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At the risk of being boring…..

Monday, August 7 2017

You may have noticed a bit of a trend over the last month or so. I have been looking at different ‘cuts’ of the data in both VET and Higher Education.

This week continues that approach in VET.

Why? Well we need to know everything we can about the sector. Its size, composition, enrolment and completion trends to name just a few.

That way we can consider what policy reforms would be appropriate and what was missed when things went wrong.

It also shows what is not available in the data.

Total VET activity (TVA) continues to fascinate me. It is the only true source of truth in VET. Of course, in 2015 there were some 4.5 million enrolments in 2015 nearly three times the government funded enrolments. 

I eagerly await 2016.

It remains a frustration to me that we don’t have point in time data, that is always up to date. The system is already in place but the data is not yet made available in a point in time manner.

We also need to have frank conversation about how to improve the transparency of the data even further when it is released. NCVER collects more data than is published and holding it back only limits our understanding of the sector. I should point out it was not NCVER’s decision to hold back the data, there were some concerns about commercial in confidence information and privacy – issues, which surely can be worked through.

So, in the absence of 2016 total activity, what is happening in government funded training?

There has been some media interest and commentary on this already, however it is still worth our attention.

There were 1.265 million students enrolled in government-funded VET across the country in 2016. This was up from 1.2258 million (a 3.3% increase) on 2015.

Now this is a surprising reversal of the declining numbers of government funded places over recent years as States and Territories have reduced their funding levels.

In terms of segments, TAFE accounted for 52.2% of student enrolments - an increase of 14.8% over 2015 and Private providers accounted for most of the rest, albeit down 7.1%.

This also reversed the trend in recent years, though with everything that has happened one could hardly be surprised.

I did note some concerns raised by a few commentators that the ‘stand out’ feature in the data was the significant increase in the number of students undertaking skill sets, which grew from 22,400 in 2015 to 89,400 in 2016.

We do need to think about what the growth in skill sets means, particularly at a time when the Training Products Review is underway. 

This enrolment growth was particularly a result of the ‘rebound’ in New South Wales (up 38.0%) following issues with implementation of its Smart and Skilled program in 2015. Student enrolments declined in Victoria (13.5%), Queensland (3.1%), South Australia (17.9%) and Western Australia (7.0%).

Skill set growth was particularly prevalent in NSW. While qualifications are critically important to a student’s employability and income potential, skill sets do serve the purpose of adding to someone’s ‘bag of tricks’ to help them get a job.

So, in that sense I applaud the endeavour to focus skills sets on jobs and let’s see how it works. A nimble system should mean those students are provided opportunities to further grow their skills and one day achieve a qualification.

The symbolic backbone of VET has always been apprenticeships. Well in that regard commencements were down 12.4% (10,327) over the year to 31 December 2016 to 72,707. They were down in all states and territories except the Australian Capital Territory and Tasmania.

Traineeship commencements for the year to 31 December 2016 were up 5.9%.

The figure that perhaps scares us is that the total apprenticeship and traineeship commencements of 167,100 were just over half the 320,700 reported five years earlier.

The question though is whether the achievement five years ago is the right benchmark, or was it inflated beyond comparison? That is, the record numbers were significantly boosted by the mining and construction boom. Put simply any analysis shows apprenticeships are strongly linked to the economy or business cycle. We are not likely to experience employment growth at those levels again so we need a different target.

The big drop in traineeships over the last five years was a deliberate decision of government to remove employment incentives from some services occupations.

From a policy perspective, the lessons here are that with increasing youth unemployment it may be time to reconsider the role of incentives, and that with the focus of the Skilling Australians Fund on apprenticeships we must look to modernising this tested model and not simply roll out programs from the past!

In terms of the true ‘acid test’, the completion rate for government-funded programs (Certificate I and above) commencing in 2014 increased to 38.0%, up from 34.5% for programs commenced in 2013.

We must continue to work on improving this, while noting many enrol in programs (like Skills Sets) without wanting to complete a qualification.
In terms of what people are studying, from 2015 to 2016 there was an increase in the number of Diploma or Higher level students while all other AQF levels slid.

I think we know what drove Diploma enrolments – enough said.

The declining enrolments at Certificate IV and below though must be a concern for us all.

As I have already mentioned, non-AQF student numbers (largely skill sets) increased strongly by 70,000 to 121,000 (with skill sets rising from 22,000 to 89,000 in New South Wales) and accounted for all the net increase in student numbers. Certificate III level continues to be the mainstay of the system but the number has declined by about 90,000 since the 2012 to 2014 peak levels to 505,000. A reduction in students undertaking off-the-job training for apprenticeships and traineeships was a significant contributor to the overall decrease.

Certainly, there is also anecdotal evidence that large industry is also increasingly relying on non- accredited training outcomes. This will over time impact of portability in the labour market.

Therefore, my final comment – the Training Product Review cannot just be another process with limited outcome – we need it to establish the foundation of our future.

Rod Camm
CEO
ACPET


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