My Blog

Tag: Industry & Sector Policies

  • Rebuilding Vocational Training in Australia

    Ironically, the manufacturing recovery could be short-circuited by looming shortages of appropriately skilled workers. This seems unbelievable — given so much downsizing in manufacturing employment that occurred between 2001 and 2015. But a combination of structural change within the sector, the ageing of the current workforce, and the failure of Australia’s vocational education system (crippled by a bizarre experiment in publicly-subsidized private delivery) means that recovering manufacturers may be unable to find the skilled workers they need.

    A recent feature article in Australian Welding magazine highlighted the Centre for Future Work’s research into the problems of the current VET system, the implications for manufacturing, and 12 key reforms urgently needed to repair the situation.

    The feature article is extracted from a detailed paper (co-authored by Tanya Carney and Jim Stanford) on the evolving skills requirements of the manufacturing sector, and the failure of a privatised, fragmented VET system to meet those needs. That paper was unveiled at the 2018 National Manufacturing Summit in Canberra.

    “Stable, well-funded, high-quality public institutions must be the anchors of any successful VET system. Public institutions are the only ones with the resources, the connections, and the stability to provide manufacturers with a steady supply of world-class skilled workers.”

    Please see the full 4-page article in Australian Welding magazine with our proposals for rebuilding a high-quality, modern VET system to meet the needs of manufacturing and other Australian industries.

    We are grateful to Australian Welding and Weld Australia for permission to reprint this article!

    The post Rebuilding Vocational Training in Australia appeared first on The Australia Institute's Centre for Future Work.

  • Manufacturing Rebound Could Be Cut Short By Skills Shortage

    The new report from the Centre for Future Work identifies key factors behind the rapid emergence of skills shortages in manufacturing, including:

    • The sector’s ageing workforce, creating a looming demographic transition for skilled worker
    • The highly specific nature of manufacturing skills (across sectors and occupations), creating difficulty for workers moving from between shrinking sectors to growing sectors
    • The need for new skills and ongoing training as companies adopt advanced manufacturing techniques and new digital technologies.

    “Manufacturing is again making a positive contribution to Australia’s economic progress after over a decade of decline. We don’t want to squander this potential,” said Dr. Jim Stanford, Director of the Centre for Future Work.

    “If Australia doesn’t get its act together on vocational training, this will be a wasted opportunity for manufacturing.

    “Recent experiments with market-based vocational training have been a waste, they have damaged confidence in the skills system among both potential students and employers.

    “Stable, well-funded, high-quality public institutions must be the anchors of any successful VET system.

    “Public institutions are the only ones with the resources, the connections, and the stability to provide manufacturers with a steady supply of world-class skilled workers.

    “No sector feels the pain of the failure of vocational training more than manufacturing, precisely because advanced skills are so essential for the success of advanced manufacturing techniques.

    “Manufacturing stakeholders need to work together to strengthen vocational education and training.”

    Key principles for rebuilding vocational education in manufacturing, discussed in the report, include:

    • A greater reliance on courses and apprenticeships through public-sector TAFE (rather than private providers)
    • Phased-in retirement programs to allow senior workers to pass on their skills to new apprentices
    • Inclusion of provisions guaranteeing access to further training in industry awards and enterprise agreements.

    The report was co-authored by Dr. Jim Stanford and Dr. Tanya Carney and prepared for the Second Annual National Manufacturing Summit at Parliament House on 26 June 2018.

    The National Manufacturing Summit engages leading representatives from all parts of Australian manufacturing: businesses, peak bodies, unions, universities, the financial sector, suppliers and government. The growing problem of skills shortages is a priority focus for this year’s Summit.

    The post Manufacturing Rebound Could Be Cut Short By Skills Shortage appeared first on The Australia Institute's Centre for Future Work.

  • Advanced Skills for Advanced Manufacturing

    Australia’s manufacturing industry is at a crossroads. After years of decline, the sector has finally found a more stable economic footing, and many indicators point to an expansion in domestic manufacturing in the coming years. Manufacturing added almost 50,000 new jobs in the last year – making it one of the most important sources of new work in the whole economy.

    However, one key factor that could hold back that continuing recovery is the inability of Australia’s present vocational education and training system, damaged by years of underfunding and failed policy experimentation, to meet the needs of manufacturing for highly-skilled workers. The skills challenge facing manufacturing is all the more acute because of the transformation of the sector toward more specialised and disaggregated advanced manufacturing processes. This naturally implies greater demand for highly-trained workers, in all its occupations: production workers, licensed trades, technology specialists, and managers.

    To sustain the emerging turnaround in manufacturing, the sector has an urgent need for a concerted and cooperative effort to strengthen vocational education and training. This report contributes to that process: by cataloguing the emerging skills challenges facing manufacturing, reviewing the failures of the existing approach to vocational education in this sector (and across Australia’s economy as a whole), and proposing twelve key principles for reform.

    This report, by Dr. Tanya Carney and Dr. Jim Stanford, was prepared by the Centre for Future Work for the Second Annual National Manufacturing Summit. The Summit, held at Parliament House on 26 June 2018, will gather leading representatives from all major stakeholders in Australia’s manufacturing sector: business, unions, universities, the financial sector, suppliers and government. They will consider the industry’s prospects and identify promising, pragmatic policy measures to support a sustained industrial turnaround. It is a highly appropriate forum at which to begin a discussion about multi-partite efforts to rebuild vocational education and address the looming skills challenges facing manufacturing.

    The post Advanced Skills for Advanced Manufacturing appeared first on The Australia Institute's Centre for Future Work.

  • Dogged manufacturing sector quietly adds 40,000 jobs

    The report, A Moment of Opportunity (download full report pdf below), identifies several indicators which suggest that the economic opportunities for domestic manufacturing have improved significantly.

    The Centre for Future Work in The Australia Institute will host the National Manufacturing Summit: From Opportunity to Action at Parliament House on Wednesday 21 June 2017. Speakers will include a wide range of experts from industry, university, trade union, and financial sectors, as well as four top political spokespersons: Minister for Industry Senator Arthur Sinodinos, Shadow Minister for Industry Senator Kim Carr, Greens Industry spokesperson Senator Lee Rhiannon, and NXT leader Senator Nick Xenophon.

    “Australia’s manufacturing industry faces some daunting domestic and global challenges. But it’s not just surviving, it’s finding a way to grow, adding 40,000 new jobs last year,” Director of the Centre for Future Work, Dr Jim Stanford said.

    “That ranks manufacturing as the second biggest source of new jobs in Australia last year.”

    “Additionally, manufacturing re-invests 5% of its value added in R&D, the highest of any industry, making it an engine room for innovation in the economy.”

    New polling released as part of the report shows that Australians are very supportive of pro-active, targeted policy measures to sustain and support manufacturing (see polling results below).

    “Perhaps influenced by the negative tone of much recent commentary, Australians consistently underestimate the size of manufacturing in Australia’s economy, relative to other industries, but nonetheless recognise the value of maintaining a strong manufacturing sector.

    Specifically, there was strong support for targeted policies such as government procurement mandates (81%) and tax incentives tied to investments in domestic facilities (79%); support was strong across all age and voting groups. Australians opposed measures to attract industry by cutting wages, environmental standards, or across-the-board taxes. But measures focused on manufacturing, tied to Australian production and jobs, received overwhelming support – by a margin of up to five-to-one.

    “Both economically and politically, the smart move would be for legislators to get behind local manufacturing with targeted policies to support Australian jobs, ” Stanford said.

    The post Dogged manufacturing sector quietly adds 40,000 jobs appeared first on The Australia Institute's Centre for Future Work.

  • Manufacturing: A Moment of Opportunity

    In conjunction with the National Manufacturing Summit, titled “From Opportunity to Action,” at Parliament House in Canberra on June 21, 2017, the Centre for Future Work has released a new research paper on the opportunities to sustain and expand manufacturing jobs in Australia.

    Our new report, Manufacturing: A Moment of Opportunity, by Jim Stanford and Tom Swann, challenges the general tone of pessimism which accompanies many discussions about manufacturing in Australia. Manufacturing has survived a brutal decade of global and domestic challenges. It’s still here, it’s still one of Australia’s largest employers, and it still makes a disproportionate and strategic contribution to overall national prosperity. Even more interesting, there are some intriguing signs that manufacturing might be turning a corner.

    The paper also presents new public opinion research showing that Australians continue to express strong support for manufacturing and its role in the economy. Australians consistently underestimate the size and performance of manufacturing — perhaps influenced by the negative tone of much reporting of the sector. But they deeply value its importance as a source of good jobs, exports, and national prosperity. And they will support — by margins of five-to-one — targeted policies to help manufacturing succeed here.

    The post Manufacturing: A Moment of Opportunity appeared first on The Australia Institute's Centre for Future Work.

  • Manufacturing (Still) Matters

    The problems in Australia’s manufacturing sector are well-known, and many Australians have concluded that the decline in manufacturing is inevitable and universal: that high-wage countries like Australia must accept the loss of manufacturing as an economic reality. But international statistics disprove this pessimism. Worldwide, manufacturing is growing, not shrinking, including in many advanced high-wage countries.

    Australians are purchasing more manufactured products, not less. Manufacturing is not an “old” industry: it is in fact the most innovation-intensive sector of the entire economy, generating better-than-average productivity growth, good jobs, and exports. Most importantly, manufacturing possesses several key structural features that make it vital to the economic success of any economy – including Australia’s. This study documents the damaging decline of Australian manufacturing, a decline that has accelerated in recent years. It explains the unique features of manufacturing (including innovation-intensity, productivity, income-generating capacity, export-orientation, and complex supply chains) that endow it with a national economic importance. It shows that Australia has done much worse than other high-wage countries (even smaller more remote ones) at maintaining manufacturing: in fact, manufacturing employment is now smaller as a share of total employment in Australia than in any other advanced country (even Luxembourg!).

    The paper lists ten key policy levers that have been invoked in other countries to support manufacturing – and which could play a positive role here, too, so long as government gives the sector the attention and priority it needs to succeed. The paper concludes with public opinion research showing that Australians agree, by very large majorities, that manufacturing is crucial to the national economy, supports good jobs and high living standards, and should be a national priority for policy-makers.

    The post Manufacturing (Still) Matters appeared first on The Australia Institute's Centre for Future Work.