India Inc.’s inclination towards paying higher stipends to apprentices continues to surge

Chandigarh, May 16, 2023: TeamLease Degree Apprenticeship, India’s largest private owned Degree Apprenticeship program from the house of TeamLease Services, has launched its flagship ‘Stipend Primer Report’ for FY-2022. A unique and detailed deep dive into apprentice stipend trends, the report indicates the growing positive synergy amongst India Inc. companies to pay higher stipends than the mandated minimum notified stipends. In fact, according to the report, the average stipend pay outs witnessed a 2% increase in FY-2022, compared to the previous fiscal. While the overall percentage increase has been a marginal spike, the report highlights a significant variation in stipend pay-outs across industries, cities and educational qualifications. In fact, stipend payouts in certain sectors have gained better traction than salary trends over the past year.
 

Majority of industries surveyed have indicated promising stipends for apprentices. In the manufacturing sector, six out of ten industries provided a higher stipend in 2022 as compared to 2021. Agriculture & Agrochemicals, with current stipend of INR 14,000, witnessed a 12% growth. Similarly, Apparel & Textiles (22%), FMCG (8%), Handicrafts & Jewellery (6%), and Infrastructure & Capital Goods (5%) also witnessed an increase in the payouts. On the other hand, industries like Power & Energy (-10%) and Healthcare (-7%) saw a decline.
 

In the services sector, 11 out of 13 industries provided a higher stipend in the fiscal. The top industries included Media & Entertainment (18%), Services including Repair and Maintenance (11%), Education (9%), Life Science (8%) and E-commerce & Tech Products (8%). However, despite the technology boom and the advent of 5G, Telecommunication (-4%) and IT/ITeS (-2%) saw a dip in the fiscal.
 

Sharing his views, Sumit Kumar, Chief Business Officer, TeamLease Degree Apprenticeship, said, "We are thrilled to unveil the Stipend Primer Report for FY-2022, which sheds light on the remarkable evolution of stipend trends in recent years. Our findings indicate a significant 2% increase in average stipends during the fiscal year 2022 as compared to the preceding year. This upward trend signifies a growing recognition among companies of the immense value and return on investment that come with engaging apprentices in their organizations. In fact, incidentally, stipend growth in India has outperformed salary growth in many industries, with many industries paying higher than the minimum notified stipends. Employers are willing to pay higher stipends than industry mandates as they see the value of investing in apprentices to bridge the skill crisis and create a sustainable talent supply chain. Companies are witnessing first-hand the transformative impact apprentices can have on their operations. In the last couple of years, even the government has taken various initiatives to promote apprenticeship adoption. Introduction of optional trade for broader coverage of job roles, availability of TPA support to industry to improve adoption and execution, financial incentives under the National Apprenticeship Promotion Scheme (NAPS) and National Apprenticeship Training Scheme (NATS), and the recent Direct Benefit Transfer (DBT), which streamlines the payment system, ensuring greater efficiency, transparency, and financial inclusion for apprentices, are all progressive steps. These are motivating even small and medium enterprises to scale apprenticeships. We are hopeful that lucrative stipends being paid out will attract more youth to take up apprenticeships that will help them enhance their employability and livelihood opportunities."
 

“As the demand for skilled professionals continues to rise, businesses are embracing apprenticeships as a powerful tool for talent development and acquisition. By providing valuable on-the-job training, mentorship, and real-world experience, organizations are equipping apprentices with the necessary skills to thrive in today's competitive job market. The evolution of stipend trends is a testament to the changing dynamics of the workforce and the strategic vision of forward-thinking organizations. Especially in the services sector, stipend pay-outs are increasing significantly, specifically in industries like Media & Entertainment, Services including Repair and Maintenance, Education), Life Science and E-commerce & Tech Products. We are delighted to witness the positive transformation for apprentices, which signifies a promising future for both companies and apprentices alike”, added Dhriti Prasanna Mahanta, Business Head, TeamLease Degree Apprenticeship.