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THE SKILLS MASTER
BY REHAB EL-BAKRY
Never one to underestimate the benefits of training,
Mohamed El Sewedy is leading the charge to upgrade the skills of
industry’s workforce. As head of the Industrial Training Council
(ITC), he has developed a comprehensive strategy to coordinate the
funding and dynamics of disparate training programs – ensuring
that Egyptian industry has a rich pool of highly skilled workers
to choose from.
There’s no point denying the obvious, insists Mohamed El
Sewedy. One of the biggest obstacles to Egypt’s industrial
development is the shortage of skilled labor. While the country
does boast a large workforce, its surging economic growth requires
that it constantly replenishes its labor pool. As head of the Industrial
Training Council (ITC), a national vocational training body established
as part of the state-run Industrial Modernization Center (IMC) in
July 2006, El Sewedy has made upgrading the skills of the nation’s
labor force his top priority.
Upon graduating from Cairo University’s Faculty of Engineering
in 1987, El Sewedy joined his family’s diversified cable manufacturing
business, El Sewedy Group, where he held several positions ultimately
becoming managing director heading up the group’s training
and development component. But on a personal level, he was always
occupied with finding practical solutions to the unemployment challenge
that has long plagued rural areas. “People always seem to
have endless problems that can’t be solved and they all boil
down to unemployment. The answer to their problems is almost always
job creation. The challenge is, how.”
El Sewedy had some ideas of his own, and key among these was that
Egypt must better utilize the latent potential of rural communities.
“I’ve always believed that there must be a way to utilize
the capacity of the unemployed people in rural areas in industry.
I believed that the key lay in training them and giving them the
skills they needed to be part of industry.”
Inspired by the successful household micro-business models employed
in China and India, El Sewedy embarked on a personal initiative
to tackle the unemployment problem in his family’s home village
of Taha in Sharqiya governorate. In 2005, he set up a small vocational
training program to train villagers in carpet making. His free three-month
program, which is still running, teaches villagers to weave carpets
using simple machinery and turn their newly acquired skill into
a business opportunity.
Upon graduation, villagers receive their own looms, which they purchase
over five years through installments. “They pay around LE
150 a year for the machines. We give them the raw materials, the
designs and the trainer supervises their work to make sure that
the product will be up to standard,” El Sewedy explains. “Then
we buy what they produce for LE 120 per meter. In one month, they
can more or less produce two meters. So you’re talking about
LE 240 or LE 250 per month, and in a village that’s very good.
Through this very simple idea, we transferred people who were unemployed
to contributing members of industry.”
The program is not only providing jobs to the 40 to 45 villagers
who complete the course each year, but as most of the graduates
are females – who tend to be the primary bread-earners for
their families, the skills are often passed along to other members
of the family. “My dream was [to] transform these households
into production centers,” he says. “The other benefit
is that you are solving the immediate unemployment problem, but
you are also influencing the perspective of the upcoming generation,
because when someone grows up seeing both their parents working,
they develop a strong [work ethic] at a very young age.”
El Sewedy’s personal initiative, which started with one training
center and grew to include 20 centers around the country, raised
the interest of Rachid Mohamed Rachid, the minister of trade and
industry. “At the time, I was working on ways to diversify
the training center idea to include other sectors. [Rachid and I]
began discussing ways to improve training for industry in general
and that was how the ITC was born. Suddenly, I ended up with half
a country to train,” he chuckles.
One early revelation was that there was no shortage of funding for
training. Egypt receives a substantial amount of international as
well as domestic funding for training. For example, the ITC’s
2007 budget is LE 500 million from the Egyptian government, plus
another d66 million funding by the Egyptian government and the EU
as well as another $12 million provided by the World Bank. Meanwhile,
hundreds of other training projects nationwide receive millions
of dollars in annual funding from dozens of international donor
agencies.
But the problem, as El Sewedy puts it, is that there was no single
coordinating body to keep track of where these funds were going
and what they were being used for. “This was a problem. Each
international donor agency was setting up its own training program
without any coordination with other donor agencies. So they weren’t
complementing one another. Often, once a project was completed,
all the hard work that was done sat on a shelf in someone’s
office.”
He says one of the main roles of the Industrial Training Council
is to coordinate the different projects and oversee the country’s
training accreditation body. “We are here to coordinate all
the funds that are being allocated to Egypt by international organizations
in order to ensure that these funds are used more effectively,”
he says. For the first time, the coordination of all vocational
training programs has been centralized. Depending on the preference
of the donor, the ITC either specifies how the funding can be best
utilized to achieve the donor’s goals, or simply monitors
the distribution of funds to ensure they reach their intended recipients.
By tracking all funding, the ITC is able to flag redundancies and
maximize impact.
Centralization has already demonstrated its benefits. El Sewedy
points out that previously a lot of money was being spent to build
training centers, while thousands were already in existence under
the management of various government bodies. “We don’t
need anyone to build any more training centers because we found
that there are 12,000 training centers belonging to the government
that can be better utilized,” says El Sewedy. By coordinating
the rental of these existing training centers to private sector
trainers, the ITC was able to cap unnecessary spending.
It is also directing a larger share of funds towards vocational
training, which El Sewedy argues has been ignored for too long despite
the obvious benefits that go hand-in-hand with a highly skilled
labor force. “Many people see [training] as a waste of money
even though anyone working in industry is very aware that there
is a huge shortage in highly skilled labor. Yet, even those who
do believe in training devote a lot more money and effort to managerial
and soft training.”
El Sewedy estimates that 90 percent of money spent on training by
both the public and private sectors in Egypt is spent at the managerial
level, while only 10 percent is spent on labor. “In fact,
what we need is the opposite. We need to devote 90 percent of training
budgets to train labor and 10 percent on management. The fact is,
everyone in the country’s industry needs training, but labor
needs it even more.”
With this in mind, the ITC has made vocational training its priority,
allocating funds to accredited private training firms and consultants.
In the case where a company desiring sector-specific training already
has an in-house training department, the council usually covers
the cost of “training the trainers.” The ITC does not,
however, conduct any training itself. “The government is not
going to [conduct the] training for many reasons. For one thing,
the government cannot pay the salaries of the private sector trainers.
Besides, almost all the trainers that have been developed over the
past few years [by the government] left to the Gulf.”
Significantly, all training is relevant. El Sewedy says one of the
biggest problems of earlier vocational training programs was that
the techniques employed and course material was outdated. Industry
is constantly evolving, and competitiveness requires constant change.
“Training content has to be updated every five years or else
the content is obsolete,” he says.
While the ITC has updated much of the training material, it is also
utilizing material developed by previous programs when appropriate.
“We’re not going to reinvent the wheel,” he says.
“There was a project that was carried out for several years
now that developed basic training programs for 109 different jobs
in Egypt. Just like many other training development projects, its
manuals were going to sit on a shelf until we decided to utilize
them properly. This way, a company can approach us requesting, [for
instance,] training for bus drivers. We already have a manual in
place and we show them the steps of the training and update sections
that they might need to suit their particular employee or sector.
Then we recommend a trainer to deliver this program. This is a lot
more efficient that spending time to develop the training from scratch.”
Working on a demand-driven system, the ITC also responds to industry’s
requests for worker training by providing tailored training courses.
It is also working concurrently to fill the gap in the market by
creating general packages for various sectors. “We’re
seeing what the market needs and we’re not just leaving it
up to them,” says El Sewedy. “We’re providing
them the training as a package, which includes what they need and
what we know they will need in the near future.”
The key ingredient is financial incentive. All ITC training is subsidized,
with the government covering 80 percent of the cost. “We already
know that most people are not convinced of the need for training,
but if they are getting it subsidized by the ITC, then they have
very little to lose. They’re being required to put up the
20 percent in order for us to get some sort of assurance that they
will not just have their staff receive the training and then not
use it.”
The formula also applies to individuals who want to upgrade their
skills. “We are making it possible for any Egyptian who wants
to receive training to come here and apply for the training. This
means that companies can apply on behalf of their staff, and individuals
who just want to better themselves can also apply and receive training.”
El Sewedy says the program’s structure is designed to appeal
to both companies and individuals. He says factory owners benefit
from having more efficient highly skilled workers, while workers
see the value in receiving training that will increase their chances
for advancement and higher salaries. The response to date suggests
the strategy is paying off. From July to December 2006, the ITC
trained 65,000 individuals, about 15,000 more than had been forecast,
with the textile and construction sector representing the highest
demand. The program’s success has encouraged administrators
to set the ambitious target of 250,000 trainees for 2007.
But ultimately, the success of the ITC’s ambitious program
will depend on the willingness of those in industry to accept change.
El Sewedy says the biggest challenge he faces is convincing people
that if they are prepared well for the change, they have no reason
to be intimidated by it. “If people can see change as a necessity
for their industry’s growth, then the process will go along
smoother, but that requires changing the culture, which will take
time. So for now, we are trying to hold the hand of industry in
order to show them the benefits that could take place if they accept
training and change.”
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