Josh Williams: Now isn't the time to kick industry out of training

Workplace trainees and apprentices are workers, before they are students, writes Josh Williams. File photo / Supplied

There is a lot that the industry training and apprenticeship (ITO) sector supports about the proposals to reform vocational education.

It describes industry skills bodies resourced to analyse workforce requirements and advise on where investment should go. It promises adherence to industry standards, no matter where vocational training happens. It proposes a new funding system, resourced according to the type of education, rather than the type of provider.

But it also proposes vocational providers be responsible for managing and supporting workplace trainees and apprentices. We see that as a mistake of show-stopping proportions, which runs counter to the overall goal of a more unified and successful vocational system.

ITOs do not oppose this move because our work associated with supporting New Zealand's 146,000 trainees and apprentices occupies 75 per cent of ITO staff and attracts 100 per cent of our government funding. Or because we don't value the role of vocational education providers as a critical part of the system.

We oppose it because education providers are not well placed to administer employment arrangements. Workplace trainees and apprentices are workers, before they are students. They are recruited by their employers. Each of the 25,000 current ITO employers has the largest say in where and how and when and for whom training happens.

Workplace training has to fit around the activity and the schedule of the workplace, or the employer will say "no thank you". The firm will still train its staff, but not for recognised national credentials. That will make our workforce less resilient, less portable, and less able to compete globally.

Allowing ITOs to work with employers over their training arrangements means the standard setting body stays in day-to-day touch with the real needs of real employers. That's a strength of New Zealand's system today. Industry leads the specification of both the what and the how of skills training.

Most critically of all, it puts the incentives in the right place. Employers want their employees off the production line as little as possible and skilled up as quickly as possible. A vocational provider wants a student for as long as possible and for its classrooms and workshops to be as full as possible.

In short, the system needs a check and balance on providers. The reform proposal removes that check and balance – that deliberate tension – which ensures there is a match between what industry wants and the system delivers.

Giving providers responsibility for workplace training, while at the same time undertaking what the Auditor General describes as the largest machinery of government change in recent times, is risky to say the least.

Josh Williams. File photo / Christine McKay

So let's get back to the whole point of a vocational system – education providers and employers contributing to a national effort to grow the skills and productivity of our workforce, each doing the bit they do well.

Let's look at how we develop skills for the future of work. We do not have enough school leavers or university graduates to fill our skills shortages. Infometrics calculates that 80 per cent of the workforce of 2028 is already working today. We need to increase the skills and productivity of the workforce we have, through more workplace training and apprenticeships.

We need to support and reward those good employers in our economy who are investing in their industry at the same time as running their business. We ought to protect their interests and ensure the training support to them and their employees is not disrupted or diminished.

A bit has been made lately on the fact that our ITOs only work with 15 per cent of New Zealand employers. Firstly, some perspective – that 15 per cent is currently training more people than our universities do.

They deliver 57 per cent of all vocational education in New Zealand and qualifying over 50,000 people a year. Each industry qualification cost the taxpayer $3000 compared with $19,000 for a vocational qualification through a polytechnic.

In the UK, 16 per cent of employers offer apprenticeships. 50,000 firms in Switzerland support apprentices for a population of 8.5 million, compared with 25,000 firms here for our population of nearly 5 million. On the most recent OECD Adult Skills Survey, New Zealand ranked first for the proportion of workers who reported getting formal on-job training.

So now is assuredly not the time to pull the pin on our industry-led training and apprenticeship system. New Zealand's strong performance suggests we should be focusing on ways to grow our numbers, and supporting many more New Zealand employers to train as part of the current system.

If we did that, our skills would match the labour market, and our vocational providers would be thronging with people training as part of their employment, rather than training so they can then look for a job.

• Josh Williams is chief executive of the Industry Training Federation