Key Takeaways: 

• Manufacturing competitiveness now hinges on continuous digital reskilling, not just capacity expansion.
• Industry-led curriculum design is critical to converting skilling policy into workforce productivity.
• Simulation, AI and workforce intelligence can sharply reduce skilling risk and time-to-deployment.

India has entered a decisive phase of its industrial evolution, where manufacturing scale alone will no longer determine global relevance. With the government’s ambitious goal to increase the manufacturing sector’s contribution to the GDP to 25 per cent, we are shifting from incremental growth to a strategic mandate for global leadership. However, as we look toward the 2026-2027 fiscal year, we must acknowledge that we are operating in a VUCA (Volatile, Uncertain, Complex, and Ambiguous) environment. The global landscape is no longer predictable; trade fluctuations, technological disruptions, and adoption of Industry 4.0 mean that the traditional manual-labor model is no longer sufficient for survival, let alone success.

To truly become a "global hub," an overhaul of our approach to education and skill development is impending. We need a "phygital" workforce, one that is as comfortable with data analytics and AI orchestration as it is with heavy machinery. As leaders, our challenge is to bridge the widening 53 per cent talent gap in high-tech roles and move toward a skills-first economy. The "Make in India" dream will not be sustained by capacity alone, but by our ability to develop an agile workforce capable of navigating uncertainty with digital confidence. 

The VUCA shift: New manufacturing skills for the industry 4.0 era

In the VUCA context, the skills required on the shop floor have evolved from routine manual labour to high-tech oversight. We are witnessing non-tech sectors integrate technology at their core. Manufacturing is no longer just "using" tech; it is embedding digital roles in supply chain, compliance, and experience workflows, effectively blurring the line between tech and non-tech employment.

• Technological literacy: CNC operators and industrial engineers today are custodians of automated throughput, quality consistency, and downtime reduction—not just machine operators.
• Digital integration: As non-tech sectors like manufacturing integrate GenAI and data engineering, workers must now be proficient in data-driven decision-making and predictive maintenance.
• Supply chain agility: The focus has shifted to end-to-end monitoring from material acquisition to delivery to minimise inventory and lead times.

Industry 4.0 cannot succeed with Workforce 2.0 models. Smart factories require smart workforce architectures - modular, digitally fluent, and continuously re-skilled.

The talent constraint: Structural bottlenecks to manufacturing scale

Despite the "Make in India" momentum, several bottlenecks persist in the domestic workforce:

• The skill gap: A notable shortage of skilled labor remains a significant barrier, driven by the rapid pace of technological advancement.
• Retention issues: High attrition is a critical challenge, with the temporary workforce seeing an attrition rate of 43.3 per cent in FY24. Additionally, nearly 66 per cent of female workers in some segments leave within a year due to safety concerns or difficult commutes.
• Informal employment: Approximately 82 per cent of the workforce remains informal, often lacking job security and social security benefits, which hinders long-term talent cultivation
• Gender gap: Women are significantly underrepresented in technical roles, making up only 10.5 per cent of the temporary workforce, often due to safety concerns and a lack of women-friendly infrastructure.
• Compliance complexity: A system of over 69,233 compliance and 6,618 annual filings places a disproportionate burden on SMEs

These interventions mark an important shift—from employment generation as a social objective to workforce capability as an economic imperative. However, policy must now be matched by industry execution. Without industry-led curriculum design, co-investment in training infrastructure, and shared accountability for outcomes, these initiatives risk remaining supply-side solutions to demand-side problems.

Strategic response: Industry & government synergies

The success of "Make in India" amid global uncertainty depends on a unified strategy between the public and private sectors. Recent policy catalysts include:

• National Manufacturing Mission (NMM): Launched in the 2025-26 Budget, this mission integrates policy across ministries to focus on "in-demand jobs" and clean-tech ecosystems.
• Employment-Linked Incentive (ELI) Scheme: With an outlay of ?1 lakh crore, this scheme incentivizes job creation by supporting EPFO contributions for new employees in the manufacturing sector.
• Production Linked Incentive (PLI) Schemes: PLIs across 14 sectors have already attracted Rs 1.32 trillion in investments and directly or indirectly created 8.5 lakh jobs
• Upgrading ITIs: The government is upgrading 1,000 Industrial Training Institutes (ITIs) into state-led, industry-managed hubs to skill 20 lakh youth using a modern "hub and spoke" model.

Technology as a capability multiplier: From tools to transformation

In a VUCA world, technology’s role in skilling is not automation, but acceleration—accelerating how quickly workers can learn, adapt, and perform at scale. For manufacturing, digital tools are no longer support systems; they are core capability infrastructure.

Technology as workforce infrastructure: Digital platforms compress learning cycles and enable workforce readiness at scale, making skills development a foundational element of manufacturing competitiveness rather than a support function.

De-risking skill creation at scale: Immersive and simulation-led learning allows manufacturers to build high-precision and high-risk skills without disrupting live operations, reducing safety incidents while significantly improving time-to-productivity.

From static training to adaptive capability: Real-time workforce intelligence enables leaders to anticipate skill gaps, redeploy talent faster, and continuously upgrade capabilities—transforming skilling into a living system that keeps pace with technological and market shifts.

Conclusion

Navigating the complexities of a VUCA context requires us to reimagine our workforce as the ultimate engine of industrial resilience. To fulfill the "Make in India" promise, we must transcend traditional functional oversight and embrace a "Leadership 2.0" mandate that orchestrates digital value across every factory floor. With a critical 53 per cent talent gap looming in AI roles by 2026, we cannot afford to wait for legacy systems to catch up; we must institutionalise AI-centric, experiential learning today. By equipping our people with capabilities in simulation governance and AI orchestration, we ensure that India does not just participate in the global market but leads it as a future-ready innovation hub. Our path forward is clear: a skills-first economy is the only way to turn global uncertainty into lasting industrial strength.

About the author:

Neeti Sharma currently serves as the CEO of TeamLease Digital. She has been a compelling leader in the TeamLease Services Group over the past 20 years, and has led multiple businesses including TeamLease EdTech and TeamLease Skills University - India’s first Skills University. With over three decades of experience, she guides the group companies with a clear focus on strategic growth and operational excellence.