By Ron Maxwell - CEO
Before the pandemic, Australia was already facing tradie shortages across the construction industry, with carpenters, electricians, bricklayers, plumbers and locksmiths amongst those in high demand. And in the wake of the pandemic and natural disasters, the challenge has only been heightened.
There are many factors at play. Alongside existing labour shortages, there is a backlog of construction projects as a result of COVID-related delays and scarcity of materials due to global supply chain disruptions. In addition, there has been an 80% increase in homes under construction compared to pre-pandemic levels.
All of this is creating a perfect storm for our construction industry.
How did we get here?
The pipeline of workers began drying up some time ago, accelerated by inconsistent funding models across the Vocational Education and Training (VET) sector.
Total apprenticeship commencements began declining in 2013, ending 12 years of solid growth, according to the National Centre for Vocational Education and Research (NCVER). And this downward trend continued right through to 2020.
We are now seeing some green shoots, with 2021 statistics showing the highest number of apprenticeship commencements since 2014. And in the construction industry, there are now 100,000 apprentices, a 25% growth on pre-pandemic figures.
While this sounds positive, the average apprenticeship takes four years to complete, so there is a lag. As a result of years of decline, 2021 saw the lowest number of apprenticeship completions since 1999.
What can be done?
While Australia may have to look to short-term labour force solutions, such as increasing skilled migration, the long-term solution lies in education and training.
We’ve seen a number of Federal Government initiatives targeted at increasing apprenticeship commencements in recent years, including the Boosting Apprenticeship Commencements wage subsidy. And while these financial subsidies are a great mechanism to drive immediate uplift, we must also consider how we build that all-important long-term pipeline.
Encouraging more young people into trades
On this note, I was heartened to read that the Federal Government is investing $38.6 million over four years to support women who commence in eligible trade occupations on the priority list. I’ve discussed the importance of encouraging more women into our traditional trade industries previously; for me, it’s a vital part of the solution.
Another area to consider, and one I’m incredibly passionate about, is how we position VET and apprenticeships in our schools.
A 2020 study by VERTO and Year 13 found that perceptions of lower earning power, lack of encouragement and limited promotion in schools were all significant barriers for young people in Australia.
VET and apprenticeships are often incorrectly positioned as a ‘poor cousin’ to university degree pathways, which is simply not the case. VET and apprenticeship careers offer many benefits, including excellent wage growth and job outlook.
A consistent model for VET
With the VET system funded at a state level, there have been inconsistencies over the years that have led to declining government-funded places and confusion for students and providers alike.
A healthy VET system is critical to Australia’s future, and achieving this will involve changes to the status quo.
As part of this, it would be great to see closer partnerships between industry and training providers. This model works very effectively in other countries, like Switzerland and Germany, to ensure industries are building the skills they need to thrive in the future.
The time to move is now
It won’t be a quick fix, but finding a sustainable solution is necessary, and we must start now.
I’ll leave you with some words from the Australian Chamber of Commerce and Industry, which reinforce this important message: “It is clearly understood, in industry and in government, that any significant break in apprenticeship training cycles can take over five years to see a sustained labour force recovery which is why a holistic approach to the skills shortage now is so important.”