Urgent need to upgrade our workforce skills

A renewed focus on lifting our workplace skills is essential to restoring our lagging productivity performance.

PRESSURES on employment and training during the down turn were the focus of a recent joint report by Ai Group and Deloitte.

The report, Skilling Business in Tough Times, tells the story of Australian businesses doing all they can to retain their skilled staff despite tough economic conditions.

While planned cuts to employment and training budgets over the coming year are significant, the survey shows that companies have learnt from past downturns the importance of maintaining skilled workers in antici pation of an upswing in activity.

As a result of this approach, employers are cut ting back but not slashing training budgets as they did in past downturns. They are also putting in place strategies to hold onto staff, including reducing non-labour costs and cutting back hours.

Our research found a third of businesses plan to reduce their training expenditure in 2009-10, and four out of five of those will cut funding quite significantly. The most serious cuts are expected in the con struction (6.6%) and manu facturing (5.4%) sectors.

These industries will also be impacted by an anticipated reduction in apprentices dur ing 2009-10. More than a third of companies employing apprentices expect to reduce the number of apprentices in training, which is an overall drop of 5.9%. The intake of new apprentices in 2009-10 is forecast to fall 10.6%.

This decline will undoubted ly contribute to further skills shortages down the track and on our ability to deliver on major infrastructure projects.

According to companies surveyed, ongoing skills short ages are expected particularly among technicians and trade workers (28.1% of compa nies) and engineers (15.3% of companies).

For some time Ai Group has been seeking action to place a floor under the pressure on apprenticeship commence ments and it was therefore welcome to see the action by the Federal Government recently provide further incen tives to employers.

The allocation of $100m from the Jobs Fund to the apprentice Kickstart program will support the employment of more than 20,000 new apprentices.

The increase to the employ er incentives up to $7,350 will be a major boost to the confi dence and capacity of employ ers to take on young people. The additional support will be available for three months from December.

It is essential that we ensure the on-going supply of skilled tradespeople, particularly to support Australia’s major infrastructure investment, while simultaneously giving young people meaningful employment and opportunity

Ai Group is assisting member companies wanting to access the Apprentice Kickstart funding.

The additional support is timely, but it is highly likely that more will be needed down the track.

In terms of what more can be done, Ai Group has piloted an innovative approach to building skills for major infra structure projects.

Under this approach our group training company places apprentices in their early years of training with local compa nies who provide the on-the- job training component.

When the work of the major project commences the apprentices are placed on the project.

The model has proved popular and should be expanded to build the skills pool now.