India’s construction sector is set to play a pivotal role in achieving economic growth targets as the country aims to create employment opportunities for up to 100 million individuals, according to a comprehensive report by Knight Frank India.
Currently, the construction sector ranks as the second-largest employment generator in the country, and projections indicate that it will employ approximately 71 million workers by the year 2023. However, a notable concern is the composition of the workforce. More than 80% of the labor force in this sector is categorized as unskilled, whereas skilled employees constitute just 19%, amounting to around 1.3 million workers. Among these, 4.4 million are categorized as core skilled employees, encompassing engineers, technicians, and clerical staff, while an additional 6.9 million are vocationally trained workers.
The National Skill Development Council (NSDC) reports that the real estate sector absorbs 87% of both skilled and unskilled employees, leaving the remaining 13% absorbed by the infrastructure sector.
The report by Knight Frank reveals that over the decade spanning 2012 to 2021, approximately 896,864 core skilled employees, including civil engineers, entered the workforce. Projections suggest that by the fiscal year 2029-30, around 1.7 million civil engineers could be seeking employment, growing at a Compound Annual Growth Rate (CAGR) of 10.4%, with an annual increment of 1.8 lakhs.
India currently boasts around 3,200 universities and colleges offering full-time courses related to the construction industry.
The construction sector’s role in India’s economic growth has been significant, with a Compound Annual Growth Rate (CAGR) of 11% over the past decade. Combined with real estate services and dwelling ownership, the construction sector contributes 18% to the nation’s total economic output.
During the financial years 2012-22, the Indian construction sector attracted a cumulative Foreign Direct Investment (FDI) inflow of $35 billion.
Furthering the economic impact, the real estate sector’s output is expected to grow from $650 billion to $1 trillion by 2030. This growth is anticipated to stem from increased demand in residential, commercial, retail, hospitality, and warehousing developments.
Shishir Baijal, Chairman and Managing Director of Knight Frank India, stated, “India’s economy has significantly grown over recent decades, positioning itself as one of the world’s fastest-growing economies. In parallel with economic expansion, the construction sector has also experienced remarkable growth. The sector’s contribution to the total economic output stands at nearly 18%, directly correlated with GDP growth.” Baijal underscored the importance of a skilled and semi-skilled workforce to optimize productivity levels in the sector and foster continued growth.
