Craig Fowler, 8n August, 2024
The questions explored in this ‘interview’ article focus on what Australian businesses and employers are doing for their industries and the economy in support of education and training of Australia’s labour force. Where and how are they investing in skills and/or partnering with others such as Universities and TAFEs.
Given that Australian business investment in R&D has steadily declined as a proportion of GDP, it raises questions as to whether or not their investment in skills, training and development has also declined, on an annual basis and by spending per FTE. Unlike competitor nations, Australia no longer formally tracks such data, the last survey being in 2001/02. Limited available evidence suggests larger Australian companies (only those 100+ employees, about 2% of all companies) presently spend in aggregate about $8 billion p.a., or $1,538 p.a. per employee. There is limited evidence of the purpose of this training, e.g. investment in AI or ‘enabling’ skills.
Australian businesses will pursue public training subsidies, if opportune. The majority are small (97% with less than 20 employees) and have less capacity to invest in skilling. For those that do invest, many use ‘in-house’ formal training (not accredited or qualifications driven), or they use informal non-structured training. There is no survey evidence of the purpose and design of such skills learnt ‘in-house’, the modes of learning, nor costs.
With regards to businesses partnering with educational institutions, such as Higher Education (HE) and vocational (VET), there is no ready source of national data that details such partnerships or records of business investment in employees, e.g. time-off in lieu, or (part) payments of student’s fees/loans, for ‘off-site’ full or short courses. Employers contribute (subsidised) wages and typically (part) pay students ‘off-site training costs in the national apprenticeship system, but total employers’ costs are uncertain. Employer participation in apprenticeships depends much on the availability of subsidy incentives, especially seen in traineeships.
Universities and businesses collaborate in setting multiple professional accreditation requirements and in work-integrated learning (WIL), both of which require significant work-based placements. The HE Accord report strongly encourages such cooperation. However, there is no detail as to where such cost imposts fall: on students, on what admin and placement costs now fall on Unis, or on what in-kind or direct costs employers pay.
The Australian Training Guarantee Levy, similar to the UK Apprentice Levy, was suspended on 1 July 1994 and abolished in 1996 after much negative publicity about its impact on small businesses.
The Government has recently ceased the ‘skills and training boost’ for small businesses linking businesses with training providers. Rather, it has pursued ‘levies’ at its border on skilled migrants and now planned on international students to hypothecate these revenue streams to education/training purposes.
The conclusion is that Australia’s statistical asset base and detailed quantitative and qualitative knowledge regarding these questions are patchy, lack recent detail, and are well less than that routinely tracked by comparable nations. As a consequence, national policy settings have been erratic or non-existent. Any Government-designed skills initiatives directed at businesses must avoid subsidising what good businesses already do. This is relevant to the forthcoming mega government investment, Future Made In Australia.
Learners highly rate job experience and wages, so a mix of work and training is the norm. Better measuring ‘on-job', work-related, and lifeong learning will become critical if such skills are to be incorporated into any credible skills passport. Employers will closely scrutinise any employee’s claim of skills ‘got-on-job’.
National approach to solving the ‘skills crisis’ has been dominated by: micro diagnostics of ‘current’ skills gaps and demand; detailed workforce planning; system adjustments (e.g. HE Accord); and by urging sharper funding for ‘priority’ skills, delivered by a ‘long-lagging’ training supply. Insufficient attention has been given to the criticality of business’s own role in training, their self-investment in skills and any partnering in training with education institutions. Without adding a business burden, we need smarter ways to find this out.
Read the full interview at:
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