Lack of investment behind skills shortage

Lamp, The, Nov, 2007

Lack of investment in vocational education and training (VET) over the past 11 years is the primary cause of the severe skills shortages impacting on the economy, according to the Australian Industry Group.

AIG says Australia will need 270,000 more skilled workers over the next 10 years. Most will have to be trained at TAFE colleges, yet over 300,000 people have been turned away from TAFE courses since 1998.

Australia's skills shortage has become critical across most sectors and nursing is one of the worst affected. Australia faces a potential national shortfall of 40,000 nurses by 2010.

Liberals' record on VET

A booming economy requires planning well in advance to cater for future workforce needs, yet the past 11 years have seen a serious decline in federal government support for education and training.

* The proportion of Australian adults with at least upper secondary education is now below the OECD average.

* Australia ranks near the bottom of the OECD in terms of the annual growth rate of graduates with science and engineering degrees.

* Since 1998, more than 300,000 people have been turned away from TAFE.

* Since 2001, almost 150,000 eligible applicants have been turned away from our universities.

* Since 1995, Australia is the only OECD country to cut public investment in tertiary education. (by 7%). The average increase in public investment by other OECD countries since 1995 was 48%.

Labor plans an 'education revolution'

The Labor Party has flagged that training and education will be a key pillar of their vision, promising what they call an 'education revolution'.

Kevin Rudd said his main aim was to make Australia 'the best educated country, the most skilled economy and the best trained workforce in the world'.

Labor promises to back this up with adequate funding.

* Labor promises an 'education revolution'--a sustained investment in early childhood education, schools, TAFEs, universities and research as well as programs for mature age workers.

* Labor says education needs to be seen as an economic investment and not just social expenditure. It says there is a strong link between investment in education and higher productivity growth.

* Labor says this investment in education is necessary to turn around what it calls Australia's woeful productivity performance, which dropped, relative to the US economy, from 85% to 79% between 1998 and 2005.

Annual average productivity growth:
Australia compared to the OECD average

Changes in pubic expenditure (share of GDP) on tertiary education
institutions 1995 to 2003

OECD Average

Australia           -7
UK                   6
Netherlands          9
Austria             11
Germany             11
italy               18
Denmark             22
Japan               32
Sweden              32
Canada              37
Mexico              49
Slovak Republic     51
Czech Republic      60
Spain               63
USA                 67
Hungry              78
Ireland             99
OECD Average        48

Source: OECD Education at a Glance 2006 Table B2.2

Note: Table made from bar graph.