Study of Labour Market Choices and Outcomes in India

This study aimed to understand the skills training and employment preferences of India’s rural youth and examine the social networks and work-related mobility of these youth to identify factors that contribute to labour market choices and preferences.

Youth employment schemes like Deen Dayal Upadhyay Grameen Kaushalya Yojana (DDUGKY) and Rural Self Employment Training Institutes (RSETI) are bridging the skill gap among India’s rural youth and making them economically independent. As India’s workforce grapples with low rates of job creation, the need for having globally relevant skills and prospects for self-employment are underscored.

The aim of this study was to understand the skills training and employment preferences of India’s rural youth. The study also sought to understand these youth’s social networks and work-related mobility to see if these factors played a role in determining labour market choices and preferences. To achieve this aim, this study used a unique database that has been put together as part of the screening process of the DDUGKY scheme for candidate selection. ‘Kaushal Panjee’ (KP) is a particular skill register maintained by the MoRD for registering interested candidates for its skilling and livelihood-enhancing initiatives – i.e. both DDUGKY and RSETI, on which candidates can register through the KP app or the KP website. This KP database comprises candidates who have expressed interest in taking up training, not an assured sign-up for any programme.

This study was conducted in Odisha. Data on actual livelihood outcomes was collected through a mix of baseline data captured by the KP portal and additional variables captured through a telephone survey. This study estimated factors that predict self-employment versus wage-employment choices through a phone call to collect information on whether the interested candidates eventually sign up for training and, if they do, do they opt for wage-training or self-employment training. Econometric techniques, as well as machine learning techniques, were also utilised to estimate predictors and analyse any differences or similarities in the importance of predictors.


Findings from this study suggest that policy-makers, particularly in developing countries, can consider skill training programs as an essential policy tool for increasing employability, particularly among women. The results suggest the program’s positive and significant impact on the probability of wage employment. Regardless of the methodology employed, DDUGKY training is associated with 11 to 17 percent increase in the probability of being wage-employed. Women in India, particularly in rural areas, are uneducated, subject to gender discrimination in the labour market and lack the necessary skills to participate in the labour market. Thus, such policy initiatives can help them acquire specific skills and provide the opportunity to become part of the labour force.

Related Resources

Working Paper: Short Run Effects of Skill Training for the Unemployed Youth in India

Thematic Area

Small, Growing Businesses and Employment

Project Leads

Pratibha Joshi, Rashmi Barua, Harsh Nisar




Azim Premji University