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| ABC Radio National Peter Thompson 7.38AM 28th April, 2004. |
DISCUSSION ON THE NATIONAL SHORTAGE OF SKILLED TRADESMEN INTERVIEWS WITH Interviews with Jim Barron, Group Training Australia; Gillian Shadwick, TAFE Directors Association; Wilhelm Harnisch, Master Builders Association. |
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PETER THOMPSON – PRESENTER:
You know, it's never been easier in this world to buy something brand new but try to get something fixed these days and you'll have a devil of a job on your hands. It's one reflection of an alarming trend in this country, there's a growing gap in the market for skilled tradesmen. Part of the problem is the ageing population. In the building industry, for example, eighty thousand skilled tradesmen are expected to retire over the next five years and based on current training rates, there's expected to be a shortfall of forty thousand. The traditional trades like building and electrical are particularly hard-hit but there are also gaps in key professions like health and education. At the end of last year, a Senate inquiry reported on the national skills shortage, and earlier this month the federal government announced a strategy to deal with the problem. So why is there a skills shortage and what needs to be done about it? Jim Barron is the chief executive of Group Training Australia, an industry group exchange that matches apprenticeships with jobs. As such, it's Australia's largest single employer of apprentices and trainees. Gillian Shadwick is the chair of the TAFE Directors Association and director of the Western Sydney Institute, and in our Canberra studio is Wilhelm Harnisch who's chief executive of the Master Builders Association. Thanks to the three of you for taking part this morning. Jim, if I can begin with you, how serious is this problem? How serious is the skills shortfall? JIM BARRON – GROUP TRAINING AUSTRALIA: Well Peter, I think it's very serious. I think across all traditional trades, as you mentioned, we have national skills shortages. If you look at electrical, building, construction, metals, manufacturing, food, wood, furniture upholstering, we have national skills shortages. To me, it should be a barbecue stopper in this country as much as work and family, as much as child care, as much as tax. You know, we are facing a situation where, in some trades, we may not be able to provide the quality of service of delivery that you and I and everybody else expects when we want a plumber and when we want an electrician to fix something in our house. So it is a serious problem and we've got to do something about it, not wait around for another five years. We've got to do something about it now. THOMPSON: When you say there are these serious shortfalls, are you really talking about the future or is this being experienced in various industries right now? BARRON: Oh, it's absolutely been an experience in industries right now. In some of our companies, last year we would have three hundred vacancies for an electrician, this year you have thirty vacan - thirty applications. THOMPSON: Thirty applications for three hundred jobs? BARRON: Thirty applications. Last year, we had three hundred applications for one job, this year you have thirty applications for one job. THOMPSON: One job. But that still doesn't sit well. That still seems like there are plenty of people to choose from if you've got thirty applications for a job. BARRON: There is demand, there's not the supply. There are literally hundreds and hundreds of vacancies out there across the trades. Unfortunately, not too many school leavers are wanting to choose those - to fill those vacancies. They're going onto other disciplines. I think it gets back to how schools promote the value of an apprenticeship to their school leavers. We still have this culture where going to a university is far more - considered important than doing a trade, and yet once the school leaver hangs in there and gets through the apprenticeship, they are guaranteed a solid, well-paid job for life. THOMPSON: We'll come to the reasons behind that in a moment. Wilhelm, if I can bring you in as chief executive of the Master Builders Association, what's happening in building and the construction industry? How much of a skills shortage is there now? WILHELM HARNISCH – MASTER BUILDERS ASSOCIATION: At the moment, because of the cyclical high that we're experiencing in housing, we certainly have got skills shortages at the moment in a number of trades like bricklaying, carpentry, plastering, cabinet making. THOMPSON: Is that across the country? HARNISCH: Certainly, just generally over - across the country, yes, but particularly more pronounced in the capital cities. We're very much concerned, like Jim, about the longer term. As you said in your opening remarks that we've got a skills shortage that we predict to be somewhere around forty thousand over the next five years. Many of those problems are structural in nature. As Jim said - THOMPSON: What do you mean structural? HARNISCH: Well, there's one, the training system itself, the inflexibility that currently exists in there. There's the mindsets that exist perhaps within some of the TAFEs as well as the career advisers. As Jim said, there seems to be a view that somehow university is a far more attractive career option for young people. The reality is that many young people can find very productive and rewarding careers in trades. THOMPSON: Just let me deal with one more issue around perceptions. You still get houses built. I see buildings being built in every city, is the shortage … does it mean that costs go up and that things are delayed? I mean, what - realistically, what difference does this shortage make? HARNISCH: Well, difference does - it makes in the way, as you said, particularly cost in the short term, costs - particularly in this cycle has resulted in subcontract prices of some of the trades escalating by fifty per cent above what they were normally and - THOMPSON: Fifty per cent - what, a fifty per cent rise in recent years? HARNISCH: Yes, in the last couple of years, some of the rates of subcontractors have risen by fifty per cent because of the lack of supply. THOMPSON: There's certainly been a housing boom on too. I mean, that might be a thing which affects things, at least in the short term. HARNISCH: It certainly does but if you had an adequate supply of skilled trades, the problem of the cyclical nature of this industry would certainly be ameliorated. THOMPSON: Let me just pick up one other thing you say, that there are mindsets in TAFEs which are a problem. What do you mean by that? HARNISCH: Well, in terms of - we're very - look, the TAFEs have done a very good job in terms of training our skilled trades and they continue to do a good job, but the reality is that industry has moved on, the rate of change within the industry is quite rapid. What we need is more flexible delivery systems from the TAFEs. THOMPSON: What's that? What are flexible delivery systems? Shorter courses, is that what that means? HARNISCH: Well, that's certainly one, but for instance, a real example - a real life example is this. We've got apprentices in Newcastle that have to travel to Sydney because the TAFEs are unable or unwilling to deliver service deliveries in Newcastle. Now, that greatly disadvantages and makes people not want to enter trades particularly in regional areas. THOMPSON: Gillian, what about TAFE? What … how does TAFE see this skills shortage just in the broad first of all? GILLIAN SHADWICK – TAFE DIRECTORS ASSOCIATION: In the broad, TAFE has the same concern as the other people speaking about the skills shortages, and we think we are in an extraordinarily good position to address those through funded places. I would like, though, to take on the comment - THOMPSON: Let me just … when you say funded places, is it the industry that funds those places? Is it the government, is it students, is it a mix of the three? SHADWICK: It should be a mix of the three. I mean, government certainly funds the places. Students pay an administration fee and industry, when it's sending apprentices or trainees, covers their fee as well. Industry can also invest in places quite separately from that. I mean, TAFE offers not only funded … government funded places but also commercial programs which industries can buy and have delivered in as customised a way as they want. THOMPSON: If there are skills shortages of the sort we’re talking about, and we’re - so far, we’ve focused on traditional industries, if you like – construction, electrical and so on – do you find a diminishing number of people interested in those courses? SHADWICK: In the trades courses? We’ve actually had a significant growth in the building - people going into the building apprentices [sic] and traineeships, but in some of the metals and other areas, yes, there has been a decline and - I mean, there are a whole host of reasons why that’s the case. THOMPSON: Why are - why is that the case? SHADWICK: Look, a part of it is the - some stereotypical views about what those professions or those trades - what work - what the nature of work is. People have very old-fashioned views about what are really quite high tech and exciting industries. Part of this stems from just family perceptions, part of it from career advisers whom I think often aren’t up to speed on what - you know, what trade can offer to young people. Another big disincentive, though, for young people is the apprenticeships are long, they’re usually four - up to four years, and the pay is very low for the people undertaking that. And they can be being paid at a very low wage, and alongside them, there’s an unskilled labourer being paid three times as much, and it’s a big disincentive. THOMPSON: I can see, Jim, you’re nodding your head at those remarks? BARRON: Absolutely. And I think the issue of the length of a trade is absolutely fundamental to getting to the heart of this problem. I think a lot of - THOMPSON: Most apprenticeships are how long these days? BARRON: Four years. And I think a lot of kids these days see four years as being way too long. I know it takes you seven … ten years to become a doctor. I do question myself… THOMPSON: At sixteen, four years seems a long time. BARRON: Yes, it does. But as I said … and that’s what group training organisations do very well. They provide additional care and support to a lot of apprentices to get them through the tough early years. Once they stick to it, they are, as I said before, guaranteed a well-paid solid career throughout the rest of their life. But I think the issue of four years is fundamental to solving this issue, and to its credit, the government, when it announced its national skills shortage strategy last week, announced that they were going to address this issue of four years. Is it really necessary for every trade to go for four years and - THOMPSON: We need to make a distinction here between apprenticeships too and traineeships, which are much shorter. BARRON: Traineeships which can go for as short a time as six months, mostly twelve months, some two years. So - THOMPSON: So, what’s the difference then between someone entering a trade, say the metal industry, and they’re offered a traineeship versus an apprenticeship? BARRON: Well, if they go on to the metals, they’re not - they’re not offered a traineeship per se, they’re offered an apprenticeship. Traineeships were brought in under the government’s new apprenticeship system in 1996 where the system was opened up. It just wasn’t four year apprenticeships, as we all know them. It was traineeships. So, under the umbrella of new apprenticeships, you have six to twelve month traineeships, possibly two years in some cases, and you have the traditional four year apprenticeship. So, everything is classified as a new apprenticeship these days but you still have the distinction of a traineeship which is primarily in the retail, hospitality, service industries, some would say- THOMPSON: And I should stress there, there’s not a shortage in those sort of industries, is there, of retail, hospitality services? BARRON: Certainly not. And - certainly not. And the great majority of the new entrants under new apprenticeships have been in those industries as well as existing workers. The growth in traditional trades - and I must say, I hate the word traditional but they are still in this very modern world needed as much as they were fifty years ago, and they’ve been updated as we go along. But the growth in traditional trades, as we know them, has plateaued, has stayed the same, but demand continues to grow in some of these trades. But as I said before, the supply is not matching the demand. THOMPSON: Here on Radio National, nine to eight. I’m talking to Jim Barron from Group Training Australia, Gillian Shadwick from the TAFE Directors Association and Wilhelm Harnisch who is from the Master Builders Association. Wilhelm … Gillian, you were going to say - or reply, yes? SHADWICK: Yeah. Peter, if you wouldn’t mind, I would like to reply to Wilhelm’s comments in relation to TAFE not being flexible because we do pride ourself on a great deal of delivery flexibility. I’d probably want to make the distinction because it’s often misunderstood that we’re part of a national training system and that the qualifications in fact are designed by the Australian National Training Association with - and they’re industry-led. And all of us would agree that they’re probably slower to develop and accredit than we would want, and we would want flexibility and speed in that as well. But Jim was really referring to delivery. And we do a great deal in TAFE of on-site delivery. We go to workplaces, we assess bricklayers in the workplace, we go to construction sites and so on. But at the end of the day, we are a public provider with a great responsibility to use our funding wisely to give as many places to as many people as possible, not just apprenticeships and traineeships but the eighty per cent of other people in TAFE who aren’t doing those programs. And if we do one on one tuition in a great many workplaces, it reduces significantly the kind of training, the quantity of training we can offer to Australians and we have to balance those things. And sometimes, when people say not flexible enough, they’re meaning they want just in time, just for me, on my workplace, and it’s probably not a reasonable balance to ask of a public system. THOMPSON: Well Wilhelm, we’ll give you a chance to reply to that. But also, I want to raise a bigger question too with you and that is, in the construction industry, it’s a particular example of an industry which is more and more using subcontractors. Subcontractors tend to be small firms that can’t really afford to hire apprentices in the way that big firms traditionally did. HARNISCH: Yes. Could I just perhaps respond to Gillian? I certainly wasn’t making an attack on the TAFEs. I think they are, as I said, doing a very good job. They do have limited monies. But what industry is demanding is that there be greater user choice, the ability to perhaps leverage off the facilities and infrastructure that the TAFEs have provided. These proposals have been put to the TAFEs in terms of providing greater flexibility and greater user choice. In terms of the problems of subcontractors, yes, the subcontracting nature of the building industry does present particular challenges in the area of training. Unfortunately, individual subcontract - THOMPSON: Give us an example of it, if you can, give us a feeling for it? My understanding of the industry was it used to be dominated by large players. Now, there are still large players but they all subcontract in from small firms. And small firms are in an entirely different situation when it comes to hiring young apprentices. HARNISCH: Yes, well … today’s subcontractors are usually one sole trader or a dual partnership between two skilled tradesmen. They simply go from job to job and simply are not able to provide all the necessary infrastructure and training to put on an apprentice. What … the industry’s response has been, certainly in the building industry and Master Builders has been, to put up group training apprenticeships where the MBA, for instance, has fourteen hundred apprentices on its books that it then hires out to employers. So it is a particular problem for this industry. It is a big challenge for us in terms of getting subcontractors to be more aware of their responsibility because if the industry doesn’t take responsibility, the industry cannot complain that it’s facing a skills shortage. THOMPSON: Jim, I think Gillian said earlier that it’s often underestimated how high tech traditional industries are. Give us some sense of that, for example, around information technology and the like. BARRON: Well, information technology, I guess you’ve picked a wrong example from my point of view. I think in the context of, you know, every trade – be it automotive, building, construction, metals, manufacturing – is clearly much more high tech than it was ten, fifteen, twenty years ago. That’s a given. THOMPSON: I know if my car goes in for a service, they start (indistinct) computers, they don’t start tinkering with screwdrivers - BARRON: (indistinct) Bill Gates there looking after your car. That is a given. You know, to me it’s a furphy saying that these trades are somehow in the old economy. Of course, they’re all in the new economy – they’ve just been updated. So every kid who goes into - sorry, every young man or young woman or middle aged man or middle aged woman THOMPSON: Showing your age (laughs). BARRON: … who go into these trades need certain skills. So they have - you know, and IT is one of them, but I’d pick you up on IT. You know, there was this mad rush of excitement five years ago about IT and everybody had to get into training for IT. Sixty, seventy, eighty thousand people went into universities to do IT courses – about eighty percent of those didn’t get a job. THOMPSON: Yes, I wasn’t talking specifically about IT as an end in itself, but IT is part… BARRON: But it certainly… THOMPSON: … of a process. BARRON: … it’s about the attitudinal and cultural issues that we’re dealing with. THOMPSON: So Gillian, how does … how do educators deal with that changing technology? SHADWICK: Well, I mean, TAFE teachers and trainers have to stay very up to date with the technology. A great - one of the reasons we’re able to do this is we have a high percentage of our lecturers and teachers are in fact working in industry still, they are part time, and they bring that up to date industry experience to the classroom, so that that mix of full time and part time, with the part time based in industry, is one of the ways we keep it absolutely up to speed. But we do a lot of training in the workplace. So if, for example, it’s the food processing industry, we will go to a major organisation and do the training with their machines in their own workplace. So it’s all the up to datedness of that workplace site. THOMPSON: Let me move on – we have only got a couple of minutes left – to reforms and changes. There’s been this Senate Committee inquiry which I’ve mentioned, the federal government’s announced changes. Jim, first of all, briefly, what are the changes? What are the substance of the changes and will they work? BARRON: Well, I think it’s too early to say whether they’re going to work or not. The government, as I said before, announced its skills shortage strategy a couple of weeks ago. A great start. There’s no extra money announced in that package but I - we all expect that to follow hopefully in the budget or post … down the election campaign trail. But I think fundamentally, if we are to attack this problem at its core, we need to go back to the schools. If every school in this country embraced school-based apprenticeships, whereby a young student could start an apprenticeship at grade eleven or twelve, stream them into a full time apprenticeship having left school, you would I think in four or five years time fundamentally grab this issue by the scruff of the neck. Unfortunately, many schools and many jurisdictions do not embrace school-based apprenticeships. Related to that is still this idea that the only reason to do twelve years of schooling is to go on to a sandstone university. It’s about attitude, it’s about culture, and I think if we attack those things at its core, we go a long way towards fixing this problem. It doesn’t necessarily mean massive amounts of investment from government. That helps, of course – we’ll never say no to it – but I think it’s about changing attitudes at the school, in the wider community and particularly with business. If we get a training culture, we fix this problem. THOMPSON: And very briefly, Gillian? SHADWICK: I think we - it’s a good start, the government announcements. I’d like to see some more federally funded places and support. I’d like to see the approach to apprenticeships and traineeships reviewed because I think there’s some old-fashionedness built in it. THOMPSON: All right. Now, I must go on to Wilhelm. A final comment from you? HARNISCH: Look, it’s a very good start. I think what the industry really wants is greater flexibility. We have … obviously need to take responsibility. We’re certainly taking our role in promoting the benefits of apprenticeships and traditional trades. THOMPSON: Well, thanks very much to all three of you for coming in this morning. Jim Barron, chief executive of Group Training Australia, Gillian Shadwick, who’s chair of the TAFE Directors Association and also director of the Western Sydney Institute. And Wilhelm Harnisch, who is the chief executive of the Master Builders Association. END OF SEGMENT |
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