With most things in life, you only get out what you put in. Covid19 put a pause on immigration, and it shone a light on Australia’s skills shortages. One of the lasting benefits from Covid will be that businesses have stepped up to the challenge, with Apprenticeships increasing 30% in the past year. Finding and training talent is important, yet only a paltry 56.1% complete their apprenticeship. So when addressing our skills shortages through Apprenticeship programs, what works, and what doesn’t?
Apprentices and trainees account for just 2.2% of Australia’s total workers, but account for a very high 11% of all workers in trade occupations. 217,000 people are currently undertaking apprenticeships, eclipsing the previous peak from the 2012 mining boom. It’s really important to reflect on that every Apprentice position is actually a real job, that is, a job in their chosen career path. By comparison, many University degrees are undertaken in the hope of getting a job, with a very high portion not gaining employment within their field upon completion. (A topic for another day).
The reason for the boom in training is two-fold:
- When qualified candidates dried up, businesses were woken from their slumber by a very shallow talent pool, and started to take on the responsibility of actually training their own workforces,
- Government will claim credit because they boosted financial incentives for employers to take on Apprentices (covering 50% of the apprentice wage costs for the first year, capped at $7,000 per quarter). Incentives of 10% for 2nd year and 5% for 3rd year have been implemented as an incentive to retain apprentices in an attempt to achieve higher completion rates.
Never has RD Williams employed an Apprentice based on receiving any kind of subsidy. Whilst these amounts might sound impressive, employing anybody based purely on “free money” will cost you money. The cost of a misaligned (or dud) employee far exceeds the handout. Our company mainly trains Diesel fitters, so I’ll give examples around that trade. Just one missed o-ring or incorrect tightening procedure in a component rebuild will make the subsidy seem like chump change.
Our Apprenticeship completion rate has been just shy of 100%. Not to jinx ourselves, but this “luck” can be achieved by following some simple concepts:
Candidate selection: I think this is where many companies go wrong, it’s vital to get a person with the right fit for the career. We have never advertised for an apprentice. Our spots have been filled with known quantities with the right attitude, either keen work experience students or established employees seeking to develop themselves. Apart from having seen and experienced what they are going into as a career path, they also need to demonstrate an interest in their occupation. We frequently get calls from enthusiastic applicants, many of them openly saying that they want to gain an apprenticeship to go and chase the money in the mines. We explain that by the time they complete their 4 years, the boom cycle will have turned, so they need to choose their career because they have a passion for it. They need to approach an apprenticeship as an 8 year employment contract: 4 years of qualification, then 2 years of actually learning without anyone holding the hand, followed by 2 years of becoming good at your qualification.
Training: the days of seeing Apprentices as a cheap source of labour disappeared many years ago. As an employer, it is our role to provide training by experienced, efficient and supportive trainers. The key is to give exposure to a wide range of skills and knowledge. We also make sure that all our apprentices have completed hands on experience of everything before they attend the respective theory training. And we never set an expectation of early sign offs in an attempt to boost our qualified labour pool before they are ready, however much the training organisations push for it. Apprentices that have been valued and given a broad exposure (which takes time) during their training years are much more likely to remain with their employer at completion.
How can the system be improved? It is very telling that if you google Apprenticeship, most results talk about financial incentive programs. There is not much information for employers or employees on why or how to become good Apprentices and trainers.
- Be “adult like” – The first year in the workplace is not about sweeping a floor. The same should apply to the theory content. Just take a look at some of the “Core” subjects – Work with others, Plan to undertake a routine task, Participate in environmentally sustainable work practices, Organise and communicate information, Plan a complete activity. There are more, but really??? The curriculum needs to be updated to reflect that students aren’t dummies.
- Remove fast tracking of qualifications. Training organisations get financial benefits by churning through modules and completions as quickly as possible, which is a fault in the system leading to a focus on quantity over quality.
- There are subjects, particularly around diagnostics and working with emerging technologies, that need to be added. If any trade qualification doesn’t need the full 4 years, change the duration instead.
- Remove sign up incentives. This might be somewhat controversial, but whilst some training organisations might have this as their business model, employers that actually provide on the ground training don’t. If Government really feels a need to pump more money into the system, tip the programs upside down and pay the money at the completion of the qualification to the apprentice (not to the employer) as a reward for achievement rather than an inducement at the start that seems to fail in that nearly half of all commencements don’t complete.
Why is an Apprenticeship a good career path?
- You earn money while you are learning. Maybe not a lot at first, but compared to for instance University, every dollar you earn kicks into your life earnings. At the end of your certificate, you aren’t starting from the bottom of the ladder and can climb fairly quickly if you have talent and skills.
- Little or no debt from your education.
- You are learning workplace etiquette and expectations, basically what it is like to be in the workforce. At the end of your qualification, you are already with an employer within your field that can probably continue your employment without having to compete with hundreds of candidates.
It is pleasing to see the renewed enthusiasm in developing our work forces, even if it took closing the borders for a couple of years to get the message. Let’s hope it’s a lasting lesson to students, employers and Government alike.
In closing, this is the last newsletter edition this year. Wishing you and your family a restful Christmas to recharge for another great New Year! Thank you for your ongoing support.
As always, onwards and upwards!