Chapter 2. The evolving role of vocational education and training at the national and local level
This chapter describes the recent trends in VET and apprenticeship training in Australia at the local level. Over the last decade, the share of young Australians earning a tertiary degree, including Short-cycle, Bachelor, Master’s, Doctoral or equivalent degrees, has been increasing and consistently higher than the OECD average. This chapter also summarises recent reforms related to VET and apprenticeship programmes. Different trends related to apprenticeship training are highlighted. The share of Australians in-training and completion of apprenticeship training has declined in the recent years. Some of the states that experienced the most decline in absolute numbers are New South Wales, Victoria and Queensland.
Education attainment in Australia
Over the last two decades, the share of 25 to 34 year olds with tertiary education (defined as ISCED Level 5 qualifications and above1), has been increasing in Australia. In 2017, one in two 25-to 34-year-old Australians had tertiary education, which is higher than the average across OECD countries (Figure 2.1).
Note: Population with tertiary education is defined as those having completed the highest level of education, by age group. This includes both theoretical programmes leading to advanced research or high skill professions such as medicine and more vocational programmes leading to the labour market. The measure is percentage of same age population. As globalisation and technology continue to re-shape the needs of labour markets worldwide, the demand for individuals with a broader knowledge base and more specialised skills continues to rise.
Source: OECD (2018), Population with tertiary education (indicator). doi: 10.1787/0b8f90e9-en (Accessed on 09 October 2018).
Within secondary and post-secondary level, many students in most OECD countries tend to pursue general programmes as opposed to vocational programmes.
On average, a lower percentage of students enrol in upper secondary vocational programmes than in general programmes in conjunction with lower completion rates for vocational education. About 54% of people from OECD countries will graduate from an upper secondary general programme during their lifetime. Comparatively, the share of people earning a vocational degree during their lifetime is about 44% on average across OECD countries (OECD, 2017[15]).
Figure 2.2 illustrates the cross-country variations in programme orientation among 25-34 year olds whose highest level of education is upper secondary or post-secondary non-tertiary. This category includes general programmes designed to prepare students for further education, as well as VET designed to lead directly to the labour market. Many European countries such as Austria, Denmark, Finland, France, Germany, Italy, the Netherlands, Poland, Slovakia, Slovenia, and Switzerland have a substantial share of students whose highest level of education is in vocational education programme relative to general programme (Figure 2.2). This can reflect the tradition and development of VET systems and network in different countries. Australia and New Zealand have a similar share of students seeking a vocational education and general education programme at this level of education. In Australia, VET is one of the largest education sectors with an estimate of 4.2 million working age people (15 to 64 years) taking some form of VET in 2015 (Atkinson and Stanwick, 2016[16]).
Within vocational education programmes, certain fields of specialisation have attracted more students in recent years. In 2015, 34% of graduates in vocational programmes on average across OECD countries had a specialisation in engineering, manufacturing and construction compared to 27% of Australian graduates specialising in these fields. This OECD average goes down to 12% for business, administration and law (26% for Australia), 17% for services (11% for Australia), and 12% for health and welfare (26% for Australia) (OECD, 2017[15]).
Note: 1. Year of reference differs from 2016. Refer to the Table A1.1 for more details. 2. Data should be used with caution. See Methodology section for more information. 3. Data for upper secondary attainment include completion of a sufficient volume and standard of programmes that would be classified individually as completion of intermediate upper secondary programmes (16% of adults aged 25-64 are in this group).
Source: OECD / ILO / UIS (2017), Education at a Glance Database, http://stats.oecd.org/. See Source section for more information and Annex 3 for notes (www.oecd.org/education/education-at-a-glance-19991487.htm).
Impact of quality vocational education and training (VET) system
VET is an important part of the education system in most OECD countries and can play a crucial role in preparing youth for a smooth transition to work and develop relevant skills for the labour market needs (OECD, 2017[15]). Having a well-developed and high quality VET system and apprenticeship programmes can foster skills development and enhance opportunities to find jobs for youths, particularly disengaged youths (OECD, 2014[17]).
This correlation between VET and employability is strong at the upper secondary level, especially when the skills developed are in line with what the industry and labour market demands. Evidence shows that among young adults with upper secondary programmes as their highest level of education, those who graduated from vocational training tend to have higher employment rates and lower inactivity rates (OECD, 2017[15]). Figure 2.3 demonstrates this relationship to some extent among 25 to 34 year olds. For most of the countries, those with a tertiary qualification, including Short-cycle, Bachelor, Master’s, Doctoral or equivalent degrees, tend to have the highest rate of employment but those with vocational training tend to have a higher employment rate than those with general education. Australian young adults with vocational training tend to have a similar employment rates as those with a tertiary qualification.
Note: Countries are ranked in descending order of the employment rate of 25-34 year-olds with tertiary education, including Short-cycle, Bachelor, Master’s, Doctoral or equivalent degrees. The label upper secondary or post-secondary non-tertiary (general or no distinction) refers to "general" for countries with a value for "vocational" and to "no distinction" for the others.
Source: OECD / ILO (2017), Education at a Glance Database, http://stats.oecd.org/. See Source section for more information and Annex 3 for notes (www.oecd.org/education/education-at-a-glance-19991487.htm).
Overview of the Australian VET system
Australia’s vocational education and training (VET) system involves different layers of government where the national common framework is developed together with the state/territory and federal governments. Each state and territory government adopts the common framework into their own VET system. The Australian VET system has a nationally agreed system in place for qualifications recognition and quality assurance of training providers. It is also industry-centered because various industry stakeholders identify the required training outcomes (OECD, 2014[18]).
Table 2.1 illustrates the different levels of government and stakeholders involved in the vocational education system as well as other regional economic and employment policy.
National level
At the national level, the Australian Government Department of Education and Training is responsible for national policies and programmes that help Australians access quality and affordable early child care and childhood education, school education, higher education, vocational education and training, international education and research. This department is responsible for post-school education and training through three distinct, but closely interrelated, areas: 1) provide policy advice and support to the Minister, underpinned by research, analysis and evaluation; 2) national programme management; 3) working relationships with state and territory governments, industry, education and training providers, and other stakeholders.
Australia’s VET system is led by a council made up of Australian, state and territory government ministers responsible for industry and skills. The Council of Australian Governments (COAG) Industry and Skills Council (CISC) provides leadership and direction for the sector. In May 2015, CISC established the Australian Industry and Skills Committee (AISC) to provide industry advice to CISC and to approve nationally recognised training packages for implementation.
Both the federal and state/territory-level governments have roles in the governance, regulation and funding of Australia’s national VET system.
About 4 400 registered training organisations (RTOs) deliver VET in Australia through public Technical and Further Education (TAFE) institutes, universities, secondary schools, private training providers, enterprises, industry organisations, community-based providers and other government organisations.
As the national VET regulator, the Australian Skills Quality Authority (ASQA) is responsible for regulating RTOs against the VET Quality Framework. The framework includes standards for RTOs, the Australian Qualifications Framework, and requirements for fit and proper persons, financial viability and risk. ASQA is also responsible for registering all RTOs that offer courses to overseas students (Australian Skills Quality Authority, 2018[20]). Victoria and Western Australia have not referred their VET sector regulatory powers to ASQA, the national regulator, and maintain their own regulatory bodies. These two state VET regulators have limited powers to regulate RTOs that operate solely in those jurisdictions offering training and assessment services only to domestic students. The three VET regulators are responsible for accrediting courses that sit outside the training package development and endorsement process.
Training packages are a key feature of Australia’s national VET system. A training package is a set of nationally endorsed standards and qualifications for recognising and assessing peoples’ skills in a specific industry, industry sector or enterprise (Australian Industry and Skills Committee, 2016[21]).
The development of training packages follows a consultative approach, where industry is consulted on an ongoing basis to identify skills and training needs. Industry Reference Committees (IRCs) are the formal channel for considering industry skills requirements in the development and review of training packages and providing advice to the AISC (Australian Industry and Skills Committee, 2017[22]). IRC members are industry leaders who understand the skills needs of their sector, industry or occupation, and are supported by Skills Services Organisations (SSOs). SSOs are independent, professional service organisations that support IRCs to gather industry intelligence for the sectors they represent to inform training product development and review, ensuring training meets the needs of employers across Australia. IRCs are responsible for producing Industry Skills Forecasts, proposed Schedules of Work, Cases for Endorsement of training packages, and other submissions for consideration by the AISC. They also promote the use of VET in the sectors they represent. There are currently over sixty IRCs supported by six SSOs.
The AISC has also established a number of specific-purpose IRCs to provide an explicit focus on understanding the skilling requirements in sectors expecting to experience significant growth and significant workforce skilling requirements as a result of key industry or government priorities. These IRCs focus on identifying gaps in training products across tertiary education sectors to strengthen workforce development and support pathways for workers within and across industry sectors.
The AISC approves training packages for implementation, which are then formally endorsed by all skills ministers through CISC. According to its Terms of Reference, the AISC may also provide industry advice on the implementation of national training policies; providing direction to research priorities within the VET sector; provide industry advice to COAG on training provider and regulator standards and co-ordinate industry engagement in relevant COAG meetings.
Council of Australian Governments (COAG)
This is the peak intergovernmental forum in Australia, comprising the Prime Minister, State Premiers, Territory Chief Ministers and the President of the Australian Local Government Association (ALGA). Its role is to initiate, develop and monitor the implementation of policy reforms (including in VET) that are of national significance and which require co-operative action by Australian governments.
Australian Skills Quality Authority (ASQA)
ASQA is the national regulator for Australia’s VET sector, responsible for: registering training providers; ensuring that organisations comply with the conditions and standards for registration, including by carrying out compliance audits; accrediting VET courses.
State/territory and local levels
Each Australian state and territory government has a training authority with the main responsibilities of providing strategic direction to VET, through the development and implementation of policies; planning and reporting on VET strategies; purchasing training on behalf of their government, and administering funding and financial incentives for VET within the state/territory; regulating the VET sector locally, through quality assurance and performance monitoring; and supporting and advising training organisations, employers and the community on VET issues.
The state/territory training authorities are directly responsible for delivering policy, strategy and funding for skills development and training at the local level. One example of a common VET policy at the state level is the definition of priority skills lists, specific to each state, which are periodically revised through industry and community consultation and labour market research, and determine VET qualifications that are eligible for Government subsidies.
State training authorities consult and gather intelligence from industry and peak bodies to inform policy and strategy directions, and sometimes work in partnership with local community organisations to co-develop and fund skills development programmes. The case studies in the following chapters will show an example of a workforce development strategy that entails partnerships between state government departments and local industry (See Chapter 5), and another of a pre-employment programme which is an initiative of a local community organisation, co-developed and funded by a state training authority (See Chapter 6).
New South Wales (NSW)
The NSW Department of Industry, through Training Services NSW, is the State Training Authority, leading strategic policy, planning, funding, and regulating the VET sector in the state. It is also responsible for contract management of training providers and for implementing quality assurance and performance monitoring.
The NSW Skills Board is responsible for providing independent, high-level, strategic advice on the NSW VET system and for overseeing major reforms of the system. It receives administrative support from Training Services NSW. The Board has established two reference groups, which will provide input on specific matters relevant to VET and skills reform: an Industry Reference Group and a Provider Reference Group. For example, the Industry Reference Group will be consulted on matters such as the implementation of reforms to the VET system in NSW; labour market trends, skills shortages and current and future skills and workforce development needs; quality assurance and regulatory issues in VET, including industry engagement in independent validations of assessment; the performance of the VET system in delivering on industry skills priorities in NSW; areas for possible research and innovation, and emerging issues for the VET sector.
Industry Training Advisory Bodies (ITABs) are autonomous, industry-based bodies, contracted by the NSW Department of Industry, to represent their specific industries in:
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identifying industry skill needs, priorities and skills development issues for funded training in NSW;
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promoting training to industry and assisting in the take up of funded training;
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advising the Department about apprenticeship and traineeship arrangements;
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advising on the development, review and implementation of training packages;
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supporting the delivery of VET to school students.
They may also advise RTOs on registration processes and accreditation and review of courses, on a fee for service basis. There are currently 11 ITABs in NSW, covering major industry areas, and their board members represent significant enterprises, employers and unions of their respective industry sectors2.
Tasmania
Skills Tasmania is Tasmania's State Training Authority (part of the Department of State Growth), responsible for developing strategies and providing support, advice, and funding for the VET system within the state. Skills Tasmania developed an Industry Advice Framework in late 2013 following the dissolution of the industry-led Skills Tasmania Board on 30 June 2013. The Framework established the Endorsed Strategic Partners, which are industry associations with the role of providing high-level strategic advice on training and workforce development on behalf of their constituencies. At the end of May 2016, there were 13 Endorsed Strategic Partners representing specific industry groups.
Skills Tasmania has also hosts consultation sessions to gather advice on training and workforce development priorities and needs from a range of actors: 'Regional Industry Leaders' Forums', through which business leaders in regional areas are consulted; 'Community Conversations', for individuals, small businesses and community groups; and 'RTO Conversations' sessions. Skills Tasmania also employs Workforce Development Consultants, who consult with industry representatives to gather intelligence for informing skills development strategies and planning.
Queensland
The Department of Education and Training (DET) is Queensland’s State Training Authority, leading strategic policy, planning, funding, and regulating the VET sector in the state. Jobs Queensland is an independent statutory entity established by the Queensland Government with the aim of giving a strong voice for industry and regions on skills priorities and long-term workforce planning. To achieve that, Jobs Queensland engages with industry, industry associations and peak bodies, regions, communities, employers and unions to:
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provide strategic advice on future skills needs, helping government to prioritise its investment in VET;
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provide strategic advice on apprenticeships and traineeships in order to enable them to be a key pathway to employment and a skilled workforce;
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undertake workforce planning and development initiatives;
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commission research into future industry needs.
The evolving role of Apprenticeships
The number of apprentices and trainees in Australia has seen an increase in the early 2000s, particularly in metal and vehicle and building sectors. These two sectors still has the largest number of apprentices and trainees. However, since around 2012 several trade occupations, which include Technicians and Trades Workers as classified by the Australian Bureau of Statistics (2013[24]) saw a decline in the number of apprentices and trainees, especially in the metal and vehicle industry (Figure 2.4). This is in line with the skills shortage in occupations relevant to these industry sectors in Australia.
Source: NCVER, 2017, Historical time series of apprenticeships and traineeships in Australia, from 1963, NCVER, Adelaide.
Across different states and territories, New South Wales has had the highest number of apprentices and trainees followed by Victoria and Queensland. However, in the last five years, the number of apprentices and trainees has sharply dropped among these three states as well as South Australia. This could reflect an increase in the drop-out or cancellation rate and/or low commencement rates of apprenticeships among these states and territories. Given the projected increase in employment in many of these states with declining apprentices, boosting apprenticeship opportunities at the local level can help reduce the skill shortages in the states and territories.
Source: NCVER, 2017, Historical time series of apprenticeships and traineeships in Australia, from 1963, NCVER, Adelaide.
A closer examination of recent patterns across states and territories indicate that the share of apprentices and trainees in-training has been declining since 2014. In the Australian Capital Territory, the percentage of apprentices in-training dropped by almost a half in 2016 compared to 2014, and has increased at a slow pace in the subsequent years (Figure 2.6). This share has dropped in all Australian states and territories, and can signal several possibilities, such as reduction in available apprenticeship opportunities, decline in interest among students, and increase in dropout rates.
Note: Training rates are derived by calculating the number of apprentices and trainees (aged 15 years and over) in-training as at 31 March (NCVER data) as a percentage of employed persons (aged 15 years and over) as at February (ABS data). See ABS, Labour force, Australia, Detailed, Quarterly, June 2018, cat.no.6291.0.55.003.
Source: NCVER, 2018, Australian vocational education and training statistics: Data slicer: Apprentices and trainees, March 2018, NCVER, Adelaide.
The number of apprentices in-training has slightly declined in both trade and non-trade positions across all states and territories between 2014 and 2018. The drop in non-trade positions was more pronounced than in trade positions (Figure 2.7, Figure 2.8). For non-trade positions, the drop was the greatest in New South Wales, where the number of apprentices in-training declined by around 25 000 units in 2018 compared to 2014, and in Victoria, where the number of people in-training more than halved over the same period (Figure 2.7). Australian Capital Territory, Northern Territory and Tasmania had the lowest number of apprentices in-training in non-trade positions but the numbers stayed stable in the recent years.
Note: As at 31 March 2018 for in-training. 12-months ending 31 March for all other statuses
Source: NCVER, 2018, Australian vocational education and training statistics: Data slicer: Apprentices and trainees, March 2018, NCVER, Adelaide.
The number of Australians in-training in trade positions decreased across all states and territories, but to a limited extent. A large drop was registered in Queensland, where the number of persons in-training decreased by more than 10 000 unites between 2014 and 2018 (Figure 2.8). Similar to Figure 2.7, New South Wales has the largest number of apprentices in-training, followed by Victoria and Queensland.
Note: As at 31 March 2018 for in-training. 12-months ending 31 March for all other statuses
Source: NCVER, 2018, Australian vocational education and training statistics: Data slicer: Apprentices and trainees, March 2018, NCVER, Adelaide.
Figure 2.9 illustrates the long-term trend on the number of apprenticeship completions across states and territories from 1995. In 1995, the number of completions in 12 months was similar across most of the states and territories. As most of the apprentices are in New South Wales, Victoria, and Queensland, most of the completions come these states. The number of completions began to diverge from these three states compared to other states and territories throughout the period until 2012. Since then, these three states experienced a large drop in the number of completions, nearly by half.
Source: NCVER, 2017, Historical time series of apprenticeships and traineeships in Australia, from 1963, NCVER, Adelaide.
Similar to statistics on the percentage of students in-training, the number of completions in trade occupations decreased only slightly in the recent years whereas it dropped for non-trade occupations in New South Wales, Victoria, and Queensland (Figure 2.10, Figure 2.11).
Note: As at 31 March 2018 for in-training. 12-months ending 31 March for all other statuses
Source: NCVER, 2018, Australian vocational education and training statistics: Data slicer: Apprentices and trainees, March 2018, NCVER, Adelaide.
Note: As at 31 March 2018 for in-training. 12-months ending 31 March for all other statuses
Source: NCVER, 2018, Australian vocational education and training statistics: Data slicer: Apprentices and trainees, March 2018, NCVER, Adelaide.
Another trend to consider is the number of cancellations and withdrawals from apprenticeship programmes. If the number of cancellations increase then accordingly the number of completions will drop and this can be exacerbated if the number of apprentices in-training is also decreasing. The number of cancellations and withdrawals in New South Wales, Victoria, and Queensland has been higher than other states and territories in the last few decades but in recent years, the number of cancellations has declined (Figure 2.12).
Source: NCVER, 2017, Historical time series of apprenticeships and traineeships in Australia, from 1963, NCVER, Adelaide.
Within different trade occupations, the printing sector has the lowest and most stable number of cancellations (Figure 2.13). For all other trade occupations, this number has been increasing since the early 2000s. The largest number of cancellations is found among occupations in the building, other services, and metal and vehicle sectors. Furthermore, the number of cancellations in electrical positions rose three-fold compared to the early 2000s. Given that some of these sectors, such as electrical, metal and vehicle, face skill shortages in many Australian states and territories, more attention should be paid to reduce the number of cancellations and withdrawals in these sectors.
Source: NCVER, 2017, Historical time series of apprenticeships and traineeships in Australia, from 1963, NCVER, Adelaide.
One of the outcomes to consider for VET is the share of students that did not have a job prior to training but found a job afterwards. Figure 2.14 indicates the percentage of students who are employed after completing a VET qualification (by all providers) by state and territory in 2017. The figures are derived from the National Student Outcomes Survey, which is an annual survey of students awarded a qualification (graduates), or who successfully complete part of a course and then leave the VET system (subject completers). For all states and territories, about one in two students found employment following the training. This share is the largest in the Northern Territory and Australian Capital Territory and the lowest in New South Wales. This is in line with earlier charts where New South Wales has the highest number for both apprenticeship cancellations and completions among Australian states and territories. Although this cannot paint a whole picture, it suggests that New South Wales can seek measures to improve training to better reflect the unmet needs and also efforts to recruit and retain more students in-training.
Source: NCVER, 2017, VET student outcomes 2017, NCVER, https://www.ncver.edu.au/research-and-statistics/publications/all-publications/vet-student-outcomes-2017.
References
[16] Atkinson, G. and J. Stanwick (2016), Trends in VET: policy and participation, NCVER, Adelaide, https://www.ncver.edu.au/publications/publications/all-publications/trends-in-vet-policy-and-participation (accessed on 15 February 2018).
[24] Australian Bureau of Statistics (2013), ANZSCO -- Australian and New Zealand Standard Classification of Occupations, 2013, Version 1.2, http://www.abs.gov.au/ANZSCO.
[22] Australian Industry and Skills Committee (2017), National training system, https://www.aisc.net.au/content/national-training-system.
[21] Australian Industry and Skills Committee (2016), Industry Reference Committees: Operating Framework for the Development of Training Packages, https://www.aisc.net.au/sites/aisc/files/documents/operating-framework-201605.pdf.
[20] Australian Skills Quality Authority (2018), Jurisdiction, https://www.asqa.gov.au/about/agency-overview/jurisdiction.
[26] NCVER (2018), Australian vocational education and training statistics: Data slicer: Apprentices and trainees, March 2018, NCVER, Adelaide.
[23] NCVER (2018), VET Knowledge Bank Timeline of Australian VET policy initiatives 1998-2017 | VOCEDplus, the international tertiary education and research database, NCVER, Adelaide, http://www.voced.edu.au/vet-knowledge-bank-timeline-australian-vet-policy-initiatives-1998-2017 (accessed on 03 May 2018).
[25] NCVER (2017), Historical time series of apprenticeships and traineeships in Australia, from 1963, NCVER, Adelaide.
[27] NCVER (2017), VET student outcomes 2017, NCVER, Adelaide, https://www.ncver.edu.au/research-and-statistics/publications/all-publications/vet-student-outcomes-2017.
[15] OECD (2017), Education at a Glance 2017: OECD Indicators, OECD Publishing, Paris, https://doi.org/10.1787/eag-2017-en.
[17] OECD (2014), Education at a Glance 2014: OECD Indicators, OECD Publishing, Paris, https://doi.org/10.1787/eag-2014-en.
[18] OECD (2014), Employment and Skills Strategies in Australia, OECD Publishing, Paris, https://doi.org/10.1787/9789264207899-en.
[19] Productivity Commission of the Australian Government (2018), Report on Government Services 2018, https://www.pc.gov.au/research/ongoing/report-on-government-services/2017/child-care-education-and-training/vocational-education-and-training.
Notes
← 1. In the Australian context, this classification includes all qualifications at Australian Qualifications Framework (AQF) Level 5 and above, i.e. Diploma (AQF 5) and Advanced Diploma (AQF 6), as well as Associate, Bachelor, Master’s and Doctoral Degrees. Certificate-level qualifications are not included in this definition of tertiary education.
← 2. An assessment of the performance of NSW ITABs has been undertaken on behalf of the NSW Department of Industry, and is available at: https://www.training.nsw.gov.au/forms_documents/itabs/itab_review_report_2016.pdf