Ausbuy

Compulsory Apprenticeships: Toward Reduction of Skills Shortage

August 1st, 2008

The Australian industry complains about the lack of skills of the Australian workforce, but compared with other OECD countries, like for instance Germany, does little training. Generating a sufficient skilled work force is an important challenge for the future of Australia.

Providing compulsory apprenticeships as a means of hope, sense and goals for the young generation should be regarded as a high priority national task and administered through a national scheme financed by a substantial “training levy”. Two decades ago Australia had a 2 percent training levy, which was never properly policed, compared with 6 percent in Great Britain. Companies or the public service should make compulsory available apprenticeships, measured as a certain proportion of their employees. School leavers, who did not enter the tertiary education sector, should compulsory undertake an apprenticeship. A new Federal Institute for Vocational Education and Training could be a nationally recognized centre for research into and development of initial and continuing vocational education and training. This Institute possibly could implement this national scheme and Vocational Committees, which would be filled with representatives from the various industries, from the trade associations, from vocational teachers and from the Ministries of Education could co-ordinate matters at a regional level.

Skills shortage has a long history in Australia, even back to the 19^th century prior to the foundation of the Commonwealth of Australia. As in former times when the Governments of the Colonies tried to foster the industrial and agricultural development through skilled migration, the central government followed the path of “importing” highly trained or experienced new migrants as a partial solution to the lack of a sufficient skilled Australian work force. Australia has mainly depended on immigration instead of training the young generation and providing part of the society with profound knowledge in one of various trades in the industrial, service and agricultural sectors of the Australian economy. On the other hand Australia donates foreign aid and plays a part in establishing a skilled work force in developing countries but, with the policy of skilled migration, Australia might be a factor of weakening the trained workforce in these developing countries.

In Australia thinking was dominated by the concept that skills could be taught in a lecture hall and there is little differentiation between education and skills. Combining education and training with the cooperation of the business and public sector is needed to reduce skills shortage. In particular since the 70s Australia tried to solve this lack of skills through the enlargement of existing universities and foundations of new universities but this approach created from time to time a proliferation of useless university degrees. Some people may regard this thought as provocative but the approach is open to question: Does Australia need so many universities (apart from being an export industry)? This implies a criticism of the concept of directing as many as possible students to university studies. Therefore the entry requirements should strictly favour relevant talents plus ability and should not be influenced by fees. Universities are not businesses.

The vocational state of affairs is certainly made worse by the sale of Australian companies to transnationals who move their head offices overseas, leaving in Australia lesser positions. Furthermore in times of economic downturn and crises there will be no solid safety net for Australia, neither sufficient Australian companies nor a highly trained Australian workforce.

Source: German Federal Institute for Vocational Education & Training 2008

Perhaps a deeper look into the German skills training system may present some background information to establish a system of compulsory apprenticeships. Germany’s two-track vocational training system is quite special internationally speaking. On completing school, some 60 percent of young people in Germany move on to learn one of the 350 officially recognized vocations included in the two-track system. This entry into professional life differs from vocational training based only in colleges such as customary in Australia. The practical part of the course takes part on three or four days of the week in a company or in public service; the other one or two days are spent with specialist theoretical instruction in a vocational school. The courses take two to three and a half years. In-company training is supported by courses and additional qualification facilities outside the companies. Training is financed by the companies, which pay the trainees and apprentices’ wages, while the Government bears the costs of the vocational schools. At present, 482,000 companies, the public sector and the free professions are training young people. Small and medium- sized business provides more than 80 percent of all traineeships. Subsequently the number of young people without a profession or traineeship is comparatively low in Germany, and is only 2.3 percent of those in the 15 to 19 age bracket. This combination of theory and practical work guarantees that the craftsmen and skilled workers have prime qualifications. The two-track system is based on statutory training regulations and on the range of traditional, updated and newly emerging, up-to-date training occupations (Facts about Germany, German Federal Government 2008).

Apprenticeships in Germany 1991 - 2006

	1991	1999	2006
Apprentices (total)	1,665,631	1,698,329	1,570,615
Ratio of Females	41.6%	40.5%	39.5%
Ratio of Foreigners	6.5%	5.9%	4.2%
Ratio of Examination Success	N/A	94.8%	95.1%

             Source: German Federal Bureau of Statistics 2008

In Germany the educational level of apprentices starting in 2006 was: Primary School (Hauptschule up to grade 10) 29.9%, High School (Realschule up to grade 10) 35.8%, Vocational Pre-School 18.2%, Matriculation (Gymnasium up to grade 13) 16.1%. The average salary per month of an apprentice was € 629.

It is noteworthy that this concept of compulsory apprenticeships, implemented into the Australian economy and society needs much further variation and adjustments, but it could serve the purpose of an intensive debate.

By Professor Dr.rer.pol. Wolfgang Fischer
Patron of the Australian Companies Institute Ltd. (Ausbuy), Sydney

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4 Comments »

1. Serenity_Gate -

   The solution to the State government’s privatisatin policies is to abolish those policies, not to install a federal policy to compensate for it.

   The eventual higher income of apprentices that does not justify the government dictating what sort of employment school leavers may do. Besides, all that would result in is some BAD apprentices. You only succeed at something you want to do and have the talent for. Also, trades are not the only high income vocations.

   Comment by free_enterprise — August 6, 2008 @ 7:07 pm

2. I read “free_enterprise”’s comments.
   Sure, for three years, my apprenticeship was a low paying job, which caused a lot of humour among my friends. However, after completing the apprenticeship, the wages were much more than those who laughed at me.
   State Governments can’t be trusted to supply apprenticeships, because privatising different industries cut apprenticeships by over 50% (see ABC’s rear vision story about the W.A. Railway shops).
   See how hard it is to get builders, plumbers, electricians and other tradespersons even to get a quote on a job, let alone a start date.

   Comment by Serenity_Gate — August 4, 2008 @ 7:41 pm

3. I agree with this. I was an apprentice in the printing industry commencing in 1971. It gave me special skills that have benefited me ever since.

   Comment by Serenity_Gate — August 1, 2008 @ 10:57 pm

4. You are recommending that the government take even more money from, and impose yet more regulations on, Australian companies. You also want the federal government to force school-leavers to forgo a higher income for three years.

   What you recommend would not help Australian companies and would only disadvantage them further. If apprenticeships are beneficial to our industries, companies will offer them. The issue is not apprenticeships for their own sake, but the success of Australian industry.

   Many school-leavers might otherwise choose to start businesses soon after school, or work a regular paying job long enough to save for the capital to begin one. So your idea would mean fewer Australian companies, and therefore fewer places for apprenticeships. It would also mean less business - fewer customers - for Australian business, because every school leaver, for every year, would be on a low income for three years following. This is a terrible thing to impose on our young adults, and extremely dictatorial.

   The remedy to the migration of skilled labour trained with our foreign aid is simply to stop foreign aid. Australian taxpayers should not be funding other countries, especially when we have problems here yet to be solved.

   The requirenent for university places has largely arisen from unneccessary increases in the government sectors, mostly for no useful and for some harmful reasons. Also, uni students are provided with income and initial payment of course fees by the government, which encourages more people to enter uni than genuinely need or want to. It is true, as you say, that training for some professions in universities has too much emphasis on theory.

   The individual contributing factors you mentionned should be addressed at their cause, not compensated for with government programmes.In many cases the solutin is merely to stop doing what is causing the problem, rather than doing someting to fix it. We should also be looking for the causes for why Australian industry is failing, not steering it to try to compensate for those causes. When you start fiddling with the economy and business, you don’t know where it will end up, especially when the government is doing it. Look at the record.

   Why would this necessarily be a federal scheme? Why not have state schemes? Making it federal would give the federal government even more control over the workplace, after it has taken control of workplace relations. The federal government is taking control over more and more state responsibities. When it has most or all of them, it will no longer be a federal goverment - there will effectively no longer be states.

   The biggest thing we can do to help Australian companies compete with transnationals is get the government off their backs and let their individual owners manage them as they see fit. This would be less costly and restrictive for all concerned.

   Comment by free_enterprise — August 1, 2008 @ 8:46 pm

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