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4102.0 - Australian Social Trends, 1998  
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Contents >> Education >> Education At Work: Workplace training

Education At Work: Workplace training

Between 1993 and 1996, employers decreased training expenditure per employee and the number of training hours provided for their employees.

Following expansion in the higher education sector in the late 1980s and early 1990s, Commonwealth Government attention has recently turned to the Vocational Education and Training (VET) sector in order to address a perceived lack of skilled labour in the Australian workforce. This change in focus has also been fuelled by high levels of unemployment, increased competition for jobs, industry restructuring and technological improvements requiring upgrading of workplace skills. These factors have all had an impact on the need and demand for VET.

To guide the direction of growth and change in the VET sector, the Australian National Training Authority (ANTA) was established in 1992 to develop and implement a national vocational education system to strengthen the quality of VET across Australia. ANTA, along with Industry Training Advisory Boards (ITABs) which identify training needs and priorities in each industry, is responsible for defining the financial needs, course design and future requirements in the VET sector.

Traditionally, Technical and Further Education (TAFE) institutions have provided the majority of VET courses. However, the changing nature of the sector has seen an increase in the number of higher education institutions, schools, private organisations and employers providing VET. Employers were further encouraged to provide VET in the workplace by the introduction of the Training Guarantee in 1990. This guarantee required most employers to spend a minimum percentage of their payroll on training their employees (see Australian Social Trends 1995, Employee training). However, its suspension in 1994 and subsequent abolition in 1996 has seen a reduction in workplace training.


Workplace training

Vocational Education and Training (VET) includes all education and training (other than degree courses at higher education institutions), undertaken after compulsory school years are completed, specifically directed towards the acquisition of work-related skills.

Workplace training refers to VET provided by employers for their employees. This includes VET provided under training contracts for apprentices and trainees on entry to the workforce. Workplace training can be either structured or unstructured.

Structured training relates to all training activities that have a predetermined plan and format designed to develop employment-related skills and competencies.

Unstructured training relates to informal training that does not have a specified content or predetermined plan. It is usually conducted on the job and involves activities such as being shown how to do the job, watching others work, reading relevant material and teaching oneself. As unstructured training is difficult to measure and is generally under-reported, most training data in this review relates to structured training only.

Workplace training data is mainly from the 1997 ABS Employer Training Practices Survey (TPS), which collected information on structured and unstructured training for the 12 months ending February 1997, and the ABS Employer Training Expenditure Surveys (TES) conducted in 1993 and 1996. TES collected information on structured training for the three-month period from 1 July to 30 September in each of those years.

Small employers are organisations with 1-19 employees. Medium employers are organisations with 20-99 employees. Large employers are organisations with 100 or more employees.


Training provided by employers
During the 12 months ending February 1997, 61% of all employers provided training for their employees. More employers provided unstructured training (53%) than structured training (35%), with 27% of employers providing both types. Of those who provided structured training, the two most important reasons given for training employees were to improve their current job performance (38%) and to improve the quality of goods and services (37%). Responding to new technology was another important reason given (22%).

Employers spent close to $1.2 billion on structured training over the three months from July to September 1996, an increase from the $1.1 billion spent over the corresponding period in 1993. Much of this increase was due to the inflation of wage and salary costs, which made up 70% of total training expenditure in both years. Moreover, the increase in expenditure did not keep pace with the expansion of the workforce over the period. Consequently, training expenditure per employee decreased from $191 in 1993 to $185 in 1996. Hours of training per employee also decreased, from 5.6 hours to 4.9 hours. These decreases have occurred since the Training Guarantee was suspended and abolished.

Employer size
In the September quarter of 1996, large employers spent more on training per employee ($256) and provided more training hours per employee (6.5 hours) than either small or medium employers. Large employers were also the only organisations to have increased training hours and expenditure per employee between 1993 and 1996. However, as only 2% of all employers are large, these increases were more than offset by decreases in training hours and expenditure per employee by small and medium employers. This drop in commitment to workplace training by small and medium employers accounts for the lower levels of training in 1996.

WORKPLACE TRAINING(a) BY EMPLOYER SIZE

September quarter 1993
September quarter 1996


Hours per employee
Expenditure per employee
Total expenditure
Hours per
employee
Expenditure per employee
Total expenditure
hours
$
$m
hours
$
$m

Small employers
4.1
83
108.3
2.4
71
115.0
Medium employers
5.3
179
176.3
3.8
136
168.4
Large employers
6.2
236
818.1
6.5
256
895.4

All employers
5.6
191
1,102.7
4.9
185
1,178.8

(a) Structured training only.

Source: Employer Training Expenditure, Australia, July-September 1996 (cat. no. 6353.0).


In-house and external training
Structured training provided by employers for their employees can be either in-house or external. In-house training courses are those organised by an employer primarily for their own employees, and are usually conducted by the employer's training staff or training consultants. External training courses are those organised and conducted by outside training or educational institutions, agencies or consultants.

In the September quarter of 1996, 70% of total training expenditure was spent on in-house training ($825 million) and 30% on external training ($354 million). Employees received an average of 3.1 hours of in-house training and 1.8 hours of external training per person over this three-month period. The proportions of training expenditure and training hours per employee for in-house and external training did not change between 1993 and 1996.

In 1996, large employers spent a greater proportion of their total training expenditure on in-house training (74%) than medium (62%) and small employers (51%). This is most likely because in-house training is more economically viable for large organisations.


IN-HOUSE AND EXTERNAL TRAINING(a) EXPENDITURE BY EMPLOYER SIZE, 1996

(a) Structured training only.


Source: Employer Training Expenditure, Australia, July-September 1996 (cat. no. 6353.0).


Training by industry
In the September quarter of 1996, industries with the highest total expenditure on structured training were manufacturing ($161 million), education ($132 million) and property and business services ($128 million). However, the mining industry had by far the largest training expenditure per employee ($896) and provided the highest number of training hours per employee (17.1 hours). Industries with the least number of structured training hours per employee were cultural and recreational services (2.8 hours) and accommodation, cafes and restaurants (2.4 hours) where, because of the lower skill requirement, most training is unstructured and provided on the job. These industries also have large numbers of casual employees (many of whom are women) who consequently tend to receive less training than others.

The overall reduction in workplace training levels between 1993 and 1996 did not occur in all industries. Those that reduced training hours and expenditure per employee were communication services; property and business services; construction; wholesale trade; health and community services; manufacturing; and accommodation, cafes and restaurants. All other industries increased levels of workplace training between 1993 and 1996, with mining having the largest increases in training expenditure per employee (up by $209 per employee) and training hours (up by over 3 hours per employee).

Training by sector
In the September quarter of 1996, total training expenditure in the private sector was $779 million, almost double that in the public sector ($400 million), reflecting the greater proportion (over 75%) of employees in the private sector. However, the public sector spent more on training per employee ($264, compared to the private sector's $161) and provided more training hours per employee (6.3 hours, compared to the private sector's 4.5 hours).

While training hours and training expenditure per employee remained around the same levels, total training expenditure increased in the private sector (up by $125 million) and decreased in the public sector (down by $49 million) between the September quarter 1993 and the September quarter 1996. These changes reflect shifts in employment across the two sectors (see Australian Social Trends 1998, Public sector employment).

WORKPLACE TRAINING(a) BY INDUSTRY AND SECTOR

September quarter 1993
September quarter 1996


Hours per employee
Expenditure per employee
Total expenditure
Hours per employee
Expenditure per employee
Total expenditure
hours
$
$m
hours
$
$m

Mining
13.9
687
55.7
17.1
896
65.3
Manufacturing
6.6
206
184.3
5.4
194
161.4
Electricity, gas and water supply
10.0
383
39.7
10.4
481
25.5
Construction
5.9
135
32.1
4.2
100
28.5
Wholesale trade
4.5
205
74.0
3.5
173
69.7
Retail trade
4.1
74
58.2
3.4
88
78.2
Accommodation, cafes and restaurants
2.9
64
18.5
2.4
55
18.4
Transport and storage
5.7
222
61.8
6.1
251
68.4
Communication services
9.2
452
48.7
6.3
318
41.9
Finance and insurance
6.0
250
75.5
6.2
282
93.5
Property and business services
5.5
226
101.1
4.1
191
128.2
Government administration and defence
6.0
238
93.2
6.0
264
78.6
Education
4.6
180
91.5
5.9
222
131.9
Health and community services
5.1
150
102.2
4.1
130
103.2
Cultural and recreational services
2.8
125
15.5
2.8
103
16.9
Personal and other services
9.2
295
50.7
9.7
299
69.2
All industries
5.6
191
1,102.7
4.9
185
1,178.8
Public sector
6.8
263
448.2
6.3
264
399.6
Private sector
5.0
161
654.5
4.5
161
779.1

a) Structured training only.

Source: Employer Training Expenditure, Australia, July-September 1996 (cat. no. 6353.0).


Entry level training
One important group of employees who receive workplace training are apprentices and trainees. These employees start training contracts on entry to the workforce in order to provide them with relevant qualifications and on-the-job skills.

Taking on apprentices and trainees is a large commitment by an employer, as there is considerable cost involved and an obligation to provide a complete range of work experiences. The Group Training Scheme, which evolved in the 1980s, was introduced to encourage this commitment. Under this scheme, apprentices and trainees are indentured to a single employing body, the Group Training Company (GTC). Organisations that form a GTC share the costs, which are subsidised by government, of employing and training their apprentices and trainees. The apprentices and trainees are placed in each host organisation, usually on a rotation basis, to gain work experience.

The number of apprentices and trainees in the workforce was 175,354 in 1996-97, up from 135,783 in 1994-95, representing a 29% increase over the period. This increase can be almost entirely attributed to the rise in the number of trainees (up by more than 36,000). At the same time, apprentices and trainees employed by the Group Training Scheme increased by 34%, from 17,712 in 1994-95 to 23,676 in 1996-97.1

Increases in apprentice and trainee numbers have resulted in increased amounts of entry level training provided by employers, as seen in the 1997 ABS Employer Training Practices Survey. In the 12 months ending February 1997, 48% of employers with an apprentice or trainee increased their expenditure on structured training and 37% increased levels of unstructured training. By comparison, only 15% of employers without an apprentice or trainee increased their expenditure on structured training and 17% increased levels of unstructured training. Larger increases by employers with an apprentice or trainee reflect their additional training responsibilities.

In 1996-97, a quarter of all apprentices and trainees were employed in the building and vehicle occupations. However, between 1994-95 and 1996-97, the number of apprentices in the building occupational group decreased by 8%.

Most other occupational groups increased apprentice and trainee numbers over this period. There were dramatic rises in some occupations, notably labourers and related workers; salespersons and personal service workers; para-professionals; plant/machinery operators and drivers; and clerks. This was largely a result of the increase (309%) in the number of trainees between 1994-95 and 1996-97, almost all (99%) of whom were in these occupational groups in 1996-97.1

The proportion of female apprentices and trainees has been increasing. Most increases in female numbers have occurred in traineeships, as apprenticeships still remain a male-dominated area. In 1996-97, 22% of all apprentices and trainees were female, up from 17% in 1994-95. Female apprentices and trainees in 1996-97 were concentrated in the hairdressing (90% female), clerks (71% female) and salespersons and personal service workers (58% female) occupations. The occupational groups that were largely male-dominated were metal fitting and machining; other metal; building; and vehicle. Each of these had 2% or less female apprentices or trainees.2

APPRENTICES AND TRAINEES BY OCCUPATION(a) AND SECTOR, 1996-97

Apprentices
Trainees
Total(b)
Change from
1994-95 to 1996-97
no.
no.
no.
%

Building
24,288
-
24,288
-8.1
Vehicle
21,152
-
21,176
7.0
Electrical and electronics
16,703
-
16,778
5.7
Food
16,269
-
17,059
12.8
Metal fitting and machining
10,235
-
11,707
13.0
Hairdressing
9,721
-
9,721
-3.7
Other metal
9,690
-
9,690
4.6
Other trades and related workers
7,558
19
7,617
-1.6
Printing
3,160
-
3,160
0.7
Horticultural
2,948
-
3,196
-6.2
Salespersons and personal service workers
323
16,005
16,769
323.0
Clerks
-
13,851
13,897
124.5
Para-professionals
470
2,688
3,164
318.5
Managers and administrators(c)
521
418
1,974
21.7
Labourers and related workers
-
12,663
12,922
773.7
Plant/machinery operators and drivers
30
2,108
2,235
305.6
Total
123,069
47,756
175,354
29.1
Private sector
n.a.
n.a.
141,019
28.3
Public sector
n.a.
n.a.
10,659
30.1
Group Training Scheme
n.a.
n.a.
23,676
33.7

a) Based on first edition Australian Standard Classification of Occupations - (ASCO). As apprentices are concentrated in the 'Tradespersons' Major Group, this classification has been broken down to lower levels of detail (Minor and Unit Group). Occupations with large numbers of trainees have not been broken down into the lower levels.
(b) Includes a number for unknowns - those who could not be classified as either apprentices or trainees.
(c) Includes a small number of professionals.

Source: National Centre for Vocational Education Research, Australian Training Statistics, Annual 1996/97.

APPRENTICES AND TRAINEES
Source: National Centre for Vocational Education Research, Australian Training Statistics, Annual 1996/97.


Endnotes
1 Australian Committee on Vocational Education and Training Statistics, 1996, Australian Training Statistics, Annual 1994/95, ACVETS, Canberra.

2 National Centre for Vocational Education Research, 1997, Australian Training Statistics, Annual 1996/97, Vol. 3, NCVER, Leabrook, South Australia.



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