Vocational training facing 'perfect storm' – report

Vocational training facing

Participation in vocational training is being affected by a range of converging realities that must be urgently addressed, a new report warns.

The Social Ventures Australia (SVA) report: Future Fair, supported by J.P. Morgan Research, examines major trends in the Australian labour market and how they are impacting the future prospects of young people, particularly those experiencing vulnerability.

SVA Director for Employment, Lisa Fowkes, says participation in vocational training has been affected by a “perfect storm” of poor policy decisions, a lack of strategic investment and an undervaluing of vocational training by the broader community.

“Declining rates of participation in vocational qualifications and declining investment by employers in training their workforce mean that there is less career mobility for those who start off with lower levels of education,” Fowkes said.

Greater collaboration needed

The Future Fair report’s recommendations include reinvesting in TAFE, reforming government-funded employment programs to support skills development and encouraging employers to step up their efforts to nurture young people in the labour market.

While many more young people are moving into university than in the past, not enough young people are gaining the types of vocational qualifications that are needed to fill skills shortages across the Australian economy.

Robert Bedwell, Chief Executive Officer, Australia and New Zealand at J.P. Morgan says creating widely shared prosperity requires collaboration between business, government, non-profit and other civic organisations.

“J.P. Morgan has been supporting workforce development programs to prepare underserved youth for the future of work for over five years in Australia,” Bedwell said.

“Our work is clearly demonstrating that alternative pathways – outside of traditional university dominated education – to quality jobs are absolutely essential for these young people.”

However, Bedwell said J.P Morgan’s work also revealed “systemic challenges” in the local market that he said need to be overcome.

They include insufficient investment in VET (vocational education and training), particularly in TAFE, although the report said that Commonwealth and State Governments “have started to recognise these issues”.

However, Fowkes said employers, too, need to step up their efforts.

‘Employers need to create more opportunities’

The recent Joyce Review into the VET system recommended that every vocational qualification include workplace learning – whether through a traineeship or apprenticeship, or a work placement.

“But not enough employers are creating these opportunities,” Fowkes said, adding that some governments are creating “very few opportunities” for young people who don’t have university education to move into high quality jobs.

“Even though most commentators agree that the future of work will favour those with higher skills, labour market assistance pushes young people to take any job – it doesn’t have a skills focus.”

If this doesn’t change, said Fowkes, young people will continue to face increased risk of poverty and of insecurity. 

“In the long-term inequality will increase and social mobility will be reduced,” She said.

J.P. Morgan supported the development of the Future Fair report as part of its five-year, US$350m global New Skills at Work initiative to prepare for the future of work and meet the growing demand for skilled workers.

“Vocational education is a key component of connecting people who have been left behind with in-demand, well-paying jobs to help them benefit from our country’s economy,” Bedwell said.

“As part of our commitment to supporting youth and broadening our talent pipeline, we are also launching a pilot traineeship program targeted at high school graduates to work with our operations teams in Sydney.”