to consumers.
A good 36.75% candidates are employable in the hardware and networking sector, according
to the study. A person trainable in this role should exhibit basic understanding and usage
of computers—both hardware and software—as well as be comfortable in English and
exhibit a problem-solving approach.


l

Business Process Outsourcing Companies: A large proportion of candidates(40.69%) are
eligible for the BPO industry, both in tele-calling and backend processes. However, graduate
engineers do not form the preferred employable group for these companies due to the
belief that these roles cannot match their expectations, both in terms of remuneration and
job satisfaction.

In summary, there is a long way to go before engineering graduates in India become employable
for various industries and job profiles. Such an economy, with candidates possessing appropriate
qualification but unable to exhibit the right competence, is not only inefficient but socially
dangerous. More focused trainings and feedback through employability assessments at various
times will help improve the scenario.


II. Employability by Gender
It has been said that the progress of a society can be measured by the condition of its women.
This makes it imperative to study women's position in the higher education and technical
revolution in India. It is also important to understand whether there is any evidence for the
traditional belief that men make for better engineers!
This section tries to answer two questions:
l

How many women are opting for higher education in the technical domains in India?

l

Are men and women equally employable?

(a) Gender Ratio in Higher Education
In India, There are 106 males for every 100 females, making the sex ratio 1.06. In contrast, the
sex ration in engineering colleges is 1.96. This shows that a lower proportion of females make
it to engineering courses as compared to males. There could be multiple reasons for this,
which are beyond the scope of the report. Interestingly, India fares much better in gender ratio
as compared to the United States. A 2009 study suggested that the ratio of male to female
engineers in USA was as drastic as 4.61! Among different branches, it was found that computer
science and electrical engineering disciplines had the least number of females.3
The gender-ratio changes with respect to the state of the campus were studied. The MFR
(Male to Female Ratios) are shown in Fig. 2.

Fig. 2. Male-Female Ratio across states & Union Territories

*The male-female ratios for Jammu and Kashmir, Himachal Pradesh and North Eastern States have not
been included due to small sample size. Their indicative ratios are 9.88, 5.42 and 4.58 respectively.

http://it-jobs.fins.com/Articles/SB130221786789702297/Women-Engineering-Graduates-at-15-Year-Low http://
www.engineeringschools.com/women-in-engineering.html
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l

l

It may be observed that the southern states have a more balanced gender ratio than their
northern counterparts. This is in line with the population gender ratios across the nation,
where northern India has higher male-female ratio than southern India. Kerala emerges
as an outlier, being the only state having more females than males in engineering
colleges.
The regional comparison4 is shown in Fig. 3.

Fig. 3. Male-Female Ratio across Regions

An analysis was done to identify the states where the population MFR was not in line with
that of engineering campuses. Such a comparison is necessary to acquire some interesting
insights: in which states, inspite of a lower female to male ratio, more females go to
engineering schools; and for which states, even though the female to male ratio is more
balanced, lesser females end up becoming engineers. Given that the population MFR and
engineer MFR are quite different in magnitude, a direct correspondence can't be hypothesized.
However, a high correlation between population and engineer MFR should indicate that
similar causes are responsible for both.
A scatter-plot of engineering population MFR vs. total population MFR (data from Census
2011) is shown in Fig. 4. Engineering MFR vs. Population MFR shows a correlation of a
0.34, whereas after removing the three outliers, the correlation shifts to 0.58. This shows
that the total population MFR and engineer MFR do have some common variance and
probably some common causes. But given that the correlation is only moderately high, it
shows there are independent factors influencing the two ratios.
It can be observed that even though Bihar, Jharkhand and Gujarat have a moderate population
MFR as compared to other states, these states possess a very high engineering MFR. This
suggests that for some reason, fewer females become engineers in these states with respect
to their population statistics. On the other hand, Delhi and Haryana, even though they have
a moderately high MFR, have more females becoming engineers. The reasons for such a
variance are beyond the scope of this report, which could be lower education levels for
girls, socio-economic considerations, etc.
States included in each region are listed in Appendix, Section A.

4


Fig. 4. Scatter-Plot of Engineering Population MFR vs. Total Population MFR

(b) Employability by Gender
The analysis shows that employability for males and females is almost equal, with the
maximum difference being a single percentage point for IT Services and KPO. The
employability of males vs. females is depicted in Fig. 5.
Sector

Males

Females

IT Services

17.81%

16.75%

IT Product

2.88%

2.29%

KPO

9.63%

8.41%

Hardware Networking

36.51%

36.69%

BPO

40.57%

Graph

40.91%

Fig. 5. Employability - Males vs. Females

This slight difference in the employability of males vs. females is majorly due to the
difference in Quantitative Ability scores (see Fig. 6 for average AMCAT scores of males vs.
females). The 35-point difference in scores corresponds to 12 points of percentile difference.
Though these results show the same trends as observed globally, they need to be interpreted
from a nuanced perspective, given the debate on the bias of standardized testing scores
with regard to gender. Note that no significant difference in scores is observed in any other
modules.


Gender

Males Females Difference

English

474

474

0

Quantitative Ability

505

470

35

Logical Ability

461

459

2

Computer
Programming

413

406

Graph

7

Fig. 6. Average AMCAT Scores - Males vs. Females

Inspite of the equal employability of males vs. females, the ratio of males-females in
software industry is not same as that in campuses. Industry Statistics in 2009 showed an
MFR of 2.33 for IT services. This is higher in comparison to the ratio found in engineering
campuses. This shows that fewer proportion of female engineers are employed in the IT
industry as compared to males. The reasons for this—an analysis of which is beyond the
scope of the report—could be many, such as lower proportion of females opting for a
professional career; females not being comfortable with relocation; preference of males by
corporations; biases in hiring processes; etc.
In summary, we find that the ratio of male-to-female engineers is 1.96, which is almost
twice the population ratio (1.06), but much lower than that of other countries such as
United States of America (4.61). It was found that states with higher male-to-female engineer
ratio also show high population gender ratio, indicating that both these factors may have
common influence/cause. Finally, the employability of male and female engineers is similar,
yet the current ratio of employed males to females in IT industry is higher than that of the
engineering population.


III. Employability by Region
It is important to understand how employability varies by region. Do the demographic factors
of a region influence its employability? Do certain cities exhibit very different employability
patterns than their state? This section looks at employability percentages by grouping campuses
(and students' permanent address) by their region, the regions being defined according to different
demographic parameters. In cases where significant differences emerge, an attempt is made to
understand the causes. Very likely, the observation of these differences will prompt other studies
to find the causes for these differences, leading to proposals of intervention.
Herein is studied the employability by tier of city, across states, and the employability variation
between metros and non-metros and some key large cities.

(a) Employability by Tier of Cities
It may be argued that colleges located in Tier 1 cities provide better exposure to students.
They may also be the preferred destination for students who have the luxury of choice (and
are hence academically superior) and probably the first choice for candidates permanently
residing in Tier 1 cities. Tiers were allocated to cities according to population, with the
following benchmark (Table 1):
Table 1. Tier of Cities
Tier

Population

1.

Greater than 25 lakh

2.

5-25 lakh

3.

0-5 lakh

For the analysis, the top 100 campuses were removed from the data set, since these have
their own brand presence attracting students from across the country, and are therefore
outliers in their respective cities. Most of these colleges are the IITs and the NITs, which
source candidates through a nationwide exam.


The results of the analysis are presented in Fig. 7.
Sector

% decrease
% decrease
Tier 3 Cities
(T1 to T2)
(T2 to T3)

Tier 1 Cities

Tier 2 Cities

IT Services

17.23%

16.53%

4.06%

12.29%

25.65%

IT Product

2.48%

2.02%

18.55%

1.54%

23.76%

BPO

41.23%

40.38%

2.06%

35.64%

11.74%

KPO

9.02%

7.99%

11.42%

6.13%

23.28%

36.93%

36.26%

1.81%

30.77%

15.14%

Hardware Networking

Fig. 7. Employability across Tier 1, Tier 2 and Tier 3 Cities

One may observe a consistent drop in employability in all sectors according to the tier of
city of the campus location. Whereas the difference in employability from Tier 1 to Tier 2
is generally low, the decrease from Tier 2 to Tier 3 city colleges is drastic. Among different
sectors, the drop in employability from Tier 1 to Tier 2 cities is maximum in the IT products
and KPO sector. This shows that when higher-level skills are required (English, in case of
KPOs, and technical ability in case of IT Products), there is a larger variation between talent
quality in Tier 1 and Tier 2 cities. On the other hand, requirement of a lower skill-level
tempers this difference.
The employability in different sectors apart from IT Services is quite similar in absolute
terms across cities. This clearly shows that Tier 2 and Tier 3 cities cannot be neglected from
a recruitment perspective. The data shows that at least one out of every six engineering
colleges is in a Tier 3 city. This means that at least 12% of engineers employable in IT
Services are in Tier 3 cities - an absolute number of approximately 13,000. These candidates
could possibly fill up entry-level hiring needs of several IT Services companies.
The study investigated the skills deficient among students in Tier 3 cities (see Fig. 8).
Contrary to popular opinion, English language skills do not create the major difference in
employability. It is rather the quantitative ability and analytical skills, which make these
students ineligible for employment. This points towards better teaching practices through
problem solving and analysis. It is also surprising to see that the difference in ability in
Computer Programming and Algorithms is not too much. Teaching in colleges across tiers
of cities though similar, but is inadequate as far as Computer Programming and Algorithms
is concerned.


Tier 1
Cities

Tier 2
Cities

English

476

467

455

9

12

Quantitative
Ability

486

485

459

1

34

Logical
Ability

456

456

430

0

26

Programming 405

402

391

3

11

Average
Scores

Computer

Tier 3
Cities

Tier 2

Diff. Btw. Diff. Btw.
Tier 1 & Tier 1 &

Tier 2

Graph

Fig. 8. Average Scores across Tier1, Tier2 and Tier 3 Cities

(b) Employability across States
The research looked at the employability percentages according to states where the different
engineering campuses are located. The employability percentage for different states for IT
Services is shown in Fig. 9:

Fig. 9. Employability in IT Services across States and Union Territories.
(Some states omitted due to low sample size)

The following may be observed through this data:
l

l

Looking at the employability across states and UTs, it is observed that employability in
IT services companies is highest in North, followed by East, then West, and then South.
Delhi and Bihar-Jharkhand emerge as states with the highest employability.
Delhi has emerged as an education hub with high standards of education at all levels,
attracting the best minds from across the country. Whereas Bihar-Jharkhand may seem
paradoxical, one may understand this trend by the high self-selection effect. Bihar and
Jharkhand, put together, have around 35 engineering colleges as compared to 70-80


engineering colleges in any similarly sized state. This leads to a fierce competition for
engineering education and only the best end up getting into engineering campuses,
majority of which are run by the government. Contrast this with Uttar Pradesh
(300+engineeringcolleges), Andhra Pradesh (700+ engineering colleges) or Tamil Nadu
(~600engineering colleges), where engineering colleges are unable to completely fill
their seats.5
Explanation: Apart from other factors, it can be hypothesized that just the sheer number of
engineering colleges in a state negatively influences the percent employability. This hypothesis
is inspired by Kenneth Arrow's idea of higher education being a filter. To check this
hypothesis, the relationship between the percent employability and the number of engineering
colleges in each state was analyzed. A scatter plot between employability percent and
logarithm of number of colleges is shown in Fig. 10:

Fig. 10. Scatter Plot between Employability Percent and Logarithm of Number of Colleges

Interestingly, a very high correlation of –0.834 was found between IT services employability
and the number of colleges in the state. If the two outliers are removed, the correlation
becomes –0.91! This means that employability falls logarithmically with the increase in
number of colleges in a state. Further, the result is not improved by normalizing the count
by population or size of the state. The simplicity of the result is indeed intriguing, and
shows how adding more engineering colleges leads to a fall in the percentage of employable
engineers.
Even though the number of colleges is a major factor in guiding employability in a particular
state, it does not explain it completely. For instance, even though Tamil Nadu has lower
http://www.thehindu.com/news/states/tamil-nadu/article2337603.ece.
http://studyplaces.com/articles/411338-1-2-lakh-mba-b-tech-seats-remain-vacant-in-up-technical-institutes
http://ibnlive.in.com/news/engineering-seats-remain-vacant/191073-60-114.html
5


number of engineering colleges (~600) as compared to Andhra Pradesh (~750), it has a
lower employability percentage (8.33 as compared to 12.73). Similarly, Delhi has more
colleges than Bihar, but a higher employability. Employability for a state is a complex
interplay of several socio-economic and developmental factors. However, this does call for
a greater thrust on improving the quality of engineering education than just the number.
Analysis of IT product sector employability: The IT products employability was analyzed
to find out whether the same trends and hypotheses are valid for this sector too
(see Fig. 11).

Fig. 11. Employability in IT Product Companies across States and Union Territories

The observations are as follows:
l

l

l

It can be observed that the major trends remain similar to those in IT services, though
there are some minor differences.
Three states, i.e., Uttarakhand, Kerala and Chhattisgarh, show largely different ranks
with respect to employability in IT services and IT product companies. Whereas Kerala
and Chhattisgarh better their position with regard to IT Product employability, Uttarakhand
slips down. This is strongly indicative of better education within colleges in Kerala&
Chhattisgarh.
The correlation of logarithm of number of campuses to employability is –0.72,down
from –0.83 in the case of IT services companies. One hypothesis is that whereas the
quality of intake is a major factor in IT services employability, it is tempered by quality
of education at college-level in case of IT Product sector, which requires considerable
knowledge of computer science. The number of colleges being a proxy for intake quality
has a lesser impact on IT product employability, as compared to IT services employability.

Employability in other sectors across states shows similar trends. Their respective trends are
documented in Appendix B.


(c) Employability in Metros vs. Non-Metros
The research analyzed employability of candidates coming out of colleges in metro cities,
in comparison to those in non-metro cities. The general view remains that colleges in
metros produce more employable candidates due to better exposure and education, which
explains why parents often prefer colleges in metros as opposed to others in making an
admission decision. The employability figures based on the analysis are reported in Fig. 12:
Sectors

Metros

IT Services 18.87%

Non-Metros % Decrease
16.74%

11.29%

2.91%

2.56%

12.03%

KPO

10.41%

8.62%

17.20%

Hardware
Networking

37.71%

36.00%

4.53%

BPO

41.88%

40.08%

Graph

4.30%

IT Product

Fig. 12. Metro vs. Non-Metro Colleges

As it may be noted, even though colleges in non-metro cities have lower employability, the
difference is not too much. Only the decrease in employability in KPOs is much higher,
for which English comprehension and writing skills are very important. This is in line with
the earlier analysis which showed that there wasn't much difference in the employability
of candidates from colleges in Tier 1 and Tier 2 cities.
Sectors

Metros Non-Metros % Decrease

IT Services 20.18%

17.63%

12.64%

3.85%

2.78%

27.79%

12.02%

9.25%

23.04%

Hardware
35.97%
Networking

36.90%

–0.19%

BPO

40.89%

Graph

–0.76%

IT Product
KPO

39.31%

Fig. 13. Metros vs. Non-Metros: Employability by city of permanent residence

In contrast, when the employability of candidates with permanent residence in metros and
non-metros was compared (see Fig. 13), the trends came out to be quite different. There
is an appreciable gap in employability for IT product companies, and the gap in employability
for KPOs increases further. There are two potential hypotheses to explain this. Firstly,


candidates who born and brought up in metros have better exposure to computers and in
particular, computer programming, and thus they are more employable than their nonmetro counterparts. If the colleges were imparting computer programming education
adequately, this gap due to intake impact should have narrowed. Secondly, English language
skills are very important for Knowledge Process Outsourcing companies, and candidates
born and brought up in metros seem to acquire better English skills due to day-to-day
exposure to a larger English speaking population. This clearly shows that students coming
from non-metros are disadvantaged to a certain extent. Thus, there is a requirement of
better school education and exposure to computers and English to students in non-metros.
Secondly, colleges need to improve education methodology to be able to erase such
differences. On the other hand, as noted earlier, there is no merit to the argument that
colleges in the metros automatically produce more employable candidates.

(d) Employability in Key Cities
The study also compared employability within students graduating out of different metro
cities in the country. The results are reported in Fig. 14.

IT Services IT Product

KPO

Hardware
Networking

BPO

Delhi

39.78

10.91

27.59

53.37

54.78

Kolkata

25.30

4.51

14.98

44.33

47.31

Bengaluru

16.79

2.93

8.62

36.59

40.92

Hyderabad

16.52

1.70

8.28

35.94

40.64

Mumbai+Pune

16.12

1.17

7.45

38.34

42.62

8.35

0.53

3.40

26.60

32.19

Chennai

Fig. 14. Employability in different metro cities

The following observations are made:
l

The trends are similar to those with regard to employability in states. Delhi (North)
shows the highest employability, followed by Kolkata (East) and cities in the West, while
the lowest employability figures were observed among colleges in Southern cities. The
skew in employability is quite high; for instance, the IT product employability in Delhi


in as high as 1 in every 9 candidates and as low as 1 in every 200 in Chennai. Even
though Bengaluru has similar IT services employability as compared to other Southern
and Western cities, the city shows much higher employability for IT product companies.
This indicates that candidates in Bengaluru do much better at computer programming
and algorithms, even though they show similar English and cognitive skills. This could
be due to better exposure to computer programming either at home, schools or colleges.
l

The reason for this skew in employability is explained again by the trend in number of
colleges in each of these cities (see Table 2). The proliferation of engineering colleges
in Southern and Western India has brought down the employability figures. In comparison,
there are far fewer engineering colleges both in Delhi and Kolkata. This is despite the
fact that the population of Delhi is much more than Southern cities, being comparable
to that of Mumbai (see Table 2).
Table 2: Number of colleges and population in major cities
City

Approximate number of

engineering colleges

Population

Bangalore

78

5,438,065

Chennai (including Thiruvallur)

84

4,616,639

Delhi

35

12,565,901

Hyderabad

86

4,068,611

Kolkata

54

5,138,208

145

17,277,214

Mumbai and Pune

In summary, the study found that employability trends show significant variation with
respect to the location of the campus. Whereas employability percentage was found to be
similar in Tier 1 and Tier 2 cities (classified by population), the employability in Tier 3 cities
fell significantly. The major gap in skills was observed in quantitative ability and logical
reasoning skills, rather than command of the English language. With regard to employability
percent in different states, it was found that employability decreases logarithmically with
the number of colleges in the state (in sync with Arrow's hypothesis). Also, whereas there
was no appreciable difference in employability of students coming out of colleges in metros
and non-metros, there was a significant difference in employability of candidates born or
living in metros, versus the rest. This clearly shows that candidates who have spent a
significant part of their life time in metros get better exposure to English and computer
education, helping them become more employable.
The key learning of this study is that as a Nation, we need to emphasize more on quality
than number of colleges.


IV. Employability Variance in Campuses
It is known that the quality of intake, education and outcome varies dramatically across the
3,000+ engineering campuses in India. It is pertinent to understand how much variation is there.
Is it that most colleges have similar quality, with a few outliers, or whether there is a large
variance? What are the reasons for these variations? This section looks into such questions.

(a) Employability in top-tier Campuses vs. the Rest.
The study analyzed employability of campuses according to their ranking (as reported in
popular media). Campuses which fell among the top 100 on the list (according to various
credible public surveys) were segregated and their employability was compared with the
rest of the campuses. The results are depicted in Fig. 15. The following trends were
observed.
(i) The employability for IT product companies falls by four times from 8.44% to 2.17%,
where as the employability in IT services and KPO falls by almost twice (30.95% to
16.32%) and two-and-a-half times (21.69% to 8.22%), respectively. The fall is not so
steep when it comes to BPO and Hardware Networking.
Sector

Top 100

Colleges

Rest of the

Colleges

IT Services

30.95%

16.32%

IT Product

8.44%

2.16%

KPO

21.69%

8.22%

Hardware
Networking

45.05%

35.88%

BPO

47.29%

Graph

40.18%
Fig. 15. Employability: Top 100 Colleges vs. Rest

(ii) Given that the ratio of the number of top 100 campuses to the rest is more than 10, one
can conservatively estimate that more than 70% of the employable engineers for IT
product sector, and more than 80% for IT services and KPO, are in the so-called Tier
2 campuses. According to current trends, IT product and KPO companies do not source
from Tier2 campuses, which creates a large artificial dip in the supply of eligible
candidates. This is in line with what was reported in the2009 annual employability
report by Aspiring Minds.6

National Employability Report (Aspiring Minds), 2009

6


The study also investigated what skills are lacking in students of Tier 2 campuses (see
Figure 16). There is a gap of 22, 16 and 22 percentile points in English Communication,
Logical Ability and Computer Programming, respectively, whereas the gap in Quantitative
ability is 27 percentile points (see Fig. 16). This clearly shows that the maximum effort
is required to hone mathematical skills of the students, whereas consistent effort is
needed in other areas as well.

Fig. 16. Skill Gap: Top 100 vs. Other Campuses

(b) Employability in Govt. and Private Colleges
The research also analyzed the difference in employability between government and private
colleges (see Fig. 17). Interestingly, an appreciable difference in employability was observed,
with students at government colleges doing much better than those in private colleges. The
decrease in employability was around 35.1% for IT services and 58.06% for IT product
companies.
Sector

Govt.

Pvt.

% Decrease

IT Services

25.67%

16.66%

35.09%

IT Product

5.64%

2.36%

58.06%

KPO

16.23%

8.59%

47.07%

Hardware
Networking

42.61%

36.02%

15.46%

BPO

45.38%

40.30%

Graph

11.19%

Fig. 17. Employability: Govt. vs. Private Colleges


Fig. 18 depicts the difference in skills of students from government and engineering colleges.
It was observed that there is significant difference in skills in all areas, with the maximum
gap being in quantitative ability. This clearly indicates that government colleges attract
better students and probably impart better education as well. This is in contrast to the
trends worldwide, where some of the best institutions (such as MIT and Stanford) are
private.
Average
Scores

Govt.
Pvt.
Colleges Colleges

Difference

English

504

471

33

Quantitative
Ability

541

487

54

Logical Ability

485

453

32

Computer
Programming

443

403

Graph

40

Fig. 18. Average Scores: Govt. vs. Private Colleges

(c) Employability Variance across Colleges
In this section, we study the distributional properties of employability across colleges. The
employability of each college for the IT services industry was determined and arranged in
order of its rank (see Fig. 19).

Fig. 19. Employability Percentage of Students across Colleges for IT Services Companies


The following observations can be made:
l

l

The best of colleges have employability as high as 50%, whereas the bottom 30 percentile
colleges have employability of less than 10%. Around only 35% colleges have
employability more than the average figure of 17%, whereas the majority (65% colleges)
has it close to or lower than 17%. This clearly shows that there are a small number of
colleges with very high employability followed by a high number of colleges with very
low employability. Thus, even though the mean employability is ~17%, the median
employability is much lower.
Some simple calculations show that average employability in colleges in the top 30
percentile (around 750 colleges) is 28%, whereas it is around 12% for the rest of the
colleges. This implies that almost an equal number of employable candidates are there
in the top 750 campuses as compared to the rest (see Table 3. Values for IT product
companies are also given). Consider that no IT company in India has a campus recruitment
program beyond the top 750 campuses, which shows that almost half of the employable
pool, i.e., around 50,000 employable candidates in the country, is invisible to recruiters.
Table 3. Top 30 percentile campuses vs. the rest
Top 30 percentile campuses

Rest of the campuses

IT Services Employability

28%

12%

Percent Employable Pool

50%

50%

5.81%

0.97%

72%

28%

IT Product Employability
Percent Employable Pool

The following conclusions are drawn:
l

One may observe that the employability falls drastically toward the beginning, and more
gracefully toward the middle. This clearly shows that there are certain colleges which
have excellent employability; however, other colleges even close in ranking show a
drastic drop in employability. This is in line with the perception that certain colleges,
such as the IITs and state-run colleges, are much better than other colleges, which may
ranked just as highly. This is not a healthy trend, implying that deserving students in
these other colleges find themselves cut off from better opportunities.
To further analyze this hypothesis, the study looked at the employability for the IT
product sector. One would expect to see a steeper trend, since IT product employability
is more strongly influenced by college education quality (rather than just intake) as
compared to employability for IT services companies. The variation is shown in Fig. 20.


Fig. 20. Employability Percentage of Students across Colleges for IT Product Companies

One can observe that IT product employability falls to about 8% at Rank 10, down from
27% at Rank 1, which is a fall of three times. On the other hand, for IT services
companies, this fall was only around 1.5 times. Similar trends continue throughout the
graph and confirm the hypothesis that the quality of education falls steeply as one goes
down the list of the so-called top colleges, with close neighbors having substantial
differences in quality.
Some other observations for IT product employability are as follows:
l

The best of colleges have employability as high as 27%, whereas the bottom 45 percentile
colleges languish at less than 1%.This figure degrades to zero employable candidates for
the bottom 20 percentile colleges. Around only 30% colleges have employability more
than the average figure of 2.7%, whereas the majority (70%) colleges have it close to
or lower than the average figure.
In summary, the study found that the ratio of employability in top 100 colleges versus
the rest is between two to four times depending on the sector. Inspite of this, more than
70% of employable candidates for any sector are in campuses other than the top 100.
Government-run colleges show much higher employability than private colleges, with
skill differences in all areas, including English, cognitive skills and domain skills. With
regard to employability distribution among campuses, the quality of education falls
steeply among the top-ranked colleges, which implies that colleges that are neighbors
in rank have very different quality of education. There are a large number of colleges
with exceptionally low employability: bottom 45 percentile campuses have less than 1
in 100 candidates employable in an IT product company, and the bottom 20 percentile
campuses have no candidate employable in the IT product sector. Finally, we find that
50% of employable candidates for IT services companies and 28% of employable
candidates for IT product companies are enrolled in campuses ranked beyond the top
750, thus forming an invisible pool to most employers in India.


A. States Included in each Region

Appendix

The report provides various comparisons across regions. For these
comparisons, the country was divided into four major regions: North,
East, West and South. The constitution of each of these regions is given
below:
Table 4. Categorization of states across different regions
North

East

West

Delhi

Assam

Gujarat

Andhra Pradesh

Haryana

Chhattisgarh

Maharashtra

Karnataka

Himachal

Meghalaya

Rajasthan

Kerala

Jammu &

Orissa

Goa

Tamil Nadu

Jharkhand

Tripura

Madhya
Pradesh

West Bengal

Pradesh

Kashmir

South

Punjab
Uttar Pradesh
Uttarakhand


B. Employability by State
Employability variation of the state of campus residence has been explored in detail for IT
services and IT product companies in Chapter VI. Here, the trends for the Knowledge Process
Outsourcing Sector, Business Process Outsourcing Sector and Hardware and Networking companies
are reported. They follow similar trends as discussed in the chapter, and are presented here for
completeness.

Fig. 21. Employability in KPO Companies across States and Union Territories

Fig. 22. Employability in Hardware Networking Companies across States and Union Territories


Fig. 23. Employability in BPO Companies across States and Union Territories


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