The future of Australian apprenticeships Report of the stakeholder forum Canberra, 25 October 2016



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Introduction


Apprenticeships in the Australian context are defined as a system of training, regulated by law or custom, which combines on-the-job training and work experience while in paid employment with formal training (usually off-the-job). The apprentice enters into a contract of training or training agreement with an employer, which imposes mutual obligations on both parties. Traditionally, apprenticeships were in trade occupations (declared vocations) and were of four years' duration, but the duration of contracts has been formally reduced in some trades and the apprenticeship system broadened (VET Glossary, 2017).

A traineeship on the other hand combines off-the-job training, with an approved training provider, with on-the-job training and practical work experience, generally taking one to two years (VET Glossary, 2017).

Apprenticeships are a crucial employment pathway for many Australians and have long been a feature of our national approach to skills development. They have formed the cornerstone of training skilled workers in many small and large businesses, however in recent years the number of people entering into apprenticeships has declined. Meanwhile completion rates remain lower than desirable, despite persistent efforts by governments and industry to arrest the decline. An increase in commencements and completions is essential to maintaining a supply of skills as Australia looks to lift economic growth and productivity.

Aim of the forum


The future of Australian apprenticeships stakeholder forum was held in Canberra on 25 October 2016, and was co-hosted by the National Centre for Vocational Education Research (NCVER) and the Australian Government Department of Education and Training.

The forum aimed to:

  • stimulate discussion on the future of apprenticeships in Australia

  • identify strategies and potential actions to ensure apprenticeships continue to support industry workforce needs and contribute to productivity and growth in a changing economic environment.

This report outlines the approach to the forum and summarises the key issues and strategies identified by participants that they believed would make a positive contribution to the value, strength and growth of apprenticeships.

Approach


Sixty key decision makers attended the forum. Invited guests were drawn from a wide spectrum across the vocational education and training (VET) stakeholder group, representing employers and industry; peak industry groups; unions; peak training provider bodies; registered training organisations; academics; government agencies; group training organisations; and, Australian Apprenticeship Support Network providers. The list of participants is included as appendix 1.

Participants were encouraged to be bold and ambitious in the discussions and to consider fresh perspectives in order to generate ideas that could be used to shape and influence the future of apprenticeships and the apprenticeship system. Further, it was suggested that participants put aside the issue of apprenticeship incentives, which generally attracts passionate debate, as incentives had recently been the subject of advice to the Australian Government from an Apprenticeships Reform Advisory Group and was currently under consideration and discussion.

Discussion starter essays


To stimulate thinking and provide focus to the discussions at the forum, NCVER commissioned three essays from authors with different industry perspectives. Participants were provided with these three discussion starter essays in advance as pre-reading.

Each essay was based on a key theme (as indicated below):

  • Benefits and value

What is required for Australia to strengthen its value and commitment to a quality apprenticeship system? prepared by Megan Lilly, the Head of Workforce Development at the Ai Group.

  • Attraction

In the future how can apprenticeships be designed to make them more attractive to individuals and employers? prepared by David Carney, the Executive Director of the Career Industry Council of Australia.

  • Retention and completion

What needs to happen for retention and completion to be increased and who is responsible? prepared by Alan Waldron, the National Training Manager at Hutchison Builders.

These discussion starter essays confirmed the valued contribution and long history of apprenticeships in Australia along with their strong links to industry needs and the broader world of work. However, each of the essays also established, from their different perspectives, that for the apprenticeship model to remain relevant in today’s labour market, the model and system must be considered in the context of the changing economic and skills environment. A continued commitment is also required from government, employers, unions, the training system, parents and apprentices themselves. The discussion starter essays can be viewed at appendix 2.

Opening address


To set the scene for roundtable discussions, the forum commenced with an address by the Assistant Minister for Vocational Education and Skills, the Hon. Karen Andrews MP. The Minister emphasised the need to build on the strengths of apprenticeships while focusing on addressing key issues of:

  • raising status

  • achieving job ready graduates who gain meaningful jobs

  • lifting the quality of the vocational education system.

Strengths of the model were identified as the opportunity to be in productive paid employment while undertaking on- and off-the-job training and the excellent career outcomes attained by apprentices as demonstrated by data. Minister Andrews stressed the importance of both current data, and of ongoing, relevant research that continues to inform our understanding of the apprenticeship system and the labour environment. This ensures decision making and government policy is based on contemporary evidence. She urged participants to challenge the status quo and identify strategies and initiatives to lift both commencements and completions.

Data snapshot


NCVER provided participants with a precis of the current data trends in apprenticeships, derived from NCVER’s National Apprenticeship and Trainee data collection, 2015.

The analysis of the data paints a compelling picture. Figure 1 (over the page) provides a trend analysis of apprenticeship commencements since 2006. It indicates that there was a significant dip in commencement numbers in 2012 especially in the non-trades following the removal of some apprenticeship incentives and funding rates for training. Commencements in the trades however, have been more stable and appear less affected by changes to the incentives.

Apprenticeship completions have shown a similar decline, closely reflecting declines in commencements. Although there are some differences in trade and non-trade data, and across industry sectors and jurisdictions, overall the latest contract completion rates are 53%.1 Trade completions have been steady over time but declining slightly since 2014 (figure 2). It was noted that the individual completion rates for apprentices were generally higher. It is concerning though, that attrition remains high during the first year of training, despite continued efforts by parties from across the VET sector to positively shift the number of first years leaving the system.



Figure 1 Commencements (12 months to 31 December 2015)

Note: Apprentices commencements for the year to 31 December.


Source: National Apprentice and Trainee Collection, Annual 2015.

Figure 2 Completions (12 months to 31 December 2015)

Note: Apprentices completions for the year to 31 December.
Source: National Apprentice and Trainee Collection, Annual 2015.

Presentations and roundtable discussions


Presentations from the authors of the discussion starter essays were followed by interactive roundtable discussions. Each table had a suite of thought provoking questions for a facilitated discussion. The views of each table were then shared with all forum participants. Following the forum, participants were provided with an opportunity to give additional insight and opinion through email.

This report represents the consolidated views and opinions of the participants around the themes of:

  • Benefits and value

  • Attraction

  • Retention and completion.

In addition, the report also captured participants’ observations of the apprenticeship system and model, and highlights the overwhelming need to raise the reputation of VET within the wider community.



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