University of Technology Sydney
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First I’d like to acknowledge the traditional custodians of the land on which we meet – the Gadigal people of the Eora Nation.
My Parliamentary colleagues the Deputy Prime Minister, Julia Gillard and Minister Mark Arbib.
I’d also like to thank members of the board of Skills Australia for being here: Philip Bullock, Heather Ridout, Professor Gerald Burke, Sharan Burrow, Dr Michael Keating, Marie Persson, Keith Spence and Robin Shreeve.
Because we got through the global recession better than most, we will face the challenges of recovery earlier than most. One of those is interest rates returning to normal levels, another is skills shortages.
Julia has outlined the scale of the skills challenge. Mark has detailed the task ahead in the resources sector. In that sector, and right across the economy a lot of the skilled workers we need will start as apprentices.
That’s why the reform we undertake here is so important.
We start on the back foot. In the 12 months to June last year there was a big drop in new apprentices. This is not surprising given the Global Recession. New apprentice numbers have dropped by 27 per cent. In some trades it was even worse. In trades like construction new apprentice numbers dropped by more than 30 per cent.
The same thing happened in the 1990s. In 1990 around 35,000 people started an apprenticeship in a traditional trade. By 1991 when the recession hit this dropped to 23,000 – a fall of 35 per cent. What is surprising is that it took another 13 years before we recruited more than 35,000 traditional trade apprentices a year again. This is one of the reasons we had a skills crisis before the global recession. We are determined not to repeat the mistakes of the past.
Last year Mark and I went on the road with Bill Kelty and Lindsay Fox talking to employers in the areas that have been hardest hit by the global recession. They all told us the same thing – they weren’t putting on new apprentices because they couldn’t afford to and that they needed more help before them could put more on.
That’s why we developed the Apprentice Kickstart. And as Julia and Mark have both mentioned, it has worked. We have recruited more than 21,000 apprentices over summer, bringing us back to the level we saw before the global recession. And we have done this in one year rather not 13.
It has also worked where it was needed, in key trades and key regions. Trades like construction have seen the biggest jump, up 36 per cent on last year. The 20 regions hit hardest by the global recession (where we have put local employment coordinators on the ground) have picked up 43 per cent of these new apprentices.
Regions like the Illawarra, a spawning ground for young apprentices, have done really well. In the summer of 2008 they recruited 502 apprentices. In 2009 this dropped to 389, down 22.5 per cent. They set themselves a recruiting target of 500 apprentices over summer.
The local newspaper (the Illawarra Mercury) and the Illawarra Apprenticeship Committee got behind the campaign. The Committee is chaired by local MP Jennie George and its members include: Sharon Bird (the other MP representing the Illawarra), TAFE, NSW State Training Services, the Illawarra Business Chamber, local apprenticeship centres, Group training companies, the Local Employment Co-ordinator and local union representatives.
Working together, not only did they hit their target but they exceeded it, they have signed up 506 new young apprentices. A lot of credit has to go to organisations like this and the Registered Training Organisations, the Group Training Organisations and industry bodies around the country who helped drive Kickstart.
But this is just the start.
The Changing Apprentice
We need to make the apprenticeship system more agile and make sure it meets the changing needs of business and the changing life and work experiences of potential apprentices.
When I was at school most apprentices went straight from school and into a trade. In 1995 almost 54 per cent of apprentices were aged between 15 and 19. Seven per cent were over 25. That’s not the case any more. Apprentices are starting older. Now, just over 30 per cent of apprentices are aged between 15 and 19. About 40 per cent are over 25.They have different expectations and different lifestyles. This trend is set to continue.
The number of women who take up apprenticeships is also rising and will continue to increase, largely driven by the growth of service industries. 15 years ago, 65 per cent of people who started an apprenticeship completed it. This has now dropped to 50 per cent. It’s something we have to address. There is enormous lost opportunity here. It costs business money, costs the apprentices’ time and costs us skills we desperately need.
Why do apprentices drop out? Research tells us that employment conditions and the quality of training and supervision are big factors. Apprentices and employers need the chance to try before they buy. Pre-apprenticeships give the apprentice and the employer the chance to see if they make a good match – and if the trade is the right fit. We know that apprentices who do a pre-apprenticeship are a lot more likely to complete their apprenticeship. That’s why the Government is looking at ways to improve pre-apprenticeship opportunities.
The number of apprentices finishing high school hasn’t changed much. If anything, it has gone down. In 1995, 36 percent of apprentices and trainees left school before Year 11 and 45 percent completed Year 12. Now around 39 percent leave school before Year 11 and 44 percent complete Year 12.
The Government’s target to increase school retention rates to 90 percent by 2015 means that this will change. More apprentices will spend more time at school before they start working full-time. This presents a challenge, but also plenty of opportunities. That’s why we are building Trades Training Centres in high schools over the next 10 years. We have already allocated almost $1 billion for 230 Trade Training Centres covering 730 schools. They will allow schools to enrol students into Certificate 3 level trade qualifications. They’ll also be able to access on-the-job training with an employer. Students like those at the Northern Territory Christian College. Five students there are school-based apprentices, doing a Certificate 3 in Engineering and Heavy Fabrication. As part of their on-the-job training, they’re helping to build the Trade Training Centre.
All trades need their apprentices to have good literacy and numeracy skills before they start. That’s why these skills are at the centre of the new national curriculum. To give you an idea of how important this is, look at my electorate of Blaxland where unemployment is almost double the national average (10 per cent) and teenage full-time unemployment is 45.2 per cent.
A few weeks ago I ran a jobs expo in Bankstown. More than 6,500 people turned up including the 1,500 people who squeezed through the door in the first half-hour. By the end of the day 500 people went home with a job. The important point here is that when I asked employers why unemployment in Bankstown is so high, they all said the same thing: the lack of literacy and numeracy skills.
The good news is that we are doing something about it. Two weeks ago Julia announced the Smarter Schools National Partnerships. I looked at the figures for my electorate and I could not believe what I saw: schools in Blaxland will receive more than $80 million for literacy, numeracy and extra teachers. To put this in perspective, this is about 10 per cent of the Smarter Schools funding for the whole of New South Wales being invested in one electorate. Blaxland is not often considered a marginal seat. This is funding but based on need.
Another example of the impact of basic literacy and numeracy skills. Last month I visited Kings Engineering in the Hunter Valley. The apprentice master Phil told me they had 20 apprenticeship positions. He received 850 applications. I asked him how he selected the 20. He told me it wasn’t hard, a lot of the applications demonstrated the candidate’s lack of basic literacy and numeracy skills.
We need to improve literacy and numeracy. We also need to improve the transition from school to work. School based apprenticeships can play an important role here. We have got to get them right.
We are implementing the recommendations of the COAG Taskforce on Australian Apprentices. This includes: making it easier for apprentices to access, defer and re-enter training; reforming pre-apprenticeships; helping out-of-trade apprentices complete their training through more effective mentoring and starting this year, the use of real-time and effective reporting of apprenticeship data allowing us to rapidly respond to the needs of different industries and regions. We’re also embedding green skills into the training that all new apprentices get from this year.
You can see how this is an integral part of the Education Revolution. The jobs of the future will require more skills, and different skills. I was in the US in January where the head of one of the business think tanks told me that 75 per cent of jobs in the US in the next decade are going to require post secondary skills. Research from Monash University predicts the same thing here.
It’s the action we take in schools, universities and in vocational education that will help us meet this challenge. That’s why Julia has described this as the next stage of the Education Revolution. In vocational education this will mean working with industry, TAFE and other providers to ensure skills are at the heart of our economy.
This week we have released a draft national curriculum for our schools and a national health and hospital network. We also need a national training system capable of meeting the skills challenges we confront. We can only do this by working together. It’s a big task. One of the greatest challenges we face. But as you can gather today, it is also one we are determined to meet.