The Australian Council of Trade Unions (ACTU) says that with unemployment rising, rather than slashing the social safety net, we need a well-resourced VET system to provide affordable, accessible and high quality training. Ged Kearney outlines a 10-point plan for ensuring VET better serves all workers, including the most disadvantaged in our community.
At the start of August, Australia recorded its worst unemployment rate for a dozen years.
The unemployment rate of 6.4 per cent was the highest since June 2002, but if that wasn’t enough of a wake-up call, it was also the first time Australia’s unemployment rate had exceeded the United States’ since the Global Financial Crisis.
Almost 800,000 Australians are out of work.
Victoria is not immune from this jobs crisis. Quite the opposite in fact: the largest increase in unemployment in the year to July was here, from 5.6 per cent to 7 per cent.
Much of the attention around this has rightly been on the state of manufacturing in Victoria. The Productivity Commission has estimated that the closure of local auto manufacturing by Holden, Ford and Toyota will cost about 40,000 jobs over a number of years, with the impact to fall disproportionately on Victoria.
Geelong has been particularly heavily hit, with the loss of Ford compounded by the closure of the Alcoa aluminium smelter there.
Sadly, there are slim prospects for many of those companies’ mature workers hoping to find another secure job with decent pay and conditions over the rest of their working lives.
Equally concerning is that nationally, youth unemployment has risen to 14.1 per cent, and is even higher in certain pockets of the country, as a report from the Brotherhood of St Laurence highlighted earlier this year.
In parts of Victoria, unemployment affects almost one-in-five young people.
As Brotherhood of St Laurence executive director Tony Nicholson told The Age in late-August: Victoria is “hurtling towards a social disaster” and youth unemployment will be “a significant handbrake on the economy”.
The danger is that multi-generational unemployment will take root in Australia, with severe consequences for social cohesion, as it did in the United Kingdom following the rapid decline of the manufacturing heartland of the Midlands and the north under the Thatcher Government.
Tony Abbott’s pre-election promise to create an extra 1 million new jobs in half a decade was looking like a vain boast even before the announced closures of the carmakers.
Since then, we have not seen anything resembling a jobs plan from the Federal Government.
Indeed, the loss of jobs is likely to be hastened by the 2014-15 Federal Budget’s fiscal tightening.
Reduced spending or increased taxes in the short run would only dampen aggregate demand and reduce employment. The Federal Budget has already taken its toll on consumer confidence, which has likely contributed to the recent labour market softness.
Australia needs a plan for jobs, not a plan to slash the social safety net.
The most recent labour force numbers show the cruel folly of Eric Abetz’ and Kevin Andrews’ plans for unemployed people.
Rather than consult with unions and the community sector about how to stem the loss of jobs and help Australians gain meaningful employment, the Federal Government instead seems determined to pursue a strategy of vengeance and punishment against the unemployed, the old, mature age workers, and indeed all workers who through collective bargaining have secured decent wages and conditions.
VET is critical
In the face of this growing unemployment, a quality vocational education and training (VET) system in Victoria, spearheaded by TAFE as the public provider, will be critical in providing the necessary support, retraining and upskilling that is needed to help existing and displaced workers make the transition to new jobs, and for young people to get their first job.
Unfortunately, amid the various debates raging in the public arena over recent months, it seems little has been said about skills and the VET sector.
“As we head towards the state election in November this year, we hope to see a renewed interest and debate from all parties on the importance of our VET and TAFE system, and what our future workforce and training needs are.”
Yet the skills agenda is such a critical area of public policy. Each year almost 2 million students go through the VET system nationally. The skills and qualifications that it delivers are tremendously important for workers, as well as for the future skill needs of industry and the nation.
The VET sector has a historic and important role in supporting those facing disadvantage, with a proud tradition of providing ‘second chance’ learning options to those who may have left school early or faced redundancy later in life.
Now, more than ever, is the time to ensure we have a well-resourced VET system across Australia and particularly in Victoria; a system that provides affordable, accessible and high quality training that delivers the skills and qualifications needed in the labour market now and in the future.
This could take the form of standard vocational training courses and qualifications, but it could also encompass assistance with resume preparation, career advice, counselling, language and literacy training, skills assessment and recognition of prior learning.
Sadly, the capacity of TAFE and the wider VET sector to perform this role has been undermined by current policy settings and government policy decisions.
This has been no more evident than in Victoria over recent years.
The pursuit of a ‘contestable’ training market in Victoria and elsewhere has led to the rapid growth of private providers entering the system, attracted by the ready availability of public funding for high- volume, low-cost training.
In too many cases, this training has been skewed toward courses that are profitable for the providers offering them, rather than targeting genuine skills areas needed by the labour market.
In 2011 Skills Victoria reported a marked increase in VET training in a few occupations where graduates stated that the training had little or no vocational benefit. The oft-cited example of fitness instructor training is a case in point.
In the end, it is students and workers who have been penalised by this move to a ‘contestable’ system, because through no fault of their own they are left with a qualification that has little or no value in helping them get a job and sustain ongoing employment.
The VET model introduced in Victoria also denies publicly-funded training to those looking to re-enter the workforce, change career, or develop new skills, if they already had qualifications at the same level.
On top of these reforms, across Australia and especially so in Victoria, VET, and TAFEs in particular, have been hit by a series of severe budget cuts.
TAFE in Victoria has suffered ongoing course cuts, campus closures, rising student fees and major job losses, following on from the $300 million a year that was ripped out of the TAFE sector in the 2012-13 Victorian Budget.
Unfortunately, we saw evidence of TAFE funding cuts in the very regions where youth unemployment is particularly high. For example, Wodonga, on the Victorian-New South Wales border, is in a region with youth unemployment above 17 per cent, yet it bore the brunt of a $7 million budget cut in 2012, amid warnings at the time of the risk it posed to local jobs.
Across the state, course cuts and campus closures have affected many students who have to bear the cost of travelling to a more distant campus for their training. Increases in course fees and other charges have an even more direct impact on the affordability and accessibility of training, particularly for disadvantaged students. Often this can mean the difference between a person starting and successfully completing VET study and a person forced to drop out or not start in the first place.
As we head towards the state election in November this year, we hope to see a renewed interest and debate from all parties on the importance of our VET and TAFE system, and what our future workforce and training needs are.
Unfortunately, we are not getting any leadership or direction from the Federal Government on these matters.
A year since the 2013 Federal Election, we still have no real sense of where the Abbott Government sees the skills sector in providing opportunities for working class kids, in assisting displaced workers, or in linking training with jobs and ongoing employment.
Unfortunately, the Federal Government’s priorities are completely misplaced.
It announces a policy of ‘Learn or Earn’ but it takes away the very programs that support the capacity of people to do just that; programs such as Youth Connections, programs that provide mentoring for young apprentices or financial support to purchase tools, as well as language, literacy and numeracy programs.
It also abolished the Australian Workforce and Productivity Agency (AWPA), a body that provided a forward-looking focus on what our future skills needs will be. Instead of focusing on building skills for jobs now and in the future, the Government is pandering to its own prejudices about the unemployed, casting the debate in terms of ‘bludgers’ and ‘job snobs’, and ‘lifters versus leaners’.
“Measures such as removing all income support for up to six months at a time and requiring up to 40 job applications a month will only force the unemployed further into poverty and do not help them find work or develop real skills.”
Rather than supporting Australians to be ‘learning or earning’, it proposes a punitive and counter-productive approach. Measures such as removing all income support for up to six months at a time and requiring up to 40 job applications a month will only force the unemployed further into poverty and do not help them find work or develop real skills.
Recently, it announced a new VET Advisory Board, but failed to include anyone on the board who could represent the views of workers, students or the TAFE sector.
The Coalition in Victoria has demonstrated a similar disregard for engaging with unions and others who actually understand the VET system, with its decision in 2012 to withdraw support for the 16 Industry Training Advisory Boards, or ITABs.
For over 25 years, the ITABs had brought together employers, unions and trainers to work on skills issues spanning all sectors of the economy. In its place, the Government established an Industry Skills Consultative Council with no union or user representation. The new council was to convene an annual consultative conference. That never happened. The sum total of its work appears to have been three ‘consultative breakfasts’.
There is a better way. We call on governments at all levels to refocus their efforts on the importance and value of skills, and start to work collaboratively on this with all parties, including those who represent the interests of workers and students.
The following 10-point action plan would be a good start, in our view, to ensure the VET sector better serves the interests of all workers, including the most disadvantaged in our community.
1. A full public examination and review of the consequences of market-driven policies of contestability for the VET sector, including the impact on training, quality and student support.
2. In the interim, governments introduce measures for better regulation of the training market, including higher standards for entry into the market and rigorous enforcement of those standards.
3. The Federal Government work with states and territories to ensure the ongoing viability of TAFE as the public provider of quality VET, with a commitment by all governments to maintain TAFE funding in real terms.
4. Improving overall VET funding levels in line with the recommendation from AWPA for an additional 3 per cent funding per year to 2025 to meet the projected need for enrolment growth and increased skills across the workforce. VET funding models should reflect the true cost of providing training as well as wrap-around support services that assist disadvantaged learners.
5. Support for a strong apprenticeship system that includes greater emphasis on upfront support services for apprentices and employers, to help with more informed apprenticeship choices, and the establishment of a national custodian for the apprenticeship system.
6. Providing jobseekers with access to training within the VET system up to Certificate III level, while ensuring the training matches the jobseeker’s interests and skills, and aligns with current labour market needs.
7. Expanding the use of Recognition of Prior Learning (RPL) to capture the existing skills profiles of the unemployed and workers about to be made redundant, combined with upskilling to address potential skill gaps and training linked to identified jobs.
8. Establishing a network of workplace learning representatives or workplace champions to advocate for the training needs of workers and promote improved workplace literacy and numeracy.
9. Public funding support for VET should be directed at full, nationally recognised qualifications that give workers mobile and transferable skills. Firm-specific training should be funded by the employers who benefit directly from those skills.
10. Ongoing support for a co-contribution funding mechanism between government and industry that supports the upskilling of new and existing workers, including those sections of the workforce such as casual workers, who currently miss out on such training opportunities.
The 2014 Victorian election offers some hope that both major parties will refocus on these issues.
Opposition Leader Daniel Andrews at least has shown some recognition that unless there is investment in VET and skills, a generation could be lost to unemployment.
He has pledged to restore the TAFE system and reinstate funding for the ITABS, although we are yet to see the detail.
The ball is now in Denis Napthine’s court.
Ged Kearney is President of the Australian Council of Trade Unions.