CHRIS BOWEN MP, MINISTER FOR TERTIARY EDUCATION, SKILLS, SCIENCE AND RESEARCH, MINISTER FOR SMALL BUSINESS
RELEASE OF THE AUSTRALIAN WORKFORCE AND PRODUCTIVITY AGENCY’S NATIONAL WORKFORCE DEVELOPMENT STRATEGY 2013
UNIVERSITY OF WESTERN SYDNEY, PARRAMATTA
8 MARCH 2013
First and foremost, I thank AWPA for presenting to me its second National Workforce Development Strategy, Future Focus.
This is a balanced, thoughtful report that sets out a pathway for Australia’s workforce through to 2025. It provides important industry feedback on how the Government can build on our already substantial investment in skills and workforce development.
The report will be an important input into the Government’s policy deliberations as we look to the future.
Across the world, advanced economies are wrestling with the question of what the future holds. Many have tepid growth rates and little room to move to address these through fiscal and monetary policy.
And of course, the distinguished economic historian Robert Gordon has pointedly asked whether we can continue to assume that the rate of growth we experienced in the 20th Century will continue in this one. If it is to do so, from where will it come? The smart money is on skills and innovation.
The challenges we face are very different to the rest of the world. Half of the world's advanced nations are still in recession, and governments are grappling with how to repair their balance sheets while there is still a need for stimulus. All while interest rates are as low as they can possibly go.
Skills, especially trade, technical, professional and advanced skills, are the bedrock of innovative workplaces.
The fact that we have enjoyed two decades of continuous growth and avoided going into recession during the global financial crisis, does not mean we don't need to worry about these things.
We are already encountering the headwinds of an ageing population as baby boomers continue to move into retirement. At the same time, Australia’s terms of trade will almost inevitably continue to come down off its peak. Both of these factors mean we need to keep working to improve our productivity growth, which will be key to driving growth in living standards going forward.
So there can be no taking our foot off the accelerator. We must take measures to boost productivity growth on a sustained basis – and we are.
Last month the Government released its Plan for Australian Jobs, a $1 billion investment in the economy of the future. It recognises that innovation is a key driver of productivity.
Under the Plan, the Industrial Transformation Research Program will embed PhD students inside companies to solve problems and develop new products and processes, all the while producing our next generation of advanced scientists, engineers and IT specialists.
Investing in skills is how we will stay ahead and position ourselves to best adapt and grow in the rapidly changing, globalised future outlined in AWPA’s report.
This is not just a matter of increasing the proportion of young people attaining tertiary qualifications. We have clear targets and plans around these already.
The AWPA strategy shows that our investment in skills must build on these plans. To meet the work demands of the future, we need to both deepen and broaden our skills base across all industries and jobs.
Employees with advanced skills and capabilities improve workplace productivity. They are able to spot opportunities for improvement and accelerate the rate of innovation and the adoption of technology.
Up-skilling supports industrial transformation, allowing firms to move into higher value-added activities and global value chains.
It also of course makes for better productivity and more satisfied workers. I recently visited Doric a hardware manufacturing firm in my electorate – a family firm very serious about training. To hear shop floor workers talking about their ideas to lift productivity, to hear them talk of spaghetti maps and value chains, and to hear their passion as they did was a good reminder for me as to the value of investment in training to individuals.
This is why the Australian Government has skills and innovation among the five key policy pillars underpinning our reform agenda. And it is why the work entrusted to AWPA is a key part of the Government’s productivity agenda.
Today’s report rightly identifies the need to ensure Australia has the right skills in the right place at the right time if we’re to maximise productivity and innovation.
But, crucially, we will also need to make sure individuals, enterprises and industries alike are using those skills to their full advantage.
The National Workforce Development Strategy addresses both sides of the skills equation:
• how to encourage individuals to invest in education and skills for their own benefit, and;
• how to encourage employers to make the best use of those skills and extend them even further.
These two parts together create the cornerstone of higher workplace productivity, even if they are not always straightforward to address.
But the strategy suggests ways to tackle them and lift performance through workforce development.
For example, AWPA recommends greater alignment between government programs that support business improvement, like Enterprise Connect, and those that support workforce development, like Skills Connect.
It ought to be the case that an employer seeking advice on how to grow their business should encounter no wrong door whichever of these programs they first approach. We have already made significant progress in this area.
Skills Connect is providing an integrated approach to linking eligible businesses with a range of skills and workforce development programs and funding, rather than expecting companies to navigate a range of individual programs just to meet the skills needs of their workforce.
AWPA’s strategy also recommends widening the scope of firms eligible for assistance through Enterprise Connect. I am pleased to say we have done just that in the Plan for Australian Jobs.
You are doing pretty well when you have one of your recommendations adopted before your report is released.
Assistance will now be extended to SMEs in three more industries: professional services; information and communication technologies; and transport and logistics.
The strategy recognises the critical role of foundation skills in building the flexible workforce we need to meet the demands of the Asian Century.
Of course, to support adult Australians who need to update their skills to help them find work and build a career. These skills often include language, reading and numeracy as almost all jobs today involve inter-personal communication and engaging with complex text such as health and safety instructions.
The Australian Government has maintained a strong focus on our foundation skills programs like the Language Literacy and Numeracy Program. In the last three years key foundation skills programs have assisted more than 81,000 job seekers and employees to improve their LLN skills.
We’ve also worked extensively with industry, through the Industry Skills Councils and the Australian Industry Group, to build employer engagement with foundation skills as a workforce development issue.
AWPA also turns the spotlight on apprenticeships, which for the better part of our history have been the way skills are deepened and refined in a work setting.
Our apprenticeship system has served our country well and is the envy of the world. Developing countries come to study our model to discover how to target their training.
We have successfully expanded the model to include traineeships in the services sector. This has helped to develop productive capacity in new areas of the economy.
Importantly, over the past two years the Australian Government has been working closely with state and territory governments to develop nationally consistent conditions for apprenticeships and traineeships.
This alignment will ensure national employers such as the large supermarket chains will be able to move their apprentice butchers and bakers seamlessly across state borders without disrupting their training.
I plan to ask my fellow skills ministers at the next meeting of the ministerial council to agree to implement these national positions.
In an economy where more workers are mobile, this removes another barrier to increased productivity and makes it easier for employers to train their workers.
So there is already much in our reforms to address many of the issues AWPA has raised, but I also look forward to working with AWPA and other stakeholders on areas where we can do better.
For Australia to remain competitive in the 21st Century, we will need to be persistent in our efforts to secure higher productivity. It is, in many ways, an ever receding finish line – there will always be more to do.
And this can only come about if we invest money, effort and time in the higher skills and qualifications that our workforce and our economy need.
The Government has already taken big strides in this direction to make sure Australian workers and professionals are skilled and reskilled for the economy.
The 2013 National Workforce Development Strategy will be a valuable addition to our efforts in taking that momentum forward.
On that note, it’s my great pleasure to accept the strategy report from AWPA.