The
average age of New Zealand’s apprentices is 28 years. Just 6% of young New Zealanders go directly into apprenticeships when they leave school.
That is less than a fifth of the percentage going to university. In stark contrast, about half of all German school leavers take up apprenticeships.
It is not necessarily a bad thing for people to get some life experience before they undertake an apprenticeship. Even so, why are more of New Zealand’s school leavers not taking up apprenticeship options, as many young Germans do?
Fundamentally, New Zealand’s apprenticeship system lacks coherence. Its fragmented nature entrenches the low status of apprenticeships relative to university study. It also makes the option of an apprenticeship less visible to young people than it should be.
In Trade Routes, a new report for The New Zealand Initiative, I make recommendations to improve the uptake and quality of apprenticeship training in New Zealand. I drew much inspiration from Germany’s world-renowned “dual-training” system.
The glue that holds the German apprenticeship system together is its chambers of commerce. The chambers administer qualifications, oversee industry standards, and fund training. All companies must belong to a chamber and pay a levy. Levies are mainly used to fund training centres, meaning that training is fees-free for apprentices.
Chambers also make sure apprentices are not exploited and that companies uphold their training obligations. Additionally, they are responsible for resolving disputes between employers and training institutes.
The nearest New Zealand equivalents of German chambers of commerce are workforce development councils (WDCs). But, WDCs do not have nearly the breadth of responsibility or authority of the German chambers. Their main role is in standard setting – that is, overseeing the professional standards for trades in their industry sectors.
WDCs also have a role in endorsing qualifications but they are not ultimately responsible for approving them. That function rests with the New Zealand Qualifications Authority (NZQA). Neither do WDCs administer funding for training institutions, as the German chambers do.
The Government is currently reviewing WDCs, which will be rebranded as industry skills boards (ISBs). The review is a golden opportunity. Given the right policy settings, the new ISBs could greatly enhance New Zealand’s apprenticeship training system. If they are set up well, they will drive improvement in the quality of training and ensure that it focuses on the skills industry needs.
To make ISBs more effective than WDCs have been, they will need expanded roles, akin to those of German chambers of commerce.
A straightforward change would be to grant NZQA’s powers of programme approval and qualifications recognition to ISBs. Currently, providers cannot offer vocational programmes or qualifications unless they have been endorsed by a WDC and approved by NZQA. This is effectively a dua-approval process. It is inefficient.
Evaluating international qualifications for comparability with New Zealand qualifications is another NZQA function that could be delegated to ISBs. NZQA could remain an alternative provider of these services, providing an element of competition.
ISBs should also be given specific responsibility for supporting vocational programme development in secondary schools. That would help schools improve the quality and visibility of those programmes. As a result, it would likely increase the flow of school leavers into apprenticeships.
Taking on these functions would give ISBs the potential to effect positive change in apprenticeship training. But to realise that potential they will need mechanisms to make them accountable to industry.
One factor limiting WDCs’ accountability is that their members are appointed by ministers, not elected by industry. When ISBs replace them, most members should be elected by industry associations. That would provide a clear line of accountability to the businesses represented by the associations.
Industry associations should be empowered to cast a number of votes for ISB members proportional to their share of trainees and apprentices in each industry sector. That would give more say in the running of their ISB to associations representing industry sectors that train large numbers of apprentices.
If ISBs were given responsibility for programme approval, another desirable mechanism for accountability would be mandatory reporting of programme outcomes.
Reporting should include completion rates; proportions of graduates gaining employment relevant to their qualifications; retention of graduates in the relevant industry; and results of employer surveys canvassing satisfaction with the graduates of each programme.
Much needs to be done to establish a coherent, high-quality apprenticeship training system in New Zealand. Trade Routes makes recommendations for secondary programmes, apprentices’ pay, and funding of tertiary training. But getting the reform of ISBs right would provide a firm platform to support further reform.
