Clearing the Myths Away: Higher Education’s Place in Meeting Workforce Demands

By Bob Birrell and Virginia Rapson

Australia is the beneficiary of great economic times. But is this delivering the education and training dividend that the country needs? Recent Australian Government higher education and training policy has been misguided, having apparently fallen for several popular myths.

Myth 1: There has been too much emphasis on university education

Myth 2: There is inherent conflict between expanding trade training and maintaining or increasing university education

Myth 3: In future years there will be declining numbers of young people entering the workforce.

Each of these is wrong.

Myth 1: Too much emphasis is placed on university education

The fastest growing areas of the workforce are in managerial, professional and associate professional occupations, most of which rely on workers with knowledge and skills derived from tertiary qualifications. However over the period 1996 to 2005 there has only been a marginal increase in university commencements by domestic students. During the Coalition's decade in office the potential of the higher education sector to contribute to Australia's workforce demands appears to have been neglected. There has been plenty of sectoral reform to universities but little improvement in access or opportunity.

Myth 2: A choice must be made between trade training and university education

Training at the higher education and trade level should not be seen in opposition. We can and should be expanding participation in both. There are far too many young Australians ill equipped to provide the skills needed in a labour market where most of the growth is in jobs requiring technical, analytical and managerial skills. In 2005, 46 percent of school-leavers were not enrolled in any post-school education. There were large numbers of young adults not working or studying full-time: 21 percent of 20 year-old men and 33 percent of 20 year-old women, for example.

Myth 3: There will be declining numbers of young people entering the workforce

Australia is not running out of young people. The total labour force will increase from an estimated 10.54m in 2006 to an estimated 13.61m in 2051, mainly due to migration. Despite this, the annual rate of growth of the labour force is estimated to fall from about 1.6 percent currently to less than half this rate by 2051. This is largely because of the waves of baby boomer retirements due to occur in coming years. The number of 15-19 year olds will increase from an estimated 1.4m in 2006 to an estimated 1.58m in 2051. National wealth will rely on productivity growth and increasing the skills of the Australian workforce. Migration and re-skilling of older workers are valid policy choices to help address this. However skilling young Australians offers both the greatest potential source of additional skilled workers, and is the most efficient and productive policy approach.

Australia's future prospects will depend on the near universal engagement of young Australians in education and training. Not coercively but in ways that:

sharply increase the number of funded university places for domestic students

improve accessibility to university campuses

offer financial support for students from families of modest income.

There is plenty of scope to increase the proportion of young people studying in both the higher education and vocational training sectors, and to do so on the basis of well-informed policy rather than myths. Policies that prioritise access and opportunity for young people are the keys to boosting participation and productivity over the longer-term.