Ensuring Vocational is Not Second Best Dr John Spierings Senior Adviser on Skills & Higher Education, DPMO & PMO

Some Global Trends Everything is mobile, everything is tradeable…nothing in the air is solid Increasing marketization of education across all sectors – higher education, schools, early childhood as well as VET – privileges private goods over public benefits Greater choice in education confers greater risks for individuals, without necessarily greater rewards VET is at the pointy intersection of public, student & industry interests - it is the education sector most entwined with changes in labour markets Labour markets are increasingly precarious in terms of hours, pay, duration & pathways. Entry level work opportunities in manufacturing, public service, finance sectors have evaporated across OECD Future mobility framed around achieving a senior school qualification, higher ed or VET equivalent 2

Australian Strengths National qualifications framework – provides certainty & clarity for students, industry & training providers. Point of difference with universities & schools VET qualifications are integrated into the broader tertiary education landscape Training packages establish the ‘units of competency’ in VET qualifications Joint employer & union management of packages via Industry Skill Councils Innovations such as group training schemes cover small employers & disadvantaged students Apprenticeship participation withstood the Global Financial Crisis 500 Trade Skills Centres in Schools – potential base to strengthen voced options for students 3

Snapshot of Australian Apprenticeship System Trend: Removal of govt incentives - non-trade commencements fell by 90K to 146K, 2012 to 2013 (37.5%) Trade commencements rose by 2.3% over same period Balance: 40% of commencements are in trades Pay: 55% of Adult Award in 1 st year (previously 35%); 80% for those aged 21+ Returns: Labour market returns for apprentices are strong – above average earners & lower unemployment Quality: 80% of employers & 87% of students express satisfaction with training quality 4

Australian weaknesses Australian apprentices are employees as well as students – training experience is strongly related to the quality of the enterprise Business still views training as a cost rather than an investment – poor data on business training expenditure Low industry participation - only 100,000 businesses employ apprentices & trainees. Leads to ‘free riding’, skills shortages, diminished opportunities Low completion rates – 50% attrition in trades; 60% in other qualifications. Long tail in literacy & numeracy capabilities (1:8 & 1:5 in lowest literacy & numeracy bands) No ‘master’ or ‘elevated’ trade qualifications Poor career guidance services for students 5

What needs to be done Public support for high quality institutions of learning dedicated to vocational skills Extend sector-based training levies to share the costs & reward successful employers. Enhance group training schemes Embrace problem solving, design skills & collaboration as core VET competencies Lift entry-level standards & qualifications of VET teachers Conduct external validation of qualifications & providers Attract powerful new friends to champion VET 6