Count-down to skilled-labour crisis

As Australia ages economic growth will depend on higher skilled labour force participation, but this involves a level of investment in education and training which isn’t happening now, with the increase in higher education enrolments not offsetting the decline in VET study since 2012.

“If participation rates in higher education and VET in Australia fall as the population increases, there will be fewer people of prime working age who can effectively participate in the labour market in the future,” Peter Noonan and Sarah Pilcher from Victoria U’s Mitchell Institute warn.

They set out eight scenarios on participation in VET and higher education in a new report, released this morning.

 Scenario one:  enrolment growth held at 18-64 year population growth for2020-31, as per government policy. “It is difficult to see sustainable enrolment growth at marginal rates in the medium-to-longer term.”

Scenario two: growth continues at demand driven system levels. There are 235 000 more students by 2031, because, “the system is able to grow in response to ongoing demand, driven by a range of factors, not just 18 – 64 age population growth.

Scenario three: hard cap on enrolments at 2017 levels.  Participation will fall by 4.3 per cent to 2031, compared to a 6.1 per cent growth under scenario two.

Scenario four: decline in VET enrolments continues: VET enrolments are 243 000 in 2031, down from 841 000 in 2016. This would make VET “a residual sector”.

Scenario five: VET growth restored, adding 150 000 places in 2031.

Scenario six: both VET and higher education follow the total 2016-17 trend, but HE growth is not hard capped. VET decline drags the whole sector down, to 1.39m in 2031, down from the 2012 peak of 1.75m

Scenario seven: higher education is fixed at the population growth cap population and VET follows the 206-16 trend. There are 1.16m students in the post secondary system – well below the 2008 figure as higher education fails to compensate for declining VET participation.

Scenario eight: 2016 participation levels matched. This requires enrolling an extra 760 000 students in 2031.

“The most urgent priority is to address declining levels of public investment in VET and associated cost shifting to students, and other factors that appear to be contributing to the ongoing fall in VET student enrolments. This issue should be considered as a matter of priority by the heads of Australian governments if the real risk of declining participation in tertiary education in Australia, and declining levels of qualification attainment in the workforce, is to be averted,” Noonan and Pilcher warn.


to get daily updates on what's happening in the world of Australian Higher Education