Essay

All things to all people

VET as a vehicle of post-Covid recovery

ON 16 JULY 2020, Prime Minister Scott Morrison announced the launch of the $2 billion JobTrainer Fund. The media release declared that

JobTrainer will ensure more Australians have the chance to reskill or upskill to fill the jobs on the other side of this crisis. COVID-19 is unprecedented but I want Australians to be ready for the sorts of jobs that will come as we build back and recover. The jobs and skills we’ll need as we come out of the crisis are not likely to be the same as those that were lost.

As part of the suite of ‘Job’-branded policy responses to the economic crisis triggered by the pandemic, the Australian Government continued a long tradition of evoking the crisis-recovery role of the Australian vocational education and training (VET) sector. The language of ‘upskill’ and ‘reskill’ in these announcements signals a lot about the role governments are expecting the VET sector to play in pandemic recovery. First, the sector was tasked with supporting Australian workers to stay in employment during the economic crisis. This meant adapting to large scale stand-down and retrenchment for workers in sectors hit hardest by lockdowns, closed borders and social distancing restrictions. The language of reskilling also points to the expectation that the VET system is adapting to changed and changing workforce needs. In addition to preparing workers shifting from jobs in collapsed or declining sectors (particularly in tourism, hospitality and the arts) into those with growing opportunity and demand (including community services and health roles in aged and disability care, food production and supply), this means adapting to emerging industries, the changing way Australians work and navigate their careers, and preparing the Australian workforce for transition to a clean-energy economy.

The COVID-19 economic crisis is not the first time Australian governments have turned to the metamorphic role of VET to enable economic and labour-market recovery. In moments of crisis, governments around the world have moulded the skills and training sector to support recovery during and in the immediate aftermath of recessions and economic downturn. In 1992, Prime Minister Paul Keating framed VET as key to a competitive and successful economy in A National Employment and Training Plan for Young Australians. The plan included increased subsidies for traineeships, extra support for apprentices and access to six months of VET for those who were long-term unemployed. The underlying rationale was that VET could enhance the employability of jobseekers to ensure they did not remain a long-term welfare burden on the government. This casting of VET as a silver bullet to unemployment has been brought into sharp relief again during this most recent economic crisis. Yet much has changed, in both the training landscape and the world of work, in the intervening three decades between the Keating and Morrison announcements that each framed VET as a key policy mechanism for economic recovery.

To understand the potential efficacy and limitations of the recent and current VET policy responses, it is useful to know a little about the social and economic conditions that have shaped the contemporary role of VET. The objective here is not to attempt a comprehensive historical narrative of the Australian VET system, but rather to highlight the key social and economic turning points that have shaped the way VET has been cast as a pliable and metamorphic policy mechanism. VET has a rich historical association with industrial and political economic and productivity agendas, and has been relied on in times of calm and crisis to address unemployment, adapt to labour-market transformation and enable employment readiness for a breadth of learners, young and old.

 

THE TERM VET, while not uniquely Australian, is but one of many terms used internationally to understand and identify a branch of education and training that is applied, technical and employment-focused. Alongside the use of the term VET to encapsulate employment-focused education, VET is a term more frequently used in Australian public and policy discourses to refer to the sector of education and training provision. The establishment of technical training institutes in the late nineteenth and early twentieth centuries first developed around particular trades – for example, mechanics and art – but soon offered general technical education in subjects including mechanical drawing, geology and chemistry. What began as provision of technical education to working men was followed by the establishment of independent technical institutes across Australia. The Royal Melbourne Institute of Technology and the University of Technology Sydney, for example, were both founded as independent technical institutes during this time.

A key turning point for the Australian VET landscape came in 1974 when the Australian Committee on Technical and Further Education released the landmark Kangan Report. The Kangan Report recommended substantial Commonwealth funding to support technical and further education – marking the birth of the now ubiquitous TAFE institutions throughout Australia. Importantly, the Kangan Report led to a substantial injection of Commonwealth funds in TAFE, including an investment in the capital works necessary to expand technical institutes into a system of nationwide TAFE colleges. The years following the Kangan Report live on in the memory of VET practitioners, administrators and policymakers alike as a golden age in which VET came to be a distinct sector of its own in the Australian education landscape.

Almost twenty years after the emergence of TAFEs, and against the backdrop of the recession of the early 1980s, the transformation of industrial- labour needs and the collapse of the youth labour market, widescale reforms throughout the late 1980s and early 1990s brought the introduction of a formalised competency-based training system and a national competency- based vocational certification scheme. During this period VET qualifications were placed alongside high-school and university credentials within an Australian Qualifications Framework (AQF), and training packages were endorsed, in 1997, as the national framework for defining the skills and knowledge needed for different jobs.

So, by the late twentieth century Australia had a national system of public TAFE institutions, albeit governed and administered in different ways across the states and territories, and a national system of VET certificates under- pinned by national training packages that aligned those certificates with skills and knowledge for specific jobs. In Vocational Education: Purposes, Traditions and Prospects (2011), Stephen Billett, a leading Australian VET scholar, points to the social and economic contexts that underpinned the twentieth-century evolution of VET as having been driven by ‘growth and spawning of professional occupations in the industrial and post-industrial eras and the need for educational provisions to meet both the occupational needs and growing aspirations of a burgeoning middle class’. While the socio-economic profile of VET learners increasingly skews towards the middle class, VET still lives in our public imaginary as the pathway of the working class. It continues to be evoked in public and policy discourse as the poor-cousin sector, squeezed into the gap between school and university.

At the turn of the last century and during the first two decades of the twenty-first, the Australian VET sector was not immune to the prevailing global, neoliberal trends towards competition and profitability as the keys to economic progress. As in many other neoliberal economies, Australia adopted a competitive training market that recast the VET sector as a lever of governmental economic and productivity agendas and a demand-driven, industry-led tool for the production of human capital.

As the labour-market opportunities for jobseekers with or without a school completion certificate or with low education attainment declined at the end of the twentieth century, governments increasingly cast VET as a key policy response to the skills and educational needs of jobseekers. Within much of the international and Australian educational-policy discourses, VET was conceptualised as having a primarily utilitarian role focused on skills and qualifications for the labour market. In this way, VET has been recast again and again by governments as a key mechanism through which low-skilled and disadvantaged Australians access the skills and qualifications necessary to gain meaningful employment.

Despite the Australian labour market looking vastly different in 2020 than it did in 1992, when it comes to moulding the role of VET for enabling recovery, recent governments have returned to a familiar set of policy tools. Key among them are driving training participation through subsidised and fee-free training opportunities and promoting uptake of apprenticeships through incentives for both employers and prospective apprentices.

 

HOW EFFECTIVE HAVE these policy mechanisms been in shaping VET to the role of enabling recovery? In 2020, there were more than 3.9 million VET students enrolled across 4,000 VET providers. This is more than double the 1.4 million domestic and international students enrolled across Australia’s thirty-nine universities. On the surface, VET enrolment data for 2020, published by the National Centre for Vocational Education and Training Research, shows that training activity during the first year of the pandemic sustained a longer term trend of declining program enrolments and decreased numbers of students engaging in VET. In 2020 there were 187,000 fewer students engaged in VET than in 2019.

Long-term labour-market projections point to an increased expectation that jobseekers will possesses qualifications at AQF Level III or higher, which is out of step with the current decline in students training in higher level VET programs. But participation as a measure of the role of VET tells a limited story. It only captures the first step in the training journey. If we want to understand the tangible contribution that VET does and can make to the post-Covid economic recovery, we need to look beyond access to training in general terms. We need to look at the extent to which Australian VET learners are completing their training, in what ways that training completion is converting to a job outcome or improved employment situation, and how training activity is lining up with opportunities and demand in the labour market.

Not everyone who enrols in VET goes on to complete their training. Despite some improvement in recent years, overall completion rates for all VET qualifications are only 43.6 per cent. Completion rates are as low as 29 per cent in Certificate I programs, which skew towards learners with additional needs and who face complex barriers to accessing learning and work. In other words, completion rates are lowest among those who would most benefit from the increased educational attainment.

Engagement and completion are not the only things that are vital to consider. VET is an employment-focused sector, and the test is its utility for supporting jobseekers’ and existing workers’ access to and retention of meaningful and sustainable work. In addition to declining participation and stagnating completion rates, a closer examination of the type of training in which VET learners are enrolling highlights a mismatch with labour- market opportunities.

We can understand this mismatch by comparing VET participation patterns with industry-demand projections published by the National Skills Commission. Let’s look at three examples. Pre-pandemic projections identified a likely increase in demand for fitness instructors equal to 2,100 new jobs in the next five years. VET program enrolments in this field declined by 56.9 per cent from 2016–20. Perhaps the jobs thrown into the spotlight more than any other during the pandemic have been those of aged and disabled carers. Pre-pandemic projections indicated a likely increase of 54,700 jobs in the next five years. Despite this swelling demand and labour-market opportunity, program enrolments declined by 41.2 per cent from 2016–20. Another sector buoyed by the COVID-19 pandemic and projected to continue growing is transport and logistics. There are likely to be 3,600 further job openings for storepersons in the sector over the next five years, yet VET program enrolments have declined by 31.1 per cent.

 

HOWEVER, IT IS not just a mismatch between labour-market demand and training activity that is of concern. When it comes to the role of VET in supporting access to work or improving an employment situation post- graduation, only 56 per cent of VET graduates report an improvement in their employment. Furthermore, latest figures from NCVER show that only 24.5 per cent of all VET graduates are employed in the occupations associated with their qualification. For a system designed and structured around the skills and knowledge needed for jobs and job tasks, these figures speak to a serious inadequacy of the system and its potential for driving post-pandemic recovery.

One explanation for this is that qualifications in and of themselves are not enough to link jobseekers into work or to sustain their access to decent work. A lingering burden of the Global Financial Crisis is what the Productivity Commission has labelled the ‘lost decade of income growth’ for young people aged twenty to thirty-four. In spite of seeking out more education, real wage growth among this cohort flatlined. Instead of moving up the jobs ladder, improved qualifications pushed young people with lower qualifications off it all together. Compared with growth between 2001–08, wages have declined despite increasing levels of tertiary and higher education. This poses a challenge for VET and its capacity, through the existing competency-based training architecture, to enable labour-market recovery.

There is also a longer term trend at play. Mirroring global trends, Australian employers are calling for a flexible and responsive workforce to a level above which the current VET system is producing. The post-Covid recovery will require an agile VET sector that supports all jobseekers, but particularly young people beginning their working lives, to move rapidly into a changing labour market. This means a growth in employment-based training pathways involving a line of sight to long-term employment security and mobility, not just near-term job access. The use of VET as part of a recovery response needs to enable jobseekers, particularly young people at the beginning of their careers, to access the work experience, skills and networks required to gain not just any job but jobs that provide economic security in the near term and position them for upward mobility into the future.

To meet the changing skills needs of the labour market and to enable long-term labour-market security for graduates, VET needs to set the foundation for ongoing occupational mobility and adaptability. This is not reflected in the language used in Australian education policy, and more widely across developed economies, which has imbued compensatory and recovery responses of VET with an overtly short-sighted utilitarian role. The focus in utilitarian, human-capital driven approaches is on the provision of qualifications as needed in the labour market and by employers.

The core takeaway here is that driving participation in VET through subsidisation and fee-free training opportunities does little to shape VET to match a meaningful role in post-pandemic recovery. In the current crisis, many jobseekers, particularly young people beginning their working lives, do not have the financial security to delay access to work and commit time to complete training. This highlights the need for VET to enable training opportunities that clearly line up with jobs in high-demand and workforce- shortage sectors and offer opportunities for people to train and work at the same time.

This brings us to the role of apprenticeships, the most common form of employment-based training in Australia. Surely if the global trends and employer expectations are pointing to a closer link between training and work, then apprenticeships, as the core form of employment-based training, must be a winning model. The visual of the able-bodied construction apprentice in hard hat on a building site remains go-to political imagery for casting the VET sector’s role in the post-pandemic recovery. Despite more than forty policy reforms and changes to apprenticeships and traineeships at the Commonwealth level between 1998 and 2020, apprentices and trainees make up just over one in ten of all VET students. Similar to VET completion trends more broadly, completion of apprenticeships and traineeships remains stubbornly low, hovering at 55 per cent across all occupations.

Government pandemic responses throughout the last year have attempted to drive apprenticeship uptake through both learner and employer incentives. However, providing financial incentives has little impact on employers, as the biggest determinant of taking on an apprentice is the availability of work. If there is not enough work they do not take on apprentices. While apprenticeships can provide employment pathways, particularly for young people beginning their careers, they don’t address structural barriers for employer and industry involvement. These barriers include employer resistance to taking on unskilled workers or workers needing support, the time and resources to both develop programs and supervise employment-based training, and lack of understanding of VET. The fact that a large percentage of government investment in apprenticeships over the past decade has come in the form of wage subsidies to entice employers demonstrates this reluctance, while the primary reasons businesses – and particularly small- and medium-sized businesses – do not take on apprentices is the increased administrative and managerial burden that comes with them. Allied with the difficulty in identifying appropriate programs, many Australian employers do not feel that the skills being taught in VET class- rooms align with their needs, which further discourages their engagement with apprenticeship programs.

Traditional models of apprenticeship, long a favourite of governments and consistently featured in budget-night announcements, are limited as a tool for aiding labour-market access for a broad cross-section of the jobseeking population. Apprenticeship training is concentrated in a small number of occupations with strong gender segregation. In fact 91 per cent of all young trade apprentices and trainees are men. One in five of all apprentices and trainees are training as electricians and carpenters, and half of all young women in apprenticeships and traineeships are employed in just four occupations: as child carers, general clerks, hairdressers, and salespersons and sales assistants.

 

WHAT’S THE WAY forward? What sort of systemic change should we be pursuing to enhance the role of VET? Globally, workers are facing new challenges as economies and workplaces continue to change. The increasing automation and technological focus of workplaces means that traditional careers are in decline, with the corresponding growth occurring in industries that the Australian VET system is not yet fully equipped to address. The rapid pace of change, along with continued globalisation and the uncertainty of exactly what the transition to a ‘green’ economy looks like, necessitate a VET system that is adaptable and responsive.

The announcement of JobTrainer came alongside several state governments announcing free and heavily subsidised TAFE courses aimed at supporting those needing to transition into new roles and occupations as a result of the economic crisis. Policymakers of all ideological persuasions placed significant faith in the Australian VET system to form the backbone of the post-pandemic economic and labour-market recovery.

Government responses to date, with a focus on driving participation in VET, have done little to correct the mismatch between the nature of VET training and the needs of the labour market. Current funding and service-delivery models, underpinned by only 0.01 per cent of the GDP allocated to skills training (one of the lowest across the OECD), are not yet refined to enable VET to be effectively offered in tandem with the holistic social service and industry support needed to link training to lasting employment outcomes for VET graduates.

While there are wide-ranging reforms ongoing at the national and state and territory levels, they represent a continuation of decades of tinkering and restructuring of the role of industry voice and leadership in the system rather than any visionary reform that is needed to establish VET as a backbone of future economic needs. One of the key limitations of the current VET system is that it is structured narrowly around specific occupations. Because occupations are shifting and changing, and transitions require transferable skills for mobility, the current system fails to set jobseekers up for mobility within and between different jobs and industry areas.

Not only has the COVID-19 crisis amplified the existing mismatch between training trends and labour-market needs, it has also highlighted existing problematic demographic patterns, including a concentration of low- achieving and low socio-economic-status learners within training programs with limited mobility into sustainable and skilled employment. The review and updating of existing skill sets and qualifications is bemoaned by those in the sector as a slow and cumbersome process, often undertaken centrally and isolated from the diverse needs of local industries and employers.

How can governments break through this inertia that has seen VET recast as a recovery solution with minimal meaningful changes to strengthen its role? As we emerge from the second year of the pandemic, there is an opportunity to leverage the widescale social and economic disruption to drive the type of systemic change that produces a more enduring elasticity and efficacy in Australia’s training system. Rather than returning to a familiar mould of subsidies and incentives through which the system deploys a generic cookie-cutter VET solution for all, there is an opportunity to build momentum for an adaptive and differentiated system grounded in deep engagement between VET providers, local industry and social partners. It is through deep engagement, resourced and enabled through government investment, that these key VET sector actors can co-create high-quality training pathways that are relevant to local industry and employer needs and the diverse needs of learners at various stages of career development and attachment to the labour market. It is through a renewed focus on cross-sectoral and collaborative place-based partnerships that the VET system can provide jobseekers with both the qualifications and the work experience and networks required to not only gain employment but to be secure and upwardly mobile into the future.

What we have seen in the years leading into and through the pandemic is that a myopic focus on fast-tracking jobseekers into VET without strengthening the efficacy of VET for building capabilities aligned with the needs of the labour market leaves learners, particularly those at the beginning of their working lives, vulnerable to future economic shocks and long-term labour-market precarity. If VET is to play the key recovery role invoked in the JobTrainer announcement, the familiar moulds are no longer sufficient for the recasting that is needed. Furthermore, policymakers and those in the sector need to replace the dominant human-capital and utilitarian tools used so consistently in the last twenty years in favour of recasting the system as a core community resource. As we emerge from the economic and social disruption of the pandemic, now more than ever Australia needs a VET system that looks to the future of the country’s clean-energy transformation and focuses on building the capability, not just the skills, of individuals and communities for navigating that transition.

 

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