2012 ITAB Market
Effectiveness Report
Higher Education and Skills Group
Department of Education and Early Childhood
Development
30 March 2012
2012 ITAB Market Effectiveness Report
Contents
Glossary ...........................................................................................................................................i
Executive Summary .........................................................................................................................i
1
Introduction ...................................................................................................................... 10
2
Industry employment forecasts ........................................................................................ 12
3
Overview of market effectiveness .................................................................................... 15
4
Automotive ....................................................................................................................... 17
5
Building and Construction................................................................................................. 23
6
Business Services .............................................................................................................. 32
7
Community Services and Health ....................................................................................... 40
8
Culture and Recreation ..................................................................................................... 46
9
Electro-technology and Communications......................................................................... 52
10
Food Processing ................................................................................................................ 60
11
Forestry ............................................................................................................................. 66
12
Furnishing.......................................................................................................................... 72
13
Manufacturing and Engineering ....................................................................................... 79
14
Primary Industries ............................................................................................................. 87
15
Racing ................................................................................................................................ 94
16
Services ............................................................................................................................. 99
17
Textiles, Clothing, Footwear and Leather ....................................................................... 107
18
Transport and Storage .................................................................................................... 114
19
Water .............................................................................................................................. 120
Appendix A : Industry concordance .......................................................................................... 124
Appendix B : Industry consultation ........................................................................................... 129
Appendix C : Australian Apprenticeships – National Skills Needs List, January 2010 ............... 130
Limitation of our work................................................................................................................... 131
Liability limited by a scheme approved under Professional Standards Legislation.
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee, and its network
of member firms, each of which is a legally separate and independent entity.
Please see www.deloitte.com/au/about for a detailed description of the legal structure of Deloitte Touche Tohmatsu Limited and
its member firms.
© 2012 Deloitte Access Economics Pty Ltd
Charts
Chart 2.1 : Industry employment growth in Victoria – 2012 (ITAB structure) ............................ 14
Chart 4.1 : Employment outlook – Victorian automotive industry ............................................. 20
Chart 4.2 : Skilled Vacancy Index – Victorian automotive industry ............................................ 20
Chart 5.1 : Employment outlook – Victorian building and construction industry ...................... 28
Chart 5.2 : Skilled Vacancy Index – Victorian building and construction industry ...................... 28
Chart 6.1 : Employment outlook – Victorian business services industry .................................... 36
Chart 6.2 : Skilled Vacancy Index – Victorian business services industry ................................... 37
Chart 9.1 : Employment outlook – Victorian electro-technology and communications industry .... 56
Chart 9.2 : Skilled Vacancy Index – Victorian electro-technology and communications industry .... 57
Chart 11.1 : Employment outlook – Victorian forestry industry ................................................. 68
Chart 12.1 : Employment outlook – Victorian furnishing industry ............................................. 75
Chart 12.2 : Skilled Vacancy Index – Victorian furnishing industry ............................................. 75
Chart 13.1 : Employment outlook – Victorian manufacturing and engineering industry........... 83
Chart 13.2 : Skilled Vacancy Index – Victorian manufacturing and engineering industry .......... 84
Chart 14.1 : Employment outlook – Victorian primary industry ................................................. 90
Chart 15.1 : Employment outlook – Victorian racing industry.................................................... 97
Chart 17.1 : Employment outlook – Victorian textile, clothing and footwear industry ............ 111
Chart 19.1 : Employment outlook – Victorian water industry .................................................. 122
Tables
Table 2.1 : Annual industry employment growth – Victoria (ANZSIC industry structure) .......... 13
Table 2.2 : Annual industry employment growth – Victoria (ITAB industry structure) .............. 14
Table A.1 : Concordance between ITAB industry structure and ABS ANZSIC classification...... 124
Deloitte Access Economics
2012 ITAB Market Effectiveness Report
Glossary
ABBTF
ABS
ACCV
ANZSCO
ANZSIC
ATV
BICCIAB
BSV
CBC
CS&H ITB
DEEWR
DHS
EPIC
ESI
ITAB
FurnITAC
MESAB
NBN
nec
OH&S
PICAC
PSV
R&D
RMIT
RPL
RTO
SSV
TCF
TCFUA
TDT
TFIA
VCEC
VET
VFITB
VFITAB
VTG
Australian Brick and Blocklaying Training Fund
Australian Bureau of Statistics
Aged and Community Care Victoria
Australian and New Zealand Standard Classification of Occupations
Australian and New Zealand Standard Industry Classification
Automotive Training Victoria
Building Industry Consultative Council Industry Advisory Body
Business Skills Victoria
Competency Based Completions
Community Services and Health Industry Training Board
Department of Education, Employment and Workplace Relations
Department of Human Services (Victoria)
Elecro-tech., electricity supply, IT, communications and printing
Electrical Supply Industry
Industry Training Advisory Body
Furnishing Industry Training Advisory Committee
Manufacturing and Engineering Skills Advisory Board
National Broadband Network
Not elsewhere classified
Occupational health and safety
Plumbing Industry Climate Action Centre
Primary Skills Victoria
Research and development
Royal Melbourne Institute of TAFE
Recognition of prior learning
Registered training organisation
Service Skills Victoria
Textile, clothing and footwear
Textile Clothing & Footwear Union of Australia
Transport and Distribution Industry Training Board
Council of Textile & Fashion Industries of Australia
Victorian Competition and Efficiency Commission
Vocational Education and Training
Victorian Food Industry Training Board
Victorian Forest and Forest Products Industry Training Advisory Board
Victorian Training Guarantee
Executive Summary
The Higher Education and Skills Group (formerly Skills Victoria), commissioned Deloitte
Access Economics to work with Victorian Industry Training Advisory Bodies (ITABs) to
produce the 2012 ITAB Market Effectiveness Report. The Market Effectiveness Report
expands on the Industry Skill Needs Reports produced for the Higher Education and Skills
Group in recent years by also incorporating ITAB intelligence on training market
effectiveness, including identified market successes and failures.
The purpose of the Market Effectiveness Report is to present an overview of skill needs in
the Victorian economy, including analysis of occupations in demand and experiencing
critical skill shortages, and to provide a summary of market effectiveness in the Victorian
market for vocational education and training. The report is designed to assist the Higher
Education and Skills Group in assessing the performance of the training market, providing
industry intelligence to individuals and businesses, and stimulating training demand in skill
shortage areas.
This report incorporates Deloitte Access Economics’ views, along with a summary of
industry intelligence gathered from the 16 Victorian ITABs. The ITAB advice was provided
to Deloitte Access Economics during meetings and through other correspondence in late
2011 and early 2012. The industry advice presented in this report has also been informed
by consultations held with representatives of various Victorian government agencies.
Examples of market success
In the main, examples of market success nominated by ITABs focused on the identification
and closing of a gap in the training market. In many instances, this was achieved by
mobilising a suitable training provider or actively encouraging industry participation in the
training market.
The examples highlight the capacity to stimulate training demand and develop and tailor
new training packages aimed at a specific training need. Many of the examples relate to
the activities of individual ITABs. However there are also cases of industry-led responses to
training provision and instances where additional government funding has assisted to meet
skill needs.
Examples of market failure
The impact of thin markets was raised as a market failure by a number of ITABs. The issue
results when demand for a training course is insufficient for training providers to offer it, a
situation most prevalent in regional areas (often served by a single training provider).
Although the issue appears well understood throughout the training system, a universal
solution is not apparent (and may not exist). The problem of thin markets has been
overcome in some specific instances through more flexible training delivery and greater
cooperation between industry and providers.
A further example of market failure involves training providers (particularly those which are
publicly funded) not keeping up with technological changes in the industry. This issue
arises because of the pace with which technology changes and the cost of purchasing and
maintaining specific equipment, and can result in outdated or irrelevant training and the
stifling of skill acquisition. There have been some examples of training providers
Deloitte Access Economics
i
collaborating with industry more effectively in order to access the latest equipment and
provide training which is as relevant as possible.
Related to this, it was reported that employers across a number of industries have been
unsatisfied with the quality of graduating students. A common complaint is that students
are not ‘work ready’, generating a loss of confidence in the training system among some
employers.
Key supply side issues
Key supply side issues affecting a range of industries include the following:
 The ageing of Australia’s population is a key concern across a number of industries,
particularly those with an older workforce demographic such as manufacturing, electrotechnology and textile, clothing and footwear. Although the issue is well understood,
many industries are having difficulty encouraging new entrants in order to offset a
looming increase in retirement. As a result, there is concern around the implications
for skill shortages in specific occupations.
 There is some concern that changes to funding arrangements for the VET sector will
have implications for skill needs in 2012. The changes include the reduction in the
disparity between funding for TAFE and private providers, along with reductions in
some industry funding weightings (with growing enrolments in specific qualifications
generating a reduction in training provider funding for all qualifications within a
broader industry).
Key demand side issues
Key demand side issues having a general impact on Victorian industries include the
following:
 Broad economic conditions, including the resources boom, were cited as an important
demand side issue across a number of industries. In some sectors, Australia’s two
speed economy is generating strong competition for skilled labour, with higher wages
available outside Victoria. Weaker economic conditions outside the resources sector
are also relevant, with soft housing conditions and weak retail sales weighing on the
outlook in some industries.
 A related issue is the high $A, which is also influencing the business environment for
export industries and those which compete with imported products (such as food,
forestry, manufacturing and services). The elevated exchange rate is also contributing
to some of the variability in oil prices, which is a particular concern in the transport
sector.
 The changing nature of consumer demand is relevant for skill needs across industries
such as food, forestry, primary industries and services.
Consumers are seen as
increasingly ethically responsible and time poor. As such, there is a growing need to
provide services in line with consumer expectations of ethical and sustainable practices.
 The rollout of the National Broadband Network will have demand implications for the
electro-technology and manufacturing and engineering sectors. Once the installation is
complete, the culture and recreation sector is expecting demand for media- and
internet-related services to increase, underpinning a growing skill need.
 Finally, industry-specific regulatory change is also expected to be an important demand
side driver of skill needs in 2012. They include, for example, building and sustainability
regulations in the construction sector, the national approach to qualifications in the
childcare sector, and animal welfare in primary production and processing.
Deloitte Access Economics
ii
Prospects for employment growth
Deloitte Access Economics expects the Victorian economy to record modest employment
growth of 0.8% in 2012 – the lowest growth for a little over a decade – following the solid
employment growth of 2.1% recorded in 2011. The State’s unemployment rate is projected
to rise to 5.6% in 2012 from an average of 5.1% in 2011.
Applying the ANZSIC industry structure, the utilities and construction sectors are expected
to record the strongest rate of employment growth in 2012, followed closely by mining and
health care and social assistance. In contrast, financial and insurance services and
accommodation and food services may record softer growth in 2012, while employment in
professional, scientific and technical services, arts and recreation services and
manufacturing is expected to fall back modestly.
The chart below shows how these projections translate into forecasts according to the ITAB
industry structure. Community services and health, building and construction, and water
are seen leading the way, while racing (a small industry, and therefore more subject to
sampling variability) is forecast to record a recovery following a sharp dip in employment in
2011.
Chart i: Industry employment growth in Victoria – 2012 (ITAB structure)
Automotive
Service skills
Business services
Forestry
Textiles, clothing and footwear
Furniture
Culture and recreation
Victoria
Primary
Manufacturing and engineering
Food
Transport
Water
Electro-technology and communication
Building and construction
Community services and health
Racing
-5%
0%
5%
10%
15%
20%
25%
30%
Employment growth in 2012
Source: Deloitte Access Economics
The table below provides a summary of the occupations in critical shortage identified in this
report. The occupations are listed by both industry title and a corresponding title according
to the Australian and New Zealand Standard Classification of Occupations (ANZSCO). The
table also includes the related qualifications which are required for occupations
experiencing a critical skill shortage.
Deloitte Access Economics
iii
Industry title
Table ii: Summary of critical skill shortages
ANZSCO classification and related qualification
Automotive
Light vehicle mechanic
Motor mechanic (general) (321211)
Certificate III in Automotive Technology (Light Vehicle)
Heavy vehicle mechanic
Diesel motor mechanic (321212)
Certificate III in Automotive Technology (Heavy Vehicle)
Panel beater
Panelbeater (324111)
Certificate III in Automotive Vehicle Body (Panel Beating)
Spray painter
Vehicle painter (324311)
Certificate III in Automotive Vehicle Body (Vehicle Painting)
Auto electrician
Automotive electrician (321111)
Certificate III in Automotive Electrical Technology
Building and construction
Plant operator
Earthmoving plant operator (721211)
Certificate III in Civil Construction Plant Operations
Road construction (Asphalt)
Road roller operator (721915)
Paving plant
(721913) and Maintenance
Certificate
III operator
in Road Construction
Project manager
Construction project manager (133111)
Certificate IV in Building and Construction (Building)
Certificate IV in Building and Construction (Site management)
Diploma of Building and Construction (Building)
Building surveyor / Building inspector
Building inspector (312113)
Diploma of Building Surveying
Advanced Diploma of Building Surveying
Estimator
Construction estimator (312114)
Certificate IV in Building and Construction (Estimating)
Business services
Accounting
Accountant (General) (221111)
Certificate IV in Accounting
Diploma of Accounting
Advanced Diploma of Accounting
Waste management drivers
Recycling or rubbish collector (899611)
Certificate III in Asset Maintenance (Waste management)
Certificate IV in Asset Maintenance (Waste management)
Sustainability assessors
Environmental manager (139912)
Certificate III in Asset Maintenance (Waste management)
Certificate IV in Asset Maintenance (Waste management)
Certificate IV in Home Sustainability Assessment
Continued on following page
Deloitte Access Economics
iv
Community services and health
Aged care workers
Aged or disabled carer (423111)
Certificate III – Aged care
Certificate III – Home and Community Care
Certificate IV – Home and Community Care
Certificate IV – Nursing
Certificate IV – Allied Health Assistance
Diploma – Nursing for (a) new entrants and (b) existing workers
Enrolled nurses
Enrolled nurse (411411)
Certificate IV – Nursing
Certificate IV – Allied Health Assistance
Diploma – Nursing for (a) new entrants and (b) existing workers
Children’s services workers
Child care worker (421111)
Certificate III – Children’s Services
Diploma – Children’s Services (Early Childhood Education and
Care) – Children’s Services (Outside School Hours Care)
Diploma
Child protection workers
Family support worker (411713)
Welfare worker
(272613)
Vocational
Graduate
Certificate – Community Services Practice
(Statutory
child
protection)
Certificate IV – Child, Youth and Family Intervention
(Residential
out of
homeand
care)
Certificate IVand
– Child,
Youth
Family Intervention (Child
protection)
Certificate IV – Child, Youth and Family Intervention (Family
Disability services workers
support)
Disabilities services officer (411712)
Certificate IV – Disability
Diploma – Disability
Advanced Diploma – Disability
Community care workers
Community worker (411711)
Certificate IV – Community Service (Alcohol and other drugs)
Certificate IV – Community Service (Mental health)
Diploma – Community Service (Alcohol and other drugs)
Diploma – Community Service (Mental health)
Diploma – Community Service (Alcohol, other drugs and mental
health)
Diploma – Community Service (Case management)
Diploma – Community Services Coordination
Advanced Diploma – Community Sector Management
Vocational Graduate Diploma – Community Sector
Management
Vocational
Graduate Certificate in Community Services Practice
Culture and recreation
(Client assessment and case management)
Swimming coach / Aqua instructor
Swimming coach or instructor (452315)
Certificate III in Aquatics
Lifeguard
Lifeguard (452414)
Certificate III in Aquatics
Continued on following page
Deloitte Access Economics
v
Camera operator (film, television, or video)
Camera operator (399512)
Certificate IV in Broadcast Technology
Cinema theatre/facilities manager
Cinema or theatre manager (149912)
Diploma of Venues and Events
Advanced Diploma of Venues and Events
Lighting technician
Light technician (399513)
Certificate III in Live Production, Theatre and Events
Certificate IV in Live Production, Theatre and Events
Certificate IV in Screen Media
Certificate IV in Electrotechnology
Diploma of Screen and Media
Multi/New/Interactive media designer
Multimedia designer (232413)
Certificate IV in Interactive Digital Media
Certificate IV in Information Technology (Multimedia)
Diploma of Interactive Digital Media
Multimedia specialist and web developer
Multimedia specialist (261211)
Web developer
(261212) Technology (Websites)
Certificate
IV in Information
Diploma of Information Technology (Websites)
Post-production media technician
Production assistant (599912)
Certificate IV in Screen Media
Certificate IV in Electrotechnology
Certificate IV in Interactive Digital Media
Diploma of Screen Media
Electro-technology and communications
Cable Jointing
Technical cable jointer (342212)
Telecommunications
cableJointing
jointer (342412)
Certificate
III in ESO Cable
Rail Signalling
Railway signal operator (712917)
Certificate IV in Rail and Tram Signal Systems
Motor Rewinding
Electrician (General) (341111)
Certificate III in Electrical Motor Repair
Telecommunications Cabler
Cabler (Data and telecommunications) (342411)
Certificate III in Telecommunications
Certificate III in Telecommunications Cabling
Digital Printing
Small offset printer (392312)
Certificate III in Printing and Graphic Arts (Digital Printing)
ESI Line worker
Electrical lines worker (342211)
Certificate III in ESI – Distribution
Substation Electrician
Electrician (Special class) (341112)
Certificate IV in ESI – Substation
Continued on following page
Deloitte Access Economics
vi
Food processing
None reported
Forestry
Saw doctor
Saw maker and repairer (323315)
Certificate III in Saw Doctor
Pulp and paper technician
Paper and pulp mill operator (712916)
FPP10 ASCED Manufacturing Engineering and Technology
Detailer / Estimator
Forestry worker (841311)
Silviculture and harvesting team leaders
Certificate III in Timber Truss and Frame Design and
Manufacturing
Forester (234113)
Certificate III in Harvest and Haulage
Certificate III in Forest Growing Management
Wood machinist
Wood machinist (394213)
Certificate III in Wood Machinist
Forest technicians and land managers
Forester (234113)
Advanced Diploma of Forest Industry Sustainability
Furnishing
Stained glass and lead lighting
Glazier (333111)
Certificate III in Glass
Cabinet maker/installer
Cabinetmaker (394111)
Certificate III in Cabinet Making
Glass and glazing
Glazier (333111)
Certificate III in Glass
Flooring installer
Floor finisher (332111)
Certificate III in Flooring Technology
Upholsterer
Upholsterer (393311)
Certificate III in Upholstery
Curtin, blind and awning maker and installer
Home improvement installer (821412)
Certificate III in Soft Furnishings
Certificate III in Blinds and Awnings (n/a)
Manufacturing and engineering
Sheetmetal Trades Worker
Sheetmetal Trades Worker (322211)
Certificate III in Engineering – Fabrication trade
Aircraft Maintenance Engineer (Mechanical)
Aircraft Maintenance Engineer (Mechanical) (323112)
Certificate IV in Aeroskills (Avionics, Mechanical and Structures)
Aircraft Maintenance Engineer (Avionics)
Aircraft Maintenance Engineer (Avionics) (323111)
Certificate IV in Aeroskills (Avionics, Mechanical and Structures)
Aircraft Maintenance Engineer (Structures)
Aircraft Maintenance Engineer (Structures) (323113)
Certificate IV in Aeroskills (Avionics, Mechanical and Structures)
Metal machinists
Metal machinist (first class) (323214)
Certificate III in Engineering – Mechanical trade
Continued on following page
Deloitte Access Economics
vii
Air-conditioning and refrigeration mechanic
Air-con. and refrigeration mechanic (342111)
Certificate III in Engineering – Mechanical trade
Metal Fabricator (Boilermaker)
Metal Fabricator (322311)
Certificate III in Engineering – Fabrication trade
Metal fitters and turners
Metal Fitter and Turner (323212)
Certificate III in Engineering – Mechanical trade
Primary industries
Arborist
Arborist (362212)
Certificate III in Arboriculture
Diploma of Arboriculture
Animal technician
Life science technician (311413)
Diploma of Animal Technology
Agronomist
Agricultural scientist (234112)
Diploma of Agronomy
Greenkeeper
Greenkeeper (362311)
Certificate III in Parks & Gardens
Diploma of Parks & Gardens Management
Parks and gardens worker
Gardener (General) (362211)
Certificate III in Sports Turf Management
Diploma of Sports Turf Management
Racing
Track Rider
Stablehand (841516)
Certificate III (Trackriding)
Services
Retail manager
Retail manager (General) (142111)
Diploma of Retail Management
Vocational Graduate Certificate in Retail
Supervisory staff – Retail
Retail supervisor (621511)
Certificate IV in Retail Management
Chef
Chef (351311)
Certificate IV, Diploma and Advanced Diploma of Hospitality
Hotel manager
Hotel or Motel Manager (141311)
Diploma of Hospitality
Restaurant managers
Cafe or Restaurant Manager (141111)
Diploma of Hospitality
Wait staff
Waiter (431511)
Certificate III in Hospitality
Continued on following page
Deloitte Access Economics
viii
Textiles, clothing, footwear and leather
Textile clothing and footwear mechanic
TCF mechanic (323215)
Certificate III in Engineering – TCF Mechanic
Apparel patternmakers / Graders
Clothing patternmaker (393212)
Diploma of Applied Fashion Design and Technology
Dressmakers / Tailors
Dressmaker or tailor (393213)
General footwear tradesperson
Certificate IV in Clothing Production
Shoemaker (393114)
Certificate III in Footwear Production
Transport and storage
Heavy rigid to multi-combination drivers
Truck driver (general) (733111)
Tanker driver
Certificate
II in(733114)
Driving Operations
Certificate III in Driving Operations
Rail drivers
Train driver (731311)
Tram
driverIV(731312)
Certificate
– Transport and Logistics (Rail Operations)
Transport company manager
Transport company manager (149413)
Diploma of Logistics
Warehouse administrator
Warehouse administrator (591116)
Certificate IV in Warehousing Operations
Bus driver
Bus driver (731211)
Certificate III Transport & Logistics (Driving Operations)
Certificate IV Logistics
Deck hand / general purpose hand
Deck hand (899211)
Crane, hoist or lift operator
Certificate II/III in Transport & Distribution (Maritime
Operations)
Crane, hoist or lift operator (712111)
Certificate II in Stevedoring
Certificate III in Stevedoring (Crane Operations)
Certificate III in Stevedoring (Team Leading)
Certificate IV in Stevedoring Operations
Forklift driver
Forklift driver (721311)
Certificate III in Warehousing Operations
Water
None reported
Deloitte Access Economics
30 March 2012
Deloitte Access Economics
ix
2012 ITAB Market Effectiveness Report
1 Introduction
The Higher Education and Skills Group (formerly Skills Victoria) commissioned Deloitte
Access Economics to work with Victorian Industry Training Advisory Bodies (ITABs) to
produce the 2012 ITAB Market Effectiveness Report. The Market Effectiveness Report
expands on the Industry Skill Needs Reports produced for the Higher Education and Skills
Group in recent years by also incorporating ITAB intelligence on training market
effectiveness, including identified market successes and failures.
The purpose of the Market Effectiveness Report is to present an overview of skill needs in
the Victorian economy, including analysis of occupations in demand and experiencing
critical skill shortages, and to provide a summary of market effectiveness in the Victorian
market for vocational education and training. The report is designed to assist the Higher
Education and Skills Group in assessing the performance of the training market, providing
industry intelligence to individuals and businesses, and stimulating training demand in skill
shortage areas.
This report incorporates Deloitte Access Economics’ views, along with a summary of
industry intelligence gathered from the 16 Victorian ITABs. The ITAB advice was provided
to Deloitte Access Economics during meetings and through other correspondence in late
2011 and early 2012. The industry advice presented in this report has also been informed
by consultations held with representatives of various Victorian government agencies.
The report is structured around sixteen chapters, each dedicated to providing advice
relevant to a particular industry. These chapters include a summary of:

Training market effectiveness, including examples of market success and failure;

Industry change drivers and developments in 2012 and likely implications for skill needs;

An industry outlook compiled by Deloitte Access Economics, including forecasts of
industry employment;

ITAB and industry responses to critical skill shortages identified in the 2011 Industry
Skill Needs Report;

Occupations expected to be in demand and experiencing critical skill shortages in 2012;
and,

A list of qualifications required for occupations experiencing a critical skills shortage.
Where data is available, these industry chapters include data on vacancies, drawn from
Skilled Vacancy Index published by the Commonwealth Department of Education,
Employment and Workplace Relations (DEEWR). There are some shortcomings to using this
data. For example, the index is based on the number of advertised vacancies and is not a
detailed measure of unmet demand. In this report, the vacancy data is presented as an
index, with the number of vacancies in 2000 set equal to 100. Due to the availability of
data, in each of these charts the data for 2011 represents the average of monthly data over
the ten months to October 2011.
Each industry chapter begins with a brief overview of the industry, as described in the box
below.
Deloitte Access Economics
10
2012 ITAB Market Effectiveness Report
Coverage: The occupations covered by the industry.
Specific industry and business cycle drivers: Specific factors of particular
importance to the industry and relevant economic factors.
Recent relative employment performance rating: A ranking of the industry’s
employment growth performance over the three years to 2011. The ranking –
rated as Low, Below Average, Average, Above Average and High – is relative to
the employment performance of the other industries examined in this report.
Expected relative employment performance rating: A ranking of the
industry’s expected employment growth performance over the three years
from 2011.
In defining the lists of occupations in demand and experiencing critical skill shortages, ITABs
were required to apply criteria developed by the Higher Education and Skills Group. The
criteria are based on definitions used by Skills Australia and the Commonwealth
Department of Education, Employment and Workplace Relations. The definition used to
identify an occupation in demand is as follows:
An occupation is in demand when employers are unable to fill or have
considerable difficulty filling vacancies for the occupation, or significant
specialised skill needs within that occupation over an extended time period, at
market rates of remuneration and standard conditions of employment, and in
reasonably accessible locations.
Of those occupations listed as in demand, occupations were also considered to be
experiencing a critical skill shortage if they met the following four criteria:

Long lead time: Occupations that require skills which are highly specialised and
require extended learning and preparation time over several years.

High use: Where there is a high incidence of those undertaking formal training for a
qualification subsequently taking up employment in the corresponding occupation.

High risk: Occupations where the disruption caused by the skills being in short supply
imposes a significant risk to the Australian economy and/or community.

High information: Where the quality of information on the occupation is adequate to
the task of assessing future demand and evaluating the first three criteria.
In addition to the industry-specific discussion and occupation lists, this report also includes
broader information and commentary in two initial chapters. Chapter 2 includes forecasts
of key Victorian economic indicators and employment by industry, while Chapter 3 provides
a broad overview of training market effectiveness.
The forecasts in Chapter 2 have been compiled according to two industry structures:

The Australian and New Zealand Standard Industry Classification (ANZSIC) published
by the Australian Bureau of Statistics (ABS). Deloitte Access Economics has included
forecasts completed at the one-digit ANZSIC level.

An industry structure which is representative of the industry coverage of each ITAB.
The concordance between ANZSIC and ITAB industry structures developed by Deloitte
Access Economics is included at Appendix A. We caution that this concordance will not
always provide an accurate reflection of the employment base covered by each ITAB.
Deloitte Access Economics
11
2012 ITAB Market Effectiveness Report
2 Industry employment forecasts
The following charts and tables provide a brief snapshot of Victoria’s economy, along with
Deloitte Access Economics’ economic and employment forecasts. The employment
forecasts are provided for the ITAB industry structure and the ANZSIC industry structure.
There are some limitations of using the ANZSIC industry structure to assess employment
prospects across ITAB industries. For example, the rise of part-time farmers means that the
Victorian primary industry often provides a secondary source of income for individuals. The
implication is that a count of those who identify as employed in primary industry may not
fully capture the industry coverage in aggregate. Imperfect alignment between the
coverage of each ITAB industry and the ANZSIC industry categories may also give rise to
some discrepancies in estimating the employment coverage of some ITABs. For example,
advice from ITABs suggests that 2011 employment in the furnishing and forestry industries
was 20,000 and around 27,500 respectively. That compares to the respective estimates of
around 14,000 and 21,000 presented in Table 2.2 below.
Moreover, the activities covered by some ITABs (particularly across creative, leisure and
‘emerging’ industries) may not be adequately captured within the ANZSIC categories for the
purpose of making an accurate comparison with the coverage of the relevant ITAB.
These definitional issues cannot be fully overcome through the concordance between
ANZSIC and ITAB classification structures, and should be considered when examining these
forecasts.
Snapshot of the Victorian economy

Gross State Product (real)
$305.6 billion

GSP per capita: $54,646 (2010-11)
Population

5.59 million (2010-11 est.)
Labour force
3.02 million
Unemployment rate: 5.2% (December 2011)

Key merchandise trade partners
China 19.5%, United States 11.0%, Japan 8.0%, New Zealand 5.8%, Germany 5.1% (2011)
Key forecasts
Annual % change except
where noted *
2009
Real gross state product
Dwelling investment
Private consumption
Employment
Unemployment rate *
Total population
Consumer Price Index
1.4%
5.6%
1.3%
1.0%
5.7%
2.2%
1.4%
History
Forecast
2010
2.4%
6.5%
3.6%
3.8%
5.4%
1.7%
3.0%
2011
2.4%
5.7%
3.8%
2.1%
5.2%
1.5%
3.5%
2012
2.1%
-1.8%
3.6%
0.8%
5.6%
1.6%
2.4%
2013
3.3%
5.7%
3.2%
1.7%
5.7%
1.5%
3.1%
Source: Deloitte Access Economics, Australian Bureau of Statistics. Note: Business investment excludes intangibles.
Deloitte Access Economics
12
2012 ITAB Market Effectiveness Report
Table 2.1: Annual industry employment growth – Victoria (ANZSIC industry structure)
Employment level in 2011
Forecast
2012
Agriculture, Forestry and Fishing
75,889
1.0%
1.6%
0.6%
Mining
11,720
5.6%
3.5%
5.4%
304,264
-0.9%
-0.4%
-0.9%
76,351
1.8%
2.9%
2.4%
Textile, Leather, Clothing and Other
38,308
-0.2%
-1.1%
-2.1%
Wood, Pulp and Paper
19,195
-0.9%
-2.6%
-0.3%
Printing and Recorded Media
14,412
-1.4%
2.0%
-0.8%
Petroleum, Coal, Chemical and Polymers
35,234
4.8%
1.2%
0.1%
Non-Metallic Minerals
11,003
1.5%
-2.3%
-2.8%
Primary and Fabricated Metals
37,640
-6.4%
-1.8%
-2.0%
Transport and machinery equipment
72,124
-4.2%
-3.4%
-3.8%
37,392
6.1%
5.0%
3.9%
Construction
263,650
6.0%
5.3%
2.2%
Wholesale Trade
113,184
3.0%
-1.1%
1.4%
Retail Trade
317,896
0.1%
-0.1%
0.6%
Accommodation and Food Services
179,169
-3.3%
1.4%
0.6%
Transport, Postal and Warehousing
142,538
-2.9%
3.8%
1.8%
57,928
3.1%
1.7%
0.9%
122,710
-7.6%
6.6%
1.8%
44,952
2.4%
3.6%
1.7%
Professional, Scientific and Technical
234,125
-4.1%
3.8%
4.2%
Administrative and Support Services
107,222
4.4%
2.9%
2.6%
Public Administration and Safety
137,650
-1.4%
0.7%
1.3%
Education and Training
217,519
-0.5%
2.0%
2.5%
Health Care and Social Assistance
337,428
5.2%
3.9%
2.1%
59,801
-1.6%
2.2%
1.7%
112,680
3.3%
1.6%
1.1%
2,877,715
0.8%
1.7%
1.1%
Manufacturing
Food, Beverage and Tobacco
Electricity, Gas, Water and Waste
Info. Media and Telecommunications
Financial and Insurance Services
Rental, Hiring and Real Estate Services
Arts and Recreation Services
Other Services
Victoria
2013
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
As Table 2.1 shows, Deloitte Access Economics expects the Victorian economy to record
modest employment growth of 0.8% in 2012 – the lowest growth for a little over a decade –
following the solid employment growth of 2.1% recorded in 2011. The State’s
unemployment rate is projected to rise to 5.6% in 2012.
By industry, the utilities and construction sectors are expected to record the strongest rate
of employment growth in 2012, followed closely by mining and health care and social
assistance. In contrast, financial and insurance services and accommodation and food
services may record softer growth in 2012, while employment in professional, scientific and
technical services, arts and recreation services and manufacturing is expected to fall back
modestly.
Deloitte Access Economics
13
2012 ITAB Market Effectiveness Report
Table 2.2: Annual industry employment growth – Victoria (ITAB industry structure)
Employment level in 2011
Automotive
Building and construction
Business services
Community services and health
Cultural and recreation
Electro-technology and communication
Food
Forestry
Furniture
Manufacturing and engineering
Primary
Racing
Services
Textiles, clothing and footwear
Transport
Water
Forecast
2012
105,359
263,650
438,673
337,428
61,635
74,817
76,351
20,907
13,783
218,658
82,910
2,304
638,643
19,530
142,538
11,836
-3.8%
4.0%
-2.7%
5.1%
0.6%
2.1%
1.7%
-2.0%
-0.8%
1.0%
0.8%
29.2%
-2.8%
-1.6%
1.7%
2.1%
2013
2014
-2.0%
5.3%
5.1%
4.0%
1.4%
0.2%
1.2%
-2.0%
0.9%
0.0%
1.6%
16.3%
0.4%
-3.1%
4.6%
4.2%
-3.2%
2.2%
3.5%
3.2%
1.4%
0.0%
1.9%
0.0%
-1.2%
-0.1%
0.7%
10.8%
0.9%
-3.6%
2.3%
3.5%
Source: Deloitte Access Economics, Australian Bureau of Statistics
Chart 2.1: Industry employment growth in Victoria – 2012 (ITAB structure)
Automotive
Service skills
Business services
Forestry
Textiles, clothing and footwear
Furniture
Culture and recreation
Victoria
Primary
Manufacturing and engineering
Food
Transport
Water
Electro-technology and communication
Building and construction
Community services and health
Racing
-5%
0%
5%
10%
15%
20%
25%
30%
Employment growth in 2012
Source: Deloitte Access Economics
Table 2.2 shows how these projections translate into forecasts at the ITAB level, with
community services, building and construction, and water leading the way, while racing (a
small ITAB, and therefore more subject to sampling variability) is forecast to record a
recovery following a sharp dip in employment in 2011, generating its strength in Chart 2.1.
Deloitte Access Economics
14
2012 ITAB Market Effectiveness Report
3 Overview of market effectiveness
As noted above, this report expands on the Industry Skill Needs Reports compiled for the
Higher Education and Skills Group in previous years. The key additional focus is the
reporting of market effectiveness – that is, instances of both market success and market
failure in the Victorian vocational education and training market.
Following the implementation of a more market-based training system in the State – the
Victorian Training Guarantee (VTG) – the Victorian Government has recognised the need to
monitor the operational effectiveness of the system and, where necessary, appropriately
intervene to address any market failure.
The inclusion of industry intelligence on market effectiveness in this report is designed to
assist the Higher Education and Skills Group to more fully understand the operation of the
new training system and to identify and rectify market failures as they arise.
Deloitte Access Economics has sought to gather specific examples of market success and
failure from ITABs. This chapter provides some background on Deloitte Access Economics’
approach to defining market effectiveness and includes examples relevant to the training
market as a whole rather than to individual industries. Industry-specific examples of
market success and failure are contained within each of the sixteen industry chapters which
follow.
Defining market effectiveness
Victorian Government reforms have moved the VET sector toward a demand-driven model.
The establishment of the VTG means that there is no set limit to the number of places a
contracted VET provider can offer in any course it is registered to provide. Individuals in
Victoria can access training through the VTG at a provider of their choice, provided they
meet the eligibility criteria.
Eligibility arrangements were fully implemented for all VET qualifications from 1 January
2011. To be eligible for a government funded place under the VTG, individuals must be:

Under 20 years of age; or,

Undertaking a foundation skill course to address low literacy and numeracy; or,

Undertaking an apprenticeship or traineeship; or,

Up-skilling – undertaking a higher level course than their highest existing qualification.
The reforms also mean that the training market is now fully contestable, with funding for
government subsidised places available to both government and private providers who
apply and are approved for funding relating to eligible students.
The expected corollary of these reforms is that if VTG-eligible individuals cannot access the
training they desire, a market failure must exist. This form of market failure is examined in
this report. Importantly, the effectiveness of the training market is therefore assessed
within the current policy parameters set by the Victorian Government.
Deloitte Access Economics
15
2012 ITAB Market Effectiveness Report
Defining market success is less straightforward. It could be argued, for example, that
success in the vocational education and training system simply involves an increasing rate
of matriculation of students through courses over time. However such a definition provides
few opportunities to explore positive training market outcomes through discrete examples.
In order to capture specific examples of market success, we have attempted to focus on
instances where an increase in the quantity and/or quality of completing students has
targeted a known training need or has otherwise had an identifiable positive impact. This
could include, for example, cases where a skill shortage or market failure has been
corrected, or where active involvement by industry participants has contributed to
stimulating training demand in a particular area. This approach necessarily incorporates
some examples of market intervention where it has been a positive influence in the training
market.
Examples of market success
In the main, examples of market success nominated by ITABs focused on the identification
and closing of a gap in the training market. In many instances, this was achieved by
mobilising a suitable training provider or actively encouraging industry participation in the
training market.
The examples highlight the capacity to stimulate training demand and develop and tailor
new training packages aimed at a specific training need. Many of the examples relate to
the activities of individual ITABs. However there are also cases of industry-led responses to
training provision and instances where additional government funding has assisted to meet
skill needs.
Examples of market failure
The impact of thin markets was raised as a market failure by a number of ITABs. The issue
results when demand for a training course is insufficient for training providers to offer it, a
situation most prevalent in regional areas (often served by a single training provider).
Although the issue appears well understood throughout the training system, a universal
solution is not apparent (and may not exist). The problem of thin markets has been
overcome in some specific instances through more flexible training delivery and greater
cooperation between industry and providers.
A further example of market failure involves training providers (particularly those which are
publicly funded) not keeping up with technological changes in the industry. This issue
arises because of the pace with which technology changes and the cost of purchasing and
maintaining specific equipment, and can result in outdated or irrelevant training and the
stifling of skill acquisition. There have been some examples of training providers
collaborating with industry more effectively in order to access the latest equipment and
provide training which is as relevant as possible.
Related to this, it was reported that employers across a number of industries have been
unsatisfied with the quality of graduating students. A common complaint is that students
are not ‘work ready’, generating a loss of confidence in the training system among some
employers.
Deloitte Access Economics
16
2012 ITAB Market Effectiveness Report
4 Automotive
Coverage: Automotive (passenger motor vehicles, light commercial, truck,
bus, trailer, recreational vehicles) manufacturing, retail, service and repair, and
allied industry (earthmoving and construction, outdoor power equipment,
recreational boating, recreational vehicles, bicycles).
Specific industry and business cycle drivers: Interest rates, tax provisions, the
$A, tariff protection, Federal Government subsidies, petrol prices and the level
of global capacity.
Recent relative sectoral performance rating: Below average
Expected relative sectoral performance rating: Low
Summary of ITAB advice and consultation
Market effectiveness
Automotive Training Victoria (ATV) report a mix of training market successes and failures
for 2011. The examples of success demonstrate ATV and industry efforts translating into
increased training in niche areas and the attraction of new entrants to the sector. The
examples of market failure relate to skill needs that are emerging at a pace that the training
sector cannot match.
Engine reconditioning provides a rare example of success in automotive training in recent
years. This specialised skill – which applies to vehicle restoration, heavy vehicles and
warranty work for manufacturers (all growing trades) – has traditionally proved a thin
training market. However more recently, in cooperation with both large and small
employers, around 20 students are being enrolled in the course per annum, with a mix of
workplace and classroom training delivery. This level of training delivery will alleviate
existing skill shortages if maintained.
Continued difficulty in recruiting apprentices led ATV to set a goal of attracting 40 schoolbased apprentices into the industry in 2011, utilising new technologies as the angle by
which to generate interest. Working with the Victorian Chamber of Commerce and
Industry, there was little difficulty in identifying suitable employers given the high demand
for skills across the industry. Indeed the majority of these apprentices start at the
Certificate II level in dealerships, and then move into a variety of other areas of these
businesses. Additional funding from the State Government helped support this initiative.
In terms of market failures, automotive trimming remains a niche business, with
corresponding low volume of highly specialised skill needs. In the existing format, training
providers are currently only partly delivering the competencies required of a motor
trimmer (similar issues are experienced by other parts of the automotive industry). This
represents an example of the difficulties in providing external training at a trade skill level
when a very limited number of individuals are engaged in the trade. Vehicle restoration
businesses and the like will feel this labour constraint more acutely as they attempt to
expand or face new industry entrants.
Deloitte Access Economics
17
2012 ITAB Market Effectiveness Report
The Victorian bicycle industry is experiencing significant growth. Coupled with the
introduction of complex materials and repair techniques (such as relating to carbon fibre),
this is generating a significant skill need. However, appropriate training is not available and
instead the sector is said to be importing skilled workers from outside the State to meet
requirements and training on the job. High-end bicycle repair is therefore an emerging gap
in training delivery, though the Certificate II in Bike Maintenance remains in high demand.
ATV acknowledge further success in attracting and retaining skill to the industry will be
driven by industry and its ability to inform potential new workers (and their key influencers)
on prospects and careers paths available, ensuring they are relevant to what the current
generation of workers is demanding. It is also a case of the industry needing to restructure
such that those skills in demand are mobile across businesses (as has been seen with top
line technicians working across a number of businesses within a dealer network).
Change drivers and industry developments
ATV reported a number of change drivers for 2012, similar to those identified in 2011. They
cover both demand and supply side issues, and include:

Continuous technological advancement in service and repair (demand side)

Growing uncertainty for future vehicle manufacturing (demand and supply side)

Growth in the resources sector (demand and supply side)

Public training provider capacity/currency (supply side).
The strong Australian dollar, pressure on government budgets, and the shift in consumer
demand for small fuel efficient vehicles and sports utility vehicles, is compounding
uncertainty around the future of automotive manufacturing in Australia and Victoria. The
implication is the future skill needs of the sector are unclear, the ability to recruit labour
when career prospects are in doubt is limited, and the only way to minimise skill shortages
is through specialised in-house training with short lead times (in production and assembly).
Technological advancements in diagnostics remains the key to the success of automotive
service and repair businesses in terms of the ability to identify the problem and solution in
a timely and efficient manner, with the industry now less dependent on traditional repair
skills. The service and repair aspects of automotive businesses are becoming more
important to business viability than vehicle retailing, given the relative margins attached to
each.
While manufacturers have traditionally held diagnostic technologies in-house (by way of
preserving demand for after-sales service), United States legislation is now obliging this
information be made available to the broader service and repair sector, and with this
movement submissions are now being made to the Commonwealth Government for similar
legislation. The implication is that service and repair businesses in Victoria can now at least
import this information – at cost – to ensure their continued relevance as older vehicles are
scrapped from the fleet.
While public training providers are providing basic electrical-based skills training, and the
Automotive Centre for Excellence in Melbourne is in particular delivering advanced training,
training in general is not meeting the technological demands of the vast number of nonmanufacturer-backed service and repair businesses across the state. Advice from ATV is
that the quicker the latest information and technology is available for broader training
consumption, the sooner there will be an increase in industry up-skilling, new industry
Deloitte Access Economics
18
2012 ITAB Market Effectiveness Report
entrants (particularly younger technology-minded individuals) and accordingly institutional
uptake.
With the increase in the cost of vehicle repairs (both labour and capital components), and
as it relates to regulation around vehicle registration, there has been a lift in the ‘economic’
write off of damaged vehicles (where the cost to repair is greater than the market value of
the car). While on the one hand this reduces demand for the repair sector, this is being at
least partly offset by the cases of ‘repairable write off’. This is particularly relevant in times
of increased storm activity, as has been seen in 2011 and early 2012 in Victoria. The
Commonwealth Government is currently conducting an inquiry (the Bradbury Inquiry)
which will have implications for the persistence of this trade going forward.
Growth in the Australian resources sector remains a double-edged sword for automotive
output. At one level the demand for heavy vehicle mechanics to support the mining boom
is drawing new and existing light vehicle mechanics away with significantly higher wages.
Indeed existing light vehicle mechanics can retrain to attain the Certificate III in Heavy
Vehicle Mechanics in 2-3 months, and are happy to pay for the training out of their own
pocket given the improved earnings available. Furthermore the high $A is harming vehicle
exports. On the other hand truck component and assembly businesses, as well as other
heavy machinery business, continue to experience strong growth in sales and service.
Industry outlook
This industry has two parts: manufacturing and retailing. The manufacturing side includes
motor vehicle and motor vehicle parts manufacturers; while the retail side includes motor
vehicle and motor vehicle parts retailing (and wholesaling), as well as automotive repairs
and maintenance.
Australian vehicle manufacturers had a difficult start to 2011. Vehicle production in the
first three months of the year was down 17% on the same period last year, with total yearto-date production (to September 2011) 10% lower compared to last year. The latest data
from the Federal Chamber of Automotive Industries appear more positive. Production
increased by 10% in the September quarter to the highest quarterly level since the June
quarter of 2010.
A number of issues are relevant for the sector. Most notably, the strong Australian dollar
continues to challenge Australian manufacturers by reducing the price of imported
products. Despite a brief decline amid Europe’s economic turmoil, the $A is once again
firmly above parity with the $US. The currency may well remain elevated over the medium
term, but is expected to eventually retreat to longer term trend levels.
Another key issue for vehicle manufacturers going forward is carbon pricing. The start of
the carbon tax on 1 July 2012 will see Australia’s 500 largest companies required to pay a
fixed price of $23 for every tonne of carbon dioxide equivalent they release into the
atmosphere. This will affect the automotive industry both directly, through direct
obligations to purchase carbon permits, and indirectly, through higher input costs. Over
time it is expected that carbon pricing will lead to further restructuring of Australia’s car
industry as firms adopt ‘green’ production methods and technologies to reduce their
emissions liability.
Deloitte Access Economics
19
2012 ITAB Market Effectiveness Report
Chart 4.1: Employment outlook – Victorian automotive industry
'000 persons
140
Forecast
120
Change on year earlier
15%
Forecast
10%
100
5%
80
0%
60
-5%
40
20
-10%
0
-15%
1998
2002
2006
2010
2014
Victoria
1998
2002
Automotive
2006
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
Vehicle retailers also struggled through 2011, though not to the extent of manufacturers.
Year-to-date vehicle sales to December 2011 are 3.9% lower than the corresponding period
in 2010, although vehicle sales in Victoria are faring slightly better, falling just 1.6%.
Some of that sales weakness earlier in the year was due to supply disruptions following the
Japanese earthquake and tsunami. Activity did pick up over the September quarter, where
vehicle sales in Victoria were 10.5% higher than in the June quarter (in seasonally adjusted
terms). However, this growth was short lived, with growth falling once again in the
December quarter, by 1.7%. Retailers in general are likely to struggle over the next 12
months, including in the automotive sector.
Chart 4.2: Skilled Vacancy Index – Victorian automotive industry
Index: 2000 = 100
300
More
vacancies
250
200
150
100
50
Fewer
vacancies
0
1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011
Victoria (Total)
Panel beater
Auto electrician
Motor mechanic
Source: Commonwealth Department of Education, Employment and Workplace Relations
Deloitte Access Economics
20
2012 ITAB Market Effectiveness Report
The chart above shows skilled vacancies for workers in the Victorian automotive industry
(as measured by DEEWR’s Skilled Vacancy Index). It shows that vacancies for auto
electricians increased relatively sharply in 2011, while vacancies for motor mechanics and
panel beaters declined in line with the Victorian average. The latter is seemingly at odds
with the list of critical skill shortages discussed below. That may partly be explained by
some of the drawbacks of the Skilled Vacancy Index, which does not indicate whether a
decline in vacancies is due to weaker labour demand or stronger labour supply, or simply
because employers are giving up on trying to fill vacancies.
Overall, the negatives for this sector appear likely to continue to outweigh the positives,
and, after a lift in employment in 2011, employment in the sector is expected to continue a
downward trend over the medium term.
Occupations in demand and critical skill shortages
Response to 2011 critical skill shortages
For the majority of automotive occupations listed as in critical skill shortage in 2011, macro
and microeconomic developments have outweighed any market adjustments that ATV, in
conjunction with the automotive industry, have attempted.
Indeed the resources boom continues to have a negative effect on the availability of new
and existing light vehicle mechanics, heavy vehicle mechanics and automotive
electricians, with the prospect of significantly higher earnings in other industries. In all
three of these occupations, industry and ATV are attempting to up-skill those holding
Certificate II qualifications and are advising government on the suitability of migrant
workers. However, these initiatives have had little success to date in terms of alleviating
what is a growing shortage.
In terms of panel beaters and vehicles painters, while not subject to competition for skilled
workers with the resources sector, they continue to face difficulties in both attracting new
workers and up-skilling existing workers. The difficulties relate to career paths and
prospects, and the availability of appropriate training, respectively. Similar to the case of
mechanics and electricians, the response from industry and the ATV has been to look at
alternative sources of labour, though again with minimal success.
In contrast to the deteriorating conditions in the other five critical skill shortage
occupations during 2010, the shortage in truck assembly workers is said to have been
alleviated during 2011. The introduction of further automation and ‘smart’ assembly lines
is reducing the labour content of the production process. Furthermore the margins in these
vehicles is enabling improved earnings prospects for workers, helping to attract and retain
labour.
Occupations in demand and critical skill shortages in 2012
The tables below summarise the occupations in demand and experiencing critical skill
shortages in 2012. These occupation lists have been advised by ATV and have been
determined following formal engagement with industry.
Overall, the number of occupations in demand is reduced from 2011, though all of these
occupations are listed as experiencing a critical skill shortage.
Deloitte Access Economics
21
2012 ITAB Market Effectiveness Report
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Light vehicle mechanic
Heavy vehicle mechanic
Motor mechanic (general) (321211)
Diesel motor mechanic (321212)
Panel beater
Panelbeater (324111)
Spray painter
Vehicle painter (324311)
Auto electrician
Automotive electrician (321111)
Occupations experiencing a critical skills shortage
Industry title
ANZSCO classification
Light vehicle mechanic
Motor mechanic (general) (321211)
Heavy vehicle mechanic
Diesel motor mechanic (321212)
Panel beater
Panelbeater (324111)
Spray painter
Vehicle painter (324311)
Auto electrician
Automotive electrician (321111)
The table below outlines qualifications which are required for occupations experiencing a
critical skills shortage.
Qualifications required for occupations experiencing critical skill shortages
Occupation (Industry title)
Qualification
Light vehicle mechanic
Heavy vehicle mechanic
Certificate III in Automotive Technology (Light Vehicle)
Certificate III in Automotive Technology (Heavy Vehicle)
Panel beater
Certificate III in Automotive Vehicle Body (Panel Beating)
Spray painter
Certificate III in Automotive Vehicle Body (Vehicle Painting)
Auto electrician
Certificate III in Automotive Electrical Technology
Deloitte Access Economics
22
2012 ITAB Market Effectiveness Report
5 Building and Construction
Coverage: Civil Operations, General Construction, Plumbing Services, Shared –
Building and Construction.
Specific industry and business cycle drivers: Resource prices, demographics
(particularly population growth among those aged 18-30), interest rates
(particularly for housing construction), business investment.
Recent performance rating: High
Expected relative sectoral performance rating: High
Summary of ITAB advice and consultation
Market effectiveness
The Building Industry Consultative Council Industry Advisory Body (BICCIAB) reported a
number of examples of training market success and failure which have occurred within the
industry in recent years.
Examples of training market success centred on industry-led responses to skills demand,
including the provision of equipment and other capital resources which are vital to ensure
that apprentices and students are trained using the latest technology and machinery.
In particular, the establishment of the Australian Brick and Blocklaying Training Fund
(ABBTF) has been a strong example of training market success in the building and
construction industry. Historically, the sector has struggled to attract new apprentices into
the bricklaying trade, while significant proportions of the existing workforce are ageing and
do not possess formal qualifications. These challenges presented a current and growing
skills issue for the sector.
The ABBTF is a national organisation founded, in part, to reverse this trend. The fund has
implemented an apprenticeship scheme which is jointly funded by a levy on industry of $2
per thousand clay bricks or 10 cents per square metre of concrete masonry, and a matching
contribution from manufacturers. The scheme promotes apprenticeships in the sector
through a range of mechanisms, including a direct subsidy to employers for taking on an
apprentice and the funding of programs in schools. The ABBTF also performs a wider role
assisting skills development in the sector more broadly.
BICCIAB advises that the ABBTF has had a positive influence on apprentice numbers in
Victoria. In 2003 there were six registered training organisations (RTOs) with 432
apprentices in bricklaying in Victoria. There are now 13 RTOs and over 1,000 apprentices in
bricklaying.
Two other examples of training market success – the Plumbing Industry Climate Action
Centre (PICAC) and the Port Melbourne Training Centre – highlight the benefits of exposing
apprentices and existing workers to training opportunities using the latest technology and
equipment.
PICAC is an industry-led facility providing plumbers and apprentices with broad skills,
including a focus on sustainability. The success of PICAC stems from the ongoing
involvement of industry organisations, the use of leading technology, and growing flexibility
Deloitte Access Economics
23
2012 ITAB Market Effectiveness Report
around training delivery (such as out of hours training). PICAC has also introduced training
designed to meet demand in growing skill needs areas such as type A and B gas installation
and servicing, and fire protection. An example is the introduction of a new Diploma in Fire
Systems Design at the facility.
The Port Melbourne Training Centre is funded and run by the Construction, Forestry,
Mining and Energy Union and provides training for crane drivers and related skills such as
rigging, materials handling and labouring.
A significant capital investment – including the recent purchase of a new electric luffing
crane from Europe – means that the facility offers the opportunity to train using new
technology within a dedicated training environment.
A number of examples of failure in the training market were offered by BICCIAB. According
to BICCIAB, instructors involved in the VET in Schools and School Based New
Apprenticeships programs frequently are not trained or do not have trade experience in
the discipline they are instructing. This problem arises from a general shortage of
instructors due to relatively low pay, and can undermine the quality of the programs and
result in the under preparedness of apprentices. More significantly, these training
mechanisms lead students in years 10, 11 and 12 being graded as competent to the
equivalent level of a second year apprentice. However, without on-site experience or
access to off-site training resources at a TAFE, the individuals often struggle once they are
employed. BICCIAB believes that students exiting secondary school with a Certificate II in
Building and Construction are not as competent or industry-ready as those who have
completed a pre-apprenticeship at a TAFE.
BICCIAB also cited the limited availability of training in some regional areas as a market
failure. In particular, the advice of BICCIAB centred on the Mornington Peninsula region,
where a small number of training providers have wide geographic coverage. There is strong
demand for apprenticeships in the region (particularly around Dandenong), and in part the
difficulty involves waiting lists. Employers have been more reluctant to take on apprentices
as little residential construction activity is taking place in the area.
There is also some concern within industry regarding on-site assessments conducted by
some training providers. Instances of a ‘tick and flick’ approach to on-site assessments
have been noted, which does not foster improvement in the quality or competency of
apprentices. This issue is not relevant for apprentice plumbers, who require more formal
assessment due to licensing in the industry.
Change drivers and industry developments
BICCIAB reported several change drivers for 2012 that were identified during consultations
with industry stakeholders. They cover both demand and supply side issues, and include:

The lack of major civil infrastructure projects in the pipeline (demand side)

The economic cycle (demand side)

Regulatory change (demand side)

New materials and products (demand side)

Sustainability (demand and supply side)

Significant changes to VET fees and policies (supply side)

Workforce employment structure (supply side)

Competency based completion (supply side)

The need for small business and soft skills (supply side)
Deloitte Access Economics
24
2012 ITAB Market Effectiveness Report
BICCIAB notes that the economic cycle is expected to be a key demand side influence for
Victoria’s building and construction industry in 2012. A key component of this change
driver involves a lack of major civil infrastructure projects in the pipeline in Victoria, which
may mean a loss of workers to other States. This is perceived to be a larger potential
problem in civil construction, where it is common for large construction firms to move
workers from one project to the next, including interstate where necessary.
The concern raised by BICCIAB is the potential for long term or permanent loss of workers
from the State, which would leave a gap in the skills base when the construction cycle
improves. This problem could be exacerbated by the potential for employers to receive
larger training subsidies and levies outside Victoria, further encouraging the workforce to
shift interstate.
Other economic factors are expected to have a mixed impact on demand for skilled labour.
On one hand, Federal Government stimulus programs have drawn to a close, while housing
starts have dropped and construction on Victoria’s new desalination plant will be
completed shortly. However, the 2011 floods in northern Victoria have generated
construction demand and maintenance work is steady for businesses established in that
sector. Meanwhile, renovation activity is increasing, and some commercial building activity
is occurring in the Docklands area of Melbourne.
This patchwork activity across sectors highlights the need for workers to have broad skills
(transferable across residential and non-residential construction projects). These broad
skills are gained through the completion of an apprenticeship. However, solid construction
activity and a pipeline of projects is required to encourage employers to take on
apprentices and ensure ongoing skills acquisition and further growth in qualified workers
across the industry.
Various instances of regulatory change are expected to occur in 2012. They include the
introduction of new energy, waste and water policies by the Melbourne City Council to be
applied to all new building developments; national occupational health and safety
regulations; the National Construction Code; bushfire building regulations; a new six star
housing rating; and the implementation of national licensing for plumbers.
Industry will need to respond rapidly to each of these changes and, where necessary, run
targeted short course training for the existing workforce. These short courses may be
particularly relevant around the new bushfire regulations, waste management, recycling
and incorporating sustainable practices into work methods.
Although there are clear exceptions (such as PICAC), in general the industry has historically
been slow to take up new systems of working, including taking advantage of the
introduction of new materials and products. According to BICCIAB, this could be improved
by ensuring training for new workers is undertaken using the latest technology, while also
encouraging existing workers in the industry to complete short courses and seminars to
stay abreast of new product developments.
Sustainability and green skills continue to be a growing focus for the industry. BICCIAB
advises that awareness of sustainability issues is becoming increasingly embedded
throughout the industry. Building sites are becoming ‘cleaner’ in the sense that waste is
sorted and recycling has become more common. For example, BICCIAB noted that some
80% of a commercial building that is demolished is now recycled. Much of the progress in
Deloitte Access Economics
25
2012 ITAB Market Effectiveness Report
this area has been driven by regulatory change, including the move toward six star rated
houses. The Melbourne City Council is also encouraging the retro-fitting of some 1,200
buildings in Melbourne by linking building owners with finance.
In terms of skill implications, sustainability tends to involve changes in work practices rather
than new technical skills (though there are some exceptions, such as the skills offered to
the plumbing industry through organisations such as PICAC). To that end, the embedding
of sustainability units within all qualifications is important, while short post-trade courses
would assist existing workers, as would a focus on soft skills which could help to improve,
for example, the communication of sustainable alternatives to customers.
On the supply side, change drivers for the industry in 2012 include recent amendments to
fees and policies in the VET sector. BICCIAB reports some concern in industry regarding
the decrease in TAFE funding per student (reducing the disparity between funding for TAFE
and private providers). There is a view that this will put greater pressure on TAFEs in
regional areas, potentially reducing the range of qualification options available to the
public. Instead, providers may focus more heavily on relatively popular courses with a
more sustainable enrolment base. It may also encourage some TAFEs to undertake more
on-site assessments, potentially reducing the quality and rigour of the assessment process.
BICCIAB also advises of some ongoing consequences of the introduction of the VTG. For
example, BICCIAB noted that the VTG requires mature age students (older than 20 years) to
pay full fees in order to complete a pre-apprenticeship if they have already completed their
Year 12 education, as both are considered Certificate II level qualifications.
An increase in fees for apprentices in 2012 will also have a significant impact as many
apprentices struggle financially. BICCIAB has noted that some employers will cover the cost
for their apprentices.
The changing workforce employment structure in the building and construction industry
also has implications for skills. The hiring of migrants on short term contracts in the
industry is becoming more common. However, in some instances, the hiring of migrant
workers as sub-contractors rather than employees may be occurring in a deliberate
attempt to circumvent employer responsibilities. This discourages the hiring and training of
apprentices to the detriment of the domestic skills base. BICCIAB noted that one potential
solution would be to promote group training of apprentices, allowing the costs of taking on
an apprentice to be shared among employers.
Issues around the ongoing role of Competency Based Completion (CBC) in the industry
were also raised by BICCIAB as a change driver for 2012.
CBC requires training providers to have contact with the apprentice’s employer four times
per year. At these contact points the employer is required to confirm the individual’s
competency (as determined by the TAFE). CBC creates an opportunity for an apprentice to
be signed off prior to the usual three of four year training contract. This signals an early
completion for an apprentice’s training, but does not necessarily correlate with their wage
progression.
As such, BICCIAB advises that the monitoring of CBC assessment and the progression of
apprentices could be improved to ensure the system operates effectively and with the
confidence of employers and industry.
Deloitte Access Economics
26
2012 ITAB Market Effectiveness Report
Finally, the need for small business skills and soft skills may help to reduce the number of
small businesses failing in the industry. BICCIAB does not believe that small business skills
should be taught as a unit within apprenticeships or other trade-specific qualification
frameworks. However qualified workers in the industry should be encouraged to obtain
these skills through post-qualification learning opportunities.
Industry outlook
The outlook for building and construction is solid, though there are a number of important
challenges facing the industry at present.
Recent years have seen construction activity boosted by the Federal Government’s
economic stimulus spending, primarily through non-residential building programmes such
as Building the Education Revolution. Since 2010 however, as the effects of stimulus began
to fade, construction activity has taken a hit. Between June 2010 and June 2011,
completed building works fell by 15% Australia wide, and 7.5% in Victoria.
That overall relative outperformance in Victoria has been supported by residential
construction in particular. Strong residential construction activity has been a theme of
Victoria’s economy over a number of years. Indeed, while Victoria accounts for a quarter of
the national population, and slightly less in terms of economic output, the State currently
provides 40% of new housing starts in Australia.
However, there are a couple of important clouds on the horizon. Population growth has
been a key driver of the relative strength of Victoria’s construction industry, particularly for
residential construction, and growth is now slipping back. That is being driven by a number
of factors, including the strength of the mining industry in States to the north and west
(drawing workers away from Victoria), as well as the recent cuts to Australia’s skilled
migration intake. The recent negative publicity surrounding the treatment of exchange
students is also contributing to a considerable drop off in student numbers.
Some sectors of non-residential construction have also weakened. It is worth noting, for
example, that approvals for office developments, traditionally one of the biggest
contributors to overall non-residential construction, remain considerably weak compared
to the peaks seen a few years ago.
This is contributing to a shortage of office space in the Melbourne CBD, with the Property
Council of Australia predicting vacancies over the next couple years will remain low. Those
low vacancies will contribute to higher rents and encourage further office development, but
it may be some time before that recovery begins to take shape.
Despite these challenges, Victoria’s building and construction industry may continue to
outperform growth in the rest of Australia, with residential activity remaining the key
driver. The prospect of lower interest rates over the coming year may also help to support
lending and provide a boost to construction over the next year.
Deloitte Access Economics
27
2012 ITAB Market Effectiveness Report
Chart 5.1: Employment outlook – Victorian building and construction industry
'000 persons
350
Forecast
Change on year earlier
15%
Forecast
300
10%
250
200
5%
150
100
0%
50
0
-5%
1998
2002
2006
2010
2014
1998
Victoria
Building and Construction
2002
2006
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
The chart below shows that skilled vacancies for tradespersons in the building and
construction industry (as measured by DEEWR’s Skilled Vacancy Index) fell back slightly in
2011 in line with both the Victorian average and the historical trend over the past decade.
Chart 5.2: Skilled Vacancy Index – Victorian building and construction industry
Index: 2000 = 100
450
More
vacancies 400
350
300
250
200
150
100
Fewer
vacancies
50
0
1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011
Victoria (Total)
Electrician
Carpenter and joiner
Plumber
Source: Commonwealth Department of Education, Employment and Workplace Relations
Overall, and as the charts above show, Deloitte Access Economics expects relatively strong
employment growth in Victoria’s building and construction industry over coming years,
including growth of around 4% in 2012.
Deloitte Access Economics
28
2012 ITAB Market Effectiveness Report
Occupations in demand and critical skill shortages
Response to 2011 critical skill shortages
Responses to critical skill shortage occupations previously identified for 2011 have been
implemented with varying degrees of success. Three occupations in the building and
construction industry were listed as being in critical shortage in 2011: project managers and
supervisors (commercial and domestic), gas appliance service technicians, and building
inspectors.
A number of responses to the shortage of project managers and supervisors are being
implemented. BICCIAB is actively participating in a newly established committee of
industry and training provider representatives tasked with examining ways to improve the
skills of project and site managers.
Industry also recognises the need to increase the supply of skilled project managers, and
the civil construction industry is promoting the Certificate IV in Building and Construction
(Site management). The occupation remains in shortage. BICCIAB advises that the
workforce is ageing, with retirements anticipated to add to skill shortage pressures over
coming years.
Since being raised as a critical skill shortage, an increase in the training of gas appliance
service technicians has occurred through PICAC. BICCIAB has been liaising with PICAC and
reports that a good number of enrolments exist. Although there are still episodes of high
demand (for example at peak periods such as the beginning of winter and in some regional
areas), the occupation is no longer in demand at present. It does, however, remain an
ongoing concern for industry.
The shortage of building inspectors remains a key concern for the industry. BICCIAB notes
that it has established the Building Surveying Training Working Group in conjunction with
the Building Commission. The group – which includes members from the private and
municipal building surveying industry, the Building Commission, training providers and
BICCIAB – met monthly through the latter half of 2011 to gather industry intelligence and
has submitted a training proposal to the Victorian Government for consideration.
Separately, the Australian Institute of Building Surveyors has been successful in regards to a
proposal to the National Workforce Development Fund, while the Building Commission has
been actively promoting a career as a building inspector or surveyor at secondary schools
around the State and has established a career website.
Occupations in demand and critical skill shortages in 2012
The tables below summarise the occupations in demand and experiencing critical skill
shortages in 2012. These occupation lists have been advised by BICCIAB and have been
determined following formal engagement with industry.
Overall, there is an increase in the number of occupations listed as in demand compared to
2011, though a relatively small proportion are also listed as experiencing a critical skill
shortage. A number of the occupations listed as in demand also appear on other lists of
skill shortages in the Australian and Victorian economies, including the National Skill Needs
List and the Victorian skill shortage list published by the Commonwealth Department of
Education, Employment and Workplace Relations. The list of occupations also correlates
with the advice of the relevant national Industry Skills Council (the Construction and
Deloitte Access Economics
29
2012 ITAB Market Effectiveness Report
Property Services Industry Skills Council), along with the Housing Industry Association and
Master Builders Association.
Occupations in demand from 2011 that are no longer included on the list include
draftspeople, which has been removed due to the downturn in commercial construction
activity.
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Civil construction labourer
Plant operator
Builder’s labourer (821111)
Earthmoving plant operator (721211)
Road construction (Asphalt)
Road roller operator (721915)
Paving plant operator (721913)
Bricklayer
Bricklayer (331111)
Project manager
Construction project manager (133111)
Estimator
Construction estimator (312114)
Air-conditioning and mech. services plumber
Air-conditioning and mech. services plumber (334112)
Project administration
Program or project administrator (511112)
Building surveyor / Building inspector
Building inspector (312113)
Bridge builder
Concreter (821211)
Pipe layer
Drainer (334113)
Sprinkler fitter and fire alarm / electronics specialist
Technicians and trades workers nec (399999)
Concreter
Concreter (821211)
Joiner (On-site installer)
Joiner (331213)
Fibrous plasterer (wall and ceiling lining)
Fibrous plasterer (333211)
Wall and floor tiler
Wall and floor tiler (333411)
Occupational health and safety advisor
Occupational health and safety adviser (251312)
Stonemason
Stonemason (331112)
Carpenter
Carpenter (331212)
Painter and decorator
Painting trades worker (332211)
Solid plasterer
Solid plasterer (333212)
Drainer
Drainer (334113)
Gasfitter
Gasfitter (334114)
Roof plumber
Roof plumber (334115)
Roof tiler
Roof tiler (333311)
Occupations experiencing a critical skills
shortage
Industry
title
Plant operator
ANZSCO classification
Road construction (Asphalt)
Road roller operator (721915)
Project manager
Paving plant operator (721913)
Construction project manager (133111)
Building surveyor / Building inspector
Building inspector (312113)
Estimator
Construction estimator (312114)
Deloitte Access Economics
Earthmoving plant operator (721211)
30
2012 ITAB Market Effectiveness Report
The table below outlines qualifications which are required for occupations experiencing a
critical skill shortage.
Qualifications required for occupations experiencing critical skill shortages
Occupation (Industry title)
Qualification
Plant operator
Road construction (Asphalt)
Certificate III in Civil Construction Plant Operations
Certificate III in Road Construction and Maintenance
Project manager
Certificate IV in Building and Construction (Building)
Certificate IV in Building and Construction (Site management)
Diploma of Building and Construction (Building)
Building surveyor / Building inspector
Diploma of Building Surveying
Advanced Diploma of Building Surveying
Estimator
Deloitte Access Economics
Certificate IV in Building and Construction (Estimating)
31
2012 ITAB Market Effectiveness Report
6 Business Services
Coverage: Accounting, Business Administration, Business Management,
Cleaning and Waste Management, Finance, Human Resources, Insurance, Legal
Administration, Marketing and Sales, Real Estate, Security, Shared – Business
Services.
Specific industry and business cycle drivers: Credit growth, interest rates,
corporate profits (this trio affects demand across the sector), housing and
commercial construction cycles (which affects demand for real estate agents
and architects).
Recent relative sectoral performance rating: Above average
Expected relative sectoral performance rating: Above average
Summary of ITAB advice and consultation
Market effectiveness
A number of examples of training market success and failure were reported by Business
Skills Victoria (BSV).
Examples of training market success include six Stimulating Training Demand Projects
which were funded by the Higher Education and Skills Group (formerly Skills Victoria)
through 2010 and 2011. The projects – which included a targeted focus on real estate,
finance and facility management along with broader customer contract and green skills –
were highly successful, resulting in the placement of around 500 people in training in
targeted industries.
The results exceeded training market targets for all projects and the benefits of training
promotion and skills deepening in these industries are expected to be ongoing. The
projects provided training for both new entrants and existing workers.
Recent work by BSV and the Royal Melbourne Institute of TAFE (RMIT) to promote
qualifications in the facility management industry represents a second example of training
market success. As facility management is an emerging industry, the existence of relevant
qualifications is not well understood by industry or the public.
BSV and RMIT conducted promotional activities to encourage take up of the Certificate IV in
Property Services (Operations) and Diploma of Property Services (Asset and Facility
Management). This work included targeting employers, networking through the Facility
Management Association and undertaking marketing at workshops and meetings. The
project was successful in raising awareness of training pathways in facility management.
A third example of success relates to the promotion of career pathways in the electronic
security industry. The electronic security industry incorporates a number of occupations,
including those situated in monitoring centres and control rooms along with higher level
jobs such as the installation of cabling. A number of lower skilled occupations would suit
Deloitte Access Economics
32
2012 ITAB Market Effectiveness Report
individuals currently outside the workforce, including university students and persons with
a disability.
The industry suffers from thin markets and a lack of properly developed and documented
career pathways. BSV developed occupational profiles describing jobs found in the industry
and promoted two key qualifications – the Certificate III in Technical Security and the
Certificate IV in Security and Risk Management. BSV has also been liaising directly with
training providers and employers and has raised the awareness of the industry.
A key theme across the examples of market failure provided by BSV was the link between
growing enrolments in specific qualifications and a reduction in training provider funding
for broader industry qualifications (via the relevant industry weighting).
This is most apparent in relation business services, property services and finance
qualifications. According to BSV, the sharp increase in business services enrolments in
recent years can be attributed to the Diploma of Management, which has seen government
funded enrolments rise from 267 in 2008 to 10,230 by the third quarter of 2011. Partly as a
result of this increase, the relevant industry weighting for business and clerical services
(which determines funding to training providers) has been reduced for 2012. In the view of
BSV, this will greatly disadvantage the broader sector and result in a decline in genuine
business training and the development of technical skills.
In property services, enrolments in the Certificate II and Certificate III in Security Operations
roles rose from 197 in 2008 to 3,750 by the third quarter of 2011. According to BSV, this
increase contributed to a reduction in the industry weighting for property services which is
expected to affect other qualifications in thin markets, including those related to electronic
security, pest management and facility management.
The increase in the take up of finance qualifications – including the Certificate IV in
Financial Services and the Certificate IV in Financial Services (Bookkeeping) – is meeting a
real industry need. However a reduction in the weighting for finance qualifications will
have implications for enrolments, including in accounting, which is currently experiencing a
critical skill shortage.
BSV notes that these issues could be avoided by applying relevant weightings at the course
level rather than the industry level.
A related market failure identified by BSV involves the dramatic increase in enrolments in
some qualifications. BSV believes that in some instances this represents an abuse of the
training market, with some training providers marketing short course training directly to
employers. These courses are often funded through the Victorian Training Guarantee
though in some cases do not meet training hours or unit of competency requirements.
BSV believes more careful monitoring of training providers needs to occur in an effort to
identify those offering sub-par training.
Change drivers and industry developments
Advice from BSV is that the following major change drivers are expected to affect the
business services industry in 2012:

Globalisation (demand side)
Deloitte Access Economics
33
2012 ITAB Market Effectiveness Report

Environmental sustainability (demand side)

Economically induced industry restructure (supply side)

Ageing population (supply side)
These change drivers have been raised by BSV over a number of years, and are expected to
remain relevant through 2012.
The impact of globalisation and general economic conditions is an ongoing issue for
industry. With operations increasingly conducted on an international level, business
services firms are reporting a growing need for individuals to be aware of the global
environment for their product or service and stay up-to-date with industry developments
and regulations.
In the financial services sector, that includes being across changes to Australian accounting
standards, which are moving in line with international reporting standards, as well as
upskilling as the regulatory environment changes (for example in relation to financial
planning and insurance).
BSV advises that the changing economic conditions are having implications for skills in the
real estate sector. The recent weak market performance is requiring a greater focus on
marketing rather than business processes as the industry tries to counter soft demand.
The increased focus on environmental sustainability is creating skill requirements across
the industry. In business services, skills and knowledge of corporate social responsibility,
triple bottom line accounting and environmental social governance are required, with an
emphasis on integrating these issues into the overall business performance. A related
emerging skill is carbon accounting, which will become necessary with the introduction of
the Federal Government’s carbon tax from 1 July 2012. Specific units in carbon accounting
are already offered at Swinburne (which also offers a Diploma of Carbon Management),
with other training providers are also expected to offer training in carbon accounting going
forward. The carbon tax is also expected to create opportunities for auditors, financial
analysts and accountants, and is expected to expand the scope of accounting professions.
Environmental sustainability is also relevant in other sectors, including waste management
(where skills have shifted to waste minimisation and waste avoidance in line with broader
aspects of sustainability), in real estate (with an increased focus on energy efficiency and
sustainability to meet buyers’ expectations), and in facility management (where knowledge
of the five star Victorian building standard and tools to present the case for green buildings
are required).
The incidence of economically induced restructure continues to be present in the industry,
driven by strong demand growth over time and a number of regulatory and other changes.
Small and medium enterprises account for a significant proportion of the industry allowing
for relatively rapid adoption of new technology, with the use of social media beginning to
emerge for advertising and other purposes.
Other examples of change in the industry cited by BSV include an overhaul of the financial
planning sector by the Federal Government, including in relation to conflicts of interest,
transparency, duty to clients and models of fee generation, and the Cooper review of
Deloitte Access Economics
34
2012 ITAB Market Effectiveness Report
superannuation. Both of these changes will have implications for industry structure and
underscore the need for skills around flexible business practices and business management.
BSV also noted the deep awareness of population ageing in the industry. The workforce
represents a broad cross section of the Australian population, and an increase in
retirements is anticipated over coming years.
That trend may be felt more acutely in electronic security and waste management. These
occupations are struggling to attract new, younger entrants into positions, possibly because
of a lack of understanding regarding the industry or minimal opportunity for career
progression. BSV is assisting to promote careers in both sectors in conjunction with training
organisations and industry bodies such as the Australian Security Industry Advisory
Association and the Waste Management Association of Australia. In regards to electronic
security, BSV is also assisting the sector to promote employment opportunities generated
by the National Broadband Network.
Accounting is also experiencing the effects of population ageing. With accountants already
listed on the Skilled Occupation List for migration, an increase in retirements in the years
ahead will further exacerbate the shortage of qualified workers.
Industry outlook
Most components of the Victorian business services industry have performed relatively
strongly in recent years, despite the impact of the global financial crisis. The financial
services sector is one exception, with the sector struggling in 2009 in particular, and
difficulties have again been evident more recently.
Indeed, there has been some significant global consolidation in the financial services sector.
In Australia this has been most visible in the absorption of a number of regional banks. In
the wake of the Cooper Review, new laws have come into place governing financial
transactions, and further reforms are in train.
Credit growth has returned, but it is still modest, and it has not, and likely will not, return to
pre-financial crisis growth rates. That said, the finance and insurance sector is struggling to
maintain profitability, and significant job losses have already occurred across some major
employers. That will weigh on the employment outlook for the broader business services
industry through 2012.
The property services sector has also had a tough time. Susceptibility to rising finance costs
and fluctuations in asset prices saw it fare badly in the wake of the global financial crisis.
However, as Australian businesses have regained confidence and financing costs have
eased the sector has begun to recover. Moreover, a potential downward bias in the future
direction of interest rates may also help to support further recovery in house prices, which
would be a positive for this sector.
Strong rates of dwelling construction in Victoria have also been a boon for the property
services sector. That growth is expected to slow somewhat over the medium term,
however, due to easing population growth.
A number of other professional services sectors, such as accounting, legal services and
advertising and marketing professionals have seen a reduction in demand recently. Some
Deloitte Access Economics
35
2012 ITAB Market Effectiveness Report
large services firms have noted low utilisation levels, and in some cases actively reduced
employment.
That trend is not expected to be widespread or long lasting, with the relatively strong
outlook for the Australian (and Victorian) economies expected to support business
confidence and spending on professional services.
Chart 6.1: Employment outlook – Victorian business services industry
'000 persons
500
450
400
350
300
250
200
150
100
50
0
1998
Forecast
Change on year earlier
10%
Forecast
8%
6%
4%
2%
0%
-2%
Victoria
-4%
2002
2006
2010
2014
1998
2002
Business services
2006
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
Indeed, as the chart below showing skilled vacancies for certain occupations in the
Victorian business services industry suggests, vacancies for legal professionals, accountants
and auditors, and marketing professionals remain low, having decreased further in 2011.
Given some of the difficulties expected to face the broader industry through 2012 and the
projected weaker labour demand, vacancies may fall further over the short term.
Deloitte Access Economics
36
2012 ITAB Market Effectiveness Report
Chart 6.2: Skilled Vacancy Index – Victorian business services industry
Index: 2000 = 100
200
More
180
vacancies
160
140
120
100
80
60
40
20
Fewer
vacancies
0
1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011
Victoria (Total)
Accountants and auditors
Marketing professionals
Legal professionals
Source: Commonwealth Department of Education, Employment and Workplace Relations
Overall the business services industry is comprised of many different sub-sectors.
Employment in the broader industry is expected to contract in 2012, dragged down by
difficulties in the financial sector in particular, before a recovery commences in 2013.
Occupations in demand and critical skill shortages
Response to 2011 critical skill shortages
Responses to critical skill shortage occupations previously identified for 2011 are being
implemented in the business services industry. Four occupations in the industry were listed
as in critical shortage in 2011: accounting, waste management drivers, waste management
operators and sustainability assessors.
Although higher education is the preferred pathway for the accounting profession, the VET
sector can play an important role. BSV has been actively raising industry awareness during
consultations and at career forums regarding VET qualifications that can lead to
paraprofessional accounting roles. BSV has also been promoting cooperation between VET
and higher education providers and identifying key training requirements in the industry
such as around announced changes in financial planning and issues relating to carbon
accounting and emissions training.
According to BSV, the contribution that can be made by VET graduates is being increasingly
acknowledged by industry. The occupation remains in critical shortage and firms continue
to seek suitably qualified accountants from overseas. The occupation remains on the
Skilled Occupation Lists for migration.
Deloitte Access Economics
37
2012 ITAB Market Effectiveness Report
BSV reports considerable difficulty attracting individuals to vacancies in the waste
management industry. Waste management drivers remain in critical shortage despite
larger employers offering relatively good wages and conditions in an effort to attract skilled
workers. There is widespread recognition that the job is ‘not for everyone’, and the long
lead time in training is exacerbating the shortage. Moreover, the existing workforce is
ageing (BSV reports that most drivers are aged 50 or over), and the issue is expected to
worsen over the medium term.
However, waste management operators are no longer listed as experiencing a critical
shortage. BSV notes that there remains an issue of labour shortage, and the industry still
finds it difficult to attract workers given relatively low wages. However the issue for the
occupation could be characterised as a labour shortage rather than a skill shortage.
The shortage of sustainability assessors remains a concern. BSV has been raising
awareness at career forums that national qualifications are now available, and has been
promoting the update of the Certificate IV in Home Sustainability Assessment. A number of
training providers in Victoria now offer this course, and BSV believes that despite being
relatively new, the industry is gaining momentum. As the qualifications required by
industry now exist, the issue is now one of promotion and broadening community
understanding about the role of the industry.
Occupations in demand and critical skill shortages in 2012
The tables below list the occupations in demand and experiencing critical skill shortages in
2012. These occupation lists have been advised by BSV and have been determined
following formal engagement with industry and other stakeholders.
Consistent with the similar range of issues expected to affect the industry in 2012, the list
of occupations is similar to those nominated in 2011.
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Accounting
Bookkeeping
Accountant (General) (221111)
Bookkeeper (551211)
Managers
Corporate services manager (132111)
Legal administration officers
Legal secretary (521212)
Project managers
Law clerk (599214)
Program or project administrator (511111)
Waste management drivers
Recycling or rubbish collector (899611)
Waste management operators
Machine operators nec (711999)
Sustainability assessors
Environmental manager (139912)
Real estate agents
Real estate agent (612114)
Property developers
Property manager (612112)
Facility managers
Facilities manager (149913)
Security control room and monitoring centre operators
Alarm, security or surveillance monitor (442211)
Deloitte Access Economics
38
2012 ITAB Market Effectiveness Report
Occupations experiencing a critical skills shortage
Industry title
ANZSCO classification
Accounting
Accountant (General) (221111)
Waste management drivers
Recycling or rubbish collector (899611)
Sustainability assessors
Environmental manager (139912)
The table below outlines qualifications which are required for occupations experiencing a
critical skills shortage.
Qualifications required for occupations experiencing critical skill shortages
Occupation (Industry title)
Qualification
Accounting *
Certificate IV in Accounting
Diploma of Accounting
Advanced Diploma of Accounting
Waste management drivers
Certificate III in Asset Maintenance (Waste management)
Certificate IV in Asset Maintenance (Waste management)
Sustainability assessors
Certificate III in Asset Maintenance (Waste management)
Certificate IV in Asset Maintenance (Waste management)
Certificate IV in Home Sustainability Assessment
* A preferred pathway is higher education.
Deloitte Access Economics
39
2012 ITAB Market Effectiveness Report
7 Community Services and Health
Coverage: Children’s Services, Community Health, Community Support, Health
Sciences and Acute Care, Medical Practitioners, OH&S Professionals, Other
Health Professionals, Psychologists, Residential Aged Care and Home and
Community Care, Nursing Professionals.
Specific industry and business cycle drivers: Government policy (including
subsidies), ageing of the general population, the rate of retirement and/or
shifts to different occupations among nurses (affects gross demand for new
workers), increased consumer awareness and expectation, extent and nature
of government subsidies to child care and measures to promote workforce
participation among mothers (affects child care demand).
Recent relative sectoral performance rating: High
Expected relative sectoral performance rating: High
Summary of ITAB advice and consultation
Market effectiveness
A number of examples of market effectiveness were provided by the Community Services
and Health Industry Training Board (CS&H ITB). Only one example of success was provided,
in relation to a training needs analysis for Aboriginal health workers. The failures, on the
other hand, generally related to thin markets and training quality.
A training needs analysis was conducted with the participation of Rumbalara, an Aboriginal
health and welfare organisation based in North-Eastern Victoria. The analysis focused on
the training needs of Aboriginal health workers and was partially funded by the Higher
Education and Skills Group (formerly Skills Victoria). The program also involved actively
pursuing relevant training for the health workers involved in the study, after skills gaps had
been identified.
An increase in training place numbers for children’s and aged care services can be
considered an example of market success. In the area of child care, these training places
are required by the industry given it will be mandatory for children’s services workers to be
qualified with either a Certificate III or Diploma in Children’s Services by the end of 2013.
As a result, training numbers have increased from 16,632 in 2010 to almost 22,000 in 20111,
with much of this done through recognition of prior learning (RPL). However, there is a
capacity constraint within the training sector to provide a sufficient number of skilled
assessors.
In the aged care sector training numbers are also up, from 6,403 in 2010 to 8,327 in 2011
for the Certificate III in Aged Care and Certificate III in Aged Care Work. This results from a
1
This represents total enrolments in the Certificate III in Children’s Services and the Diploma of Children’s
Services (including the early childhood education and care and the outside school hours care specialisations).
Deloitte Access Economics
40
2012 ITAB Market Effectiveness Report
general demand for qualified aged care workers and an increasingly large number of
Victorians ‘ageing in place’. However, the industry has reported that graduates are not
work-ready. This may be due to capacity constraints in the regulation of quality of training
as there is such a high volume of student turnover and a large number of training providers.
An expected shortage of clinical placements for those undertaking a nursing qualification
will cause significant problems for the training industry next year. Clinical placements are a
core requirement for completion of nursing qualifications and a shortage will restrict
completion of training. This problem has been building for a number of years, but CS&H ITB
expects that there will be a peak shortfall of between 500 and 600 clinical placements for
nursing students State-wide in 2012. CS&H ITB has been funded to develop a common
assessment tool to assist with nursing placements (as described later in this chapter).
The CS&H ITB reported a shortage of Allied Health workers in regional Victoria. This is not
specific to any particular area of the State, but is a general issue around regional Victoria.
This problem is not attributed to the availability of training courses, but as a result of thin
markets for employment given the relatively low population base and high degree of
turnover among these workers.
Change drivers and industry developments
CS&H ITB reported a number of change drivers for 2012 that were identified during
consultations with industry stakeholders. These are supply and demand side issues
associated with changes in public policy:

National case-mix funding (demand side)

National approach to childcare qualifications (demand side)

State Government Inquiry into Child Protection (supply side)

Fees and funding changes (supply side)
All jurisdictions in Australia will be moving to case-mix funding for health care, while
Victoria has used this system since 1994. Case-mix funding involves the allocation of funds
on the basis of how patients are coded. As such, there is a requirement for staff trained in
clinical coding and health information management. It is predicted that nationally there
will be a shortage of approximately 600 qualified staff over the next five years. While
Victoria has a large number of suitably qualified staff already, a shortage is still expected
here as some staff retire and others are lured away to other jurisdictions.
A national approach to childcare qualifications is resulting in a significant increase in the
number of enrolments for training in children’s services (as discussed in the market
effectiveness section above).
A State Government Inquiry into Child Protection has been conducted, with outcomes and
an internal review by the Department of Human Services (DHS) to be made public. The
outcomes may imply a program for reform, with the potential combination of the
Certificate III and IV into a generic qualification for the healthcare sector. The idea is to
move towards client-centred services with a flexible workforce that is able to move
between different sub-sectors, such as child care, aged care and child protection. The
proposed changes would aim to provide a broader set of skills as required by the
workforce.
As a result of the proposed changes to fees and funding in 2012 in relation to the
differential in funding between private and public providers, it is expected there will be a
Deloitte Access Economics
41
2012 ITAB Market Effectiveness Report
reduction in the number of courses available at public institutions. CS&H ITB reports that
one TAFE provider has already decided not to offer one of their courses in 2012 as a result
of these changes. Overall, this may lead to a reduction in the availability of training,
particularly in those courses which were marginal due to low levels of demand or high costs
of provision.
Industry outlook
The community services and health industry represents an essential service and is generally
less affected by cycles in the broader economy. The industry’s output has been steadily
increasing over the past two decades, and has rapidly increased as a share of the Victorian
economy.
Employment in the Victorian community services and health industry has also been growing
strongly, and now accounts for more than 300,000 workers. Over the last decade, the
average annual employment growth in the industry has been almost double the Victorian
rate of 2.4%.
Moreover, the outlook for the industry is also very healthy. Demographics are a key driver
of growth, particularly for the health and aged care components of the industry. The
growing and ageing Australian population is expected to underpin demand for health
services, both through the impact of a larger demand base and the occurrence of more
complex health conditions and co-morbidity.
Victoria’s population growth has eased over the past two years due to a number of factors,
including the strength of the mining industry in States to the north and west (drawing
workers away from Victoria), as well as the recent cuts to Australia’s skilled migration
intake. The recent negative publicity surrounding the treatment of exchange students is
also contributing to a considerable drop off in student numbers.
Employment outlook – Victorian community services and health industry
'000 persons
400
Forecast
Change on year earlier
10%
350
8%
300
6%
250
4%
Forecast
2%
200
0%
150
-2%
100
-4%
50
-6%
0
-8%
1998
2002
2006
2010
2014
1998
Victoria
Community services
2002
2006
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
That said, solid population growth of around 1.5% per year is expected in Victoria, and the
demographic changes are expected to increase demand for health services in general, and
hospital and aged care services in particular over the longer term.
The supply side of the sector continues to face some uncertainty. The recently released
Productivity Commission report, Caring for Older Australians, recommended a number of
Deloitte Access Economics
42
2012 ITAB Market Effectiveness Report
changes to the aged care sector in Australia, including in relation to skill development and
the VET system, which are currently being considered by the Federal Government.
Meanwhile, the Council of Australian Governments has recently agreed to the National
Health Reform Agreement which increases Federal Government funding of the health
sector in Australia while also introducing a series of reform measures.
Skilled Vacancy Index – Victorian community services and health industry
Index: 2000 = 100
600
More
vacancies
500
400
300
200
100
Fewer
vacancies
0
1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011
Victoria (Total)
Nursing professionals
Medical practitioner
Source: Commonwealth Department of Education, Employment and Workplace Relations
The chart above shows that skilled vacancies for some workers in the Victorian community
services and health industry (as measured by DEEWR’s Skilled Vacancy Index) remained
relatively steady in 2011.
Overall, employment growth in Victoria’s community services and health industry has been
solid in recent years, supported by an expansion of the aged care and broader health
sectors. As the charts above show, Deloitte Access Economics expects relatively strong
employment growth in the industry over coming years. After growing by close to 8% in
2011, employment growth in the community services and health sector is expected to
remain solid over the medium term.
Occupations in demand and critical skill shortages
Response to 2011 critical skill shortages
A number of actions have been taken by CS&H ITB and the industry in response to critical
skills shortages listed for 2011. Nonetheless, all occupations experiencing critical skills
shortages in 2011 remain on the list for 2012.
In response to the critical shortage of aged care workers, Aged and Community Care
Victoria (ACCV) has pursued a number of strategies. One of these involved active
engagement with the training sector. After successfully obtaining funding, the ACCV
undertook an aged care nurse graduate program in partnership with Monash University.
Deloitte Access Economics
43
2012 ITAB Market Effectiveness Report
This allows first and second year registered nursing graduates to take up employment with
ACCV members, while at the same time being supported by a tailored education program.
In response to the critical shortage of enrolled nurses, a common assessment tool has been
developed by CS&H ITB. This tool provides a framework for assessment of placements,
based on identification of common requirements for placement completion. Due to a lag in
the effect on skills shortages, no impact can yet be identified. However the tool has been
positively received and there are moves to roll it out nationally.
The common assessment tool facilitates completion of the qualification. It is important
because existing clinical placement templates predominately service the higher education
sector. VET courses have different regulatory requirements to higher education courses,
resulting in greater supervisory requirements being placed on the health service provider
for VET placements. The common assessment tool assists to reduce this burden and is
therefore expected to help to increase clinical placement numbers.
The CS&H ITB has been working with DHS to address the skills shortage in community care
workers. This involved a ‘goal-directed care planning’ project to deliver competencies to
the health workforce, including home and community care workers. This project focuses
on workers in Primary Care Partnerships, who can receive subsidised training in a study unit
of goal-directed care. This covers a wide range of workers, including doctors, allied health
workers and administrative staff. The resulting effect on health outcomes is expected to
materialise in the near future.
Occupations in demand and critical skill shortages in 2012
The table below summarises those occupations cited as being in demand and those
experiencing critical skill shortages in 2012, based on advice provided by CS&H ITB. These
occupation lists were determined by CS&H ITB following formal engagement with industry.
All occupations in demand are also considered skills shortages, and the list remains the
same as in 2011.
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Aged care workers
Enrolled nurses
Aged or disabled carer (423111)
Enrolled nurse (411411)
Children’s services workers
Child care worker (421111)
Child protection workers
Family support worker (411713)
Welfare worker (272613)
Disability services workers
Disabilities services officer (411712)
Community care workers
Community worker (411711)
Occupations experiencing a critical skills shortage
Industry title
ANZSCO classification
Aged care workers
Aged or disabled carer (423111)
Enrolled nurses
Enrolled nurse (411411)
Children’s services workers
Child care worker (421111)
Child protection workers
Family support worker (411713)
Welfare worker (272613)
Deloitte Access Economics
44
2012 ITAB Market Effectiveness Report
Disability services workers
Disabilities services officer (411712)
Community care workers
Community worker (411711)
The table below outlines qualifications which are required for occupations experiencing a
critical skills shortage.
Qualifications required for occupations experiencing critical skill shortages
Occupation (Industry title)
Qualification
Aged care workers
Certificate III – Aged care
Certificate III – Home and Community Care
Certificate IV – Home and Community Care
Certificate IV – Nursing
Certificate IV – Allied Health Assistance
Diploma – Nursing for (a) new entrants and (b) existing workers
Enrolled nurses
Certificate IV – Nursing
Certificate IV – Allied Health Assistance
Diploma – Nursing for (a) new entrants and (b) existing workers
Children’s services workers
Certificate III – Children’s Services
Diploma – Children’s Services (Early Childhood Education and
Care)
Diploma – Children’s Services (Outside School Hours Care)
Child protection workers
Vocational Graduate Certificate – Community Services Practice
(Statutory
protection)
Certificate child
IV – Child,
Youth and Family Intervention (Residential
and out of IV
home
care)Youth and Family Intervention (Child
Certificate
– Child,
protection)
Certificate IV – Child, Youth and Family Intervention (Family
Disability services workers
support)
Certificate IV – Disability
Diploma – Disability
Advanced Diploma – Disability
Community care workers
Certificate IV – Community Service (Alcohol and other drugs)
Certificate IV – Community Service (Mental health)
Diploma – Community Service (Alcohol and other drugs)
Diploma – Community Service (Mental health)
Diploma – Community Service (Alcohol, other drugs and mental
health) – Community Service (Case management)
Diploma
Diploma – Community Services Coordination
Advanced Diploma – Community Sector Management
Vocational Graduate Diploma – Community Sector Management
Vocational Graduate Certificate in Community Services Practice
(Client assessment and case management)
Deloitte Access Economics
45
2012 ITAB Market Effectiveness Report
8 Culture and Recreation
Coverage: Arts and Design, Entertainment, Recreation, Shared – Culture and
Recreation
Specific industry and business cycle drivers: $A exchange rate, interest rates.
petrol prices, extent of competition among domestic airlines, government
spending (affects extent of staging of cultural events), and consumer spending.
Recent relative sectoral performance rating: Above average
Expected relative sectoral performance rating: Average
Summary of ITAB advice and consultation
Market effectiveness
A number of examples of market effectiveness were provided by SkillsHub in terms of both
successes and failures. The successes generally relate to increases in training in response to
skill needs, while the failures relate to low take-up rates and thin markets.
The obtainment of formal qualifications in technical production for 60 staff at the
Victorian Arts Centre through RPL is an example of a market success. Innovation and
Business Skills Victoria and SkillsHub have been assisting the Victorian Arts Centre to access
the VTG as well as funding available under the National Workforce Development funding
program in order to obtain these qualifications for their staff and meet current workplace
health and safety requirements.
There has been success in qualifying 30 industry professionals in a Diploma of Screen
Media, customised for Screen Safety Officers, in order to meet requirements under new
WorkSafe requirements for 2012. This has been done through consultations with the
Media Entertainment and Arts Alliance. SkillsHub has provided advice and assistance to a
New South Wales RTO that is a specialist provider in occupational health and safety for the
screen industry to deliver training in Victoria. This qualification is currently being offered by
only one training provider, through a combination of RPL and training. Single units are also
delivered to both screen and advertising businesses in order to meet the new regulatory
requirements.
Training for library technicians has increased since the skill reforms, with full demand
reached for most existing courses and a new course commencing at one RTO. Library
technician skills are in demand across a range of sectors, with the number of librarians
increasing by 5% over the past five years. This increase in training will help to address any
potential skills shortages that are largely the result of an ageing workforce.
Outdoor adventure instructors were listed as a critical skills shortage in 2011 and training
in this area has increased as a result of the Home Grown outdoor recreation project. The
training has focused on building skills for leadership and management positions, with a
doubling of qualifications in the Certificate IV and Diploma, as well as traineeships. This
Deloitte Access Economics
46
2012 ITAB Market Effectiveness Report
could be considered a market success. However, SkillsHub reports that this increase in
training may have been met by the entry of new providers in the market with questionable
training quality and job outcomes for students. On the whole, very high quality training has
been provided, though a small number of unscrupulous providers have been exploiting the
training system, leading to restrictions on training despite an ongoing skill need.
There have been difficulties in securing traineeships in the area of digital interactive
media, in order to meet current and expected future high levels of demand for these skills.
It is reported that the level of training has increased. However, on the job training through
traineeships has been difficult to secure. Under the Game Plan project the target of an
additional 25 digital media graduates was not realised, but a total of 24 additional students
and trainees were placed (with three of these positions being traineeships). There is a
misalignment of incentives due to the regulations concerning traineeship funding and
wages versus the level of qualification required by the industry for entry. SkillsHub reports
that an Advanced Diploma is the entry level requirement for the industry, but this does not
attract a training wage. Furthermore, employers are not eligible for the Federal traineeship
incentive if they take on an Advanced Diploma trainee who has already completed a
Diploma.
An initiative of SkillsHub in 2011 was to work in partnership with Swinburne University to
offer free RPL of skills for 20 volunteers in the Victorian Country Football League Club.
None of these volunteers took up the offer. The Skills for Growth program, which identified
volunteers in other areas, has likewise not been successful in engaging volunteers to
undertake formal qualifications. This may be because the volunteers perceive that a
qualification is not necessary to continue their work, or an inability to link volunteering
skills with other employment and training pathways.
Change drivers and industry developments
SkillsHub reported a number of change drivers for 2012 that were identified during
consultations with industry stakeholders, affecting both the demand and supply side for the
cultural and recreation industries:

Greater focus on preventative health (demand side)

High Australian dollar (demand side)

National Broadband Network (demand side)

New WorkSafe regulations (supply side)
As a result of the greater focus on preventative health in Australia (arising from increasing
obesity levels and related health conditions), the recreation industry is attempting to
expand participation, as this is often linked to funding arrangements. In order to
implement such strategies, people working in recreation require higher level management
skills and specialist skills allowing them to work with people at risk. The Diploma of Fitness
in the new SIS10 training package addresses the skill needs required to work with people at
risk.
A high Australian dollar has negative implications for the games industry which relies
heavily on exports. A large number of Victorian gaming businesses have closed down over
the last 12 months as a result. People with skills in this sector, such as design, programming
and production management skills, may find they are able to transfer those skills to other
areas. Remaining games design businesses require skills training in intellectual property
and contract management to better enable them to retain their intellectual property and
Deloitte Access Economics
47
2012 ITAB Market Effectiveness Report
profits. SkillsHub notes that new policies are being considered that are similar to the
incentives currently on offer to the film and television industry. This will likely boost games
production in the near future and a skills base will be necessary to compete internationally.
The development of the National Broadband Network continues to be a change driver for
the cultural industry. Overall, there will be greater demand for skills in developing online
applications, social marketing and interactive media. In particular, skills in content creation,
content management and content distribution will be required across a range of industries.
The Federal Government is proposing ‘Arts Ready’ traineeships to address these skills gaps
in regional areas.
On the supply side, the new WorkSafe regulations will continue to have an impact across
the cultural and recreation industries in 2012. This will require appropriate training of all
employees and volunteers in occupational health and safety (OH&S). Development of
licensed units is essential to ensure all graduates have appropriate OH&S training. To date
the Music, Screen Media and Entertainment training packages have been updated with
these units.
SkillsHub also reports that there is a continued shortage of fitness, aqua and community
recreation instructors, particularly in regional Victoria. A key reason for this shortage is the
high level of turnover within the industry. Training in fitness has increased four-fold
recently, which may help to address the skills shortage. However, the industry still has
concerns that, due to the high turnover rate, a large proportion of these will not stay in the
industry long-term.
Industry outlook
The Victorian culture and recreation industry has accounted for a growing share of the
Victorian economy over time. After an apparent dip in 2010, employment in the culture
and recreation industry recovered strongly in 2011 and now represents almost 65,000
workers.
The increase in discretionary spending by households in recent years has been a key reason
behind the lift in the industry’s relative strength over time. Indeed, spending on ‘luxuries’
such as recreational activities is an important driver of growth for cultural and recreational
employment.
The industry will benefit from a general trend for services to account for a larger share of
household spending over time. The latest Household Expenditure Survey released by the
ABS shows that, Australia wide, total weekly expenditure by households rose by 38.5% over
the six years to 2009-10, while spending on recreational services rose by 40.8%.
Discretionary spending by households is also expected to grow solidly over the medium
term, with solid employment and wage growth both likely to underpin good gains in
household income. Moreover, the prospect of lower interest rates over the coming year
may also help to support spending growth, including on recreational services.
The health of the domestic and international tourism sectors is also important to growth in
the culture and recreation industry. At present, some notable challenges are affecting the
outlook for tourism. In particular, the elevated exchange rate is discouraging international
visitors from coming to Australia and encouraging Australians to holiday overseas.
Deloitte Access Economics
48
2012 ITAB Market Effectiveness Report
Employment outlook – Victorian culture and recreation industry
'000 persons
70
Forecast
Change on year earlier
25%
Forecast
20%
60
15%
50
10%
40
5%
0%
30
-5%
20
-10%
10
-15%
0
-20%
1998
2002
2006
2010
2014
1998
Victoria
Culture and recreation
2002
2006
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
The recent disruptions to travel services caused by industrial disputes in the aviation sector
have also posed significant challenges, though some certainty in the area has now been
achieved.
On the supply side, some sectors of the industry (particularly sporting activities) remain
highly reliant on a volunteer workforce which poses challenges for skill acquisition and
retention of workers (SkillsHub notes that this is exacerbated by the lack of a funding
mechanism to address the issue of skills for volunteers, which remains a critical issue for
the culture and recreation sectors).
Overall Deloitte Access Economics expects employment in the sector to remain relatively
steady in 2012, with modest rates of growth over the medium term.
Occupations in demand and critical skill shortages
Response to 2011 critical skill shortages
A number of actions have been taken by SkillsHub and the industry in response to critical
skills shortages listed for 2011. Three occupations were listed as critical skills shortages for
2011 and only outdoor adventure instructors are still listed as a critical skills shortage for
2012.
As described in the market effectiveness section, skills shortages for outdoor adventure
instructors have been addressed with mixed success through the Home Grown project. In
addition to this program, SkillsHub has also completed a Victorian Outdoor Industry
Workforce Development Strategy. Industry has almost doubled the number of traineeships
available and it has met to discuss recommendations in relation to government funding
cuts to recreation.
In response to the skills shortage for digital broadcast technicians, which is due to an
ageing workforce and high incidence of freelancers, SkillsHub has pursued two main
actions. The first of these was a project on behalf of Innovation and Business Skills
Australia to address the requirements resulting from changes to OH&S regulation in the
screen media industry. The second has been a long term project, Making it Reel, where
SkillsHub has worked on improving vocational pathways in the industry over the last three
years, with a particular emphasis on traineeships. SkillsHub reports that traineeships in the
sector are now increasing.
A critical skill shortage for games designers was reported for 2011 and SkillsHub responded
with a proposal to stimulate demand for training. It was successful in securing pledges by
Deloitte Access Economics
49
2012 ITAB Market Effectiveness Report
businesses to take on trainees. However, as a result of the high $A, a number of Victoria’s
major games businesses closed down. During the project period and there was limited
uptake of traineeships, with 3 traineeships secured out of a planned 10 to 15. The project
led to a total of 24 out of a proposed 25 placement target with the majority of training
being delivered in the classroom but tailored to specific industry needs.
Occupations in demand and critical skill shortages in 2012
The table below summarises those occupations cited as being in demand and those
experiencing critical skill shortages in 2012, based on advice provided by SkillsHub. These
occupation lists were determined by SkillsHub following formal engagement with industry.
The number of occupations in demand and the number experiencing critical skill shortages
have both increased from 2011.
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Sports and recreation
Swimming coach / Aqua instructor
Swimming coach or instructor (452315)
Lifeguard
Lifeguard (452414)
Sports coach / Instructor
Other sports coach or instructor (452317)
Fitness instructor
Fitness instructor (452111)
Sports development officer / Sports
administrator
Sports development officer (452321)
Amusement, fitness and sports centre
manager
Sports umpire
Amusement centre manager (149111)
Volunteer coordinator
Diversional therapist (411311)
Outdoor recreation guide / Instructor
Outdoor adventure instructor (452215)
Outdoor recreation assistant
Outdoor adventure instructor (452215)
Outdoor program manager
Outdoor adventure instructor (452215)
Sports administrator (139915)
Sports umpire (452322)
Arts and culture
Arts Administrator / Manager
Arts administrator or manager (139911)
Camera operator (film, television, or
video)
Cinema theatre/facilities manager
Camera operator (film, television, or video) (399512)
Community cultural development officer
Community arts worker (272611)
Games developer/Animator/Special
effects
Illustrator
Multimedia designer (232413)
Library technician/assistant
Library technician (399312)
Cinema or theatre manager (149912)
Illustrator (232412)
Library assistant (599711)
Lighting technician
Light technician (399513)
Multi/New/Interactive media designer
Multimedia designer (232413)
Multimedia specialist and web developer
Multimedia specialist (261211)
Web developer (261212)
Performers (Dancers)
Dancer or choreographer (211112)
Performers (Circus Theatre)
Entertainer or variety artist (211113)
Post-production media technician
Production assistant (film, television, radio or stage) (599912)
Deloitte Access Economics
50
2012 ITAB Market Effectiveness Report
Occupations experiencing a critical skills
shortage Industry title
ANZSCO classification
Sports and recreation
Swimming coach / Aqua instructor
Swimming coach or instructor (452315)
Lifeguard
Lifeguard (452414)
Arts and culture
Camera operator (film, television, or video)
Cinema theatre/facilities manager
Camera operator (film, television, or video)
(399512)
Cinema or theatre manager (149912)
Lighting technician
Light technician (399513)
Multi/New/Interactive media designer
Multimedia designer (232413)
Multimedia specialist and web developer
Multimedia specialist (261211)
Web developer (261212)
Post-production media technician
Production assistant (film, television, radio
or stage) (599912)
The table below outlines qualifications which are required for occupations experiencing a
critical skills shortage.
Qualifications required for occupations experiencing critical skill shortages
Occupation (Industry title)
Qualification
Swimming coach/ Aqua Instructor
Lifeguard
Certificate III in Aquatics
Certificate III in Aquatics
Camera Operator (film, television, or video)
Certificate IV in Broadcast Technology
Cinema Theatre/Facilities Manager
Diploma of Venues and Events
Advanced Diploma of Venues and Events
Lighting Technician
Certificate III in Live Production, Theatre and Events
Certificate IV in Live Production, Theatre and Events
Certificate IV in Screen Media
Certificate IV in Electrotechnology
Diploma of Screen and Media
Multi/New/Interactive Media Designer
Certificate IV in Interactive Digital Media
Certificate IV in Information Technology (Multimedia)
Diploma of Interactive Digital Media
Multimedia Specialist and Web Developer
Certificate IV in Information Technology (Websites)
Diploma of Information Technology (Websites)
Post Production Media Technician
Certificate IV in Screen Media
Certificate IV in Electrotechnology
Certificate IV in Interactive Digital Media
Diploma of Screen Media
Deloitte Access Economics
51
2012 ITAB Market Effectiveness Report
9 Electro-technology and
Communications
Coverage:
Communications, Electrical and Electronics, Information
Technology, Printing, Gas transmission, Rail Traction, Renewable Energy.
Specific industry and business cycle drivers: Pace of technological advance
(may boost demand for the sector, but may also be labour saving), extent of
offshoring, the $A.
Recent performance rating: Below average
Expected relative sectoral performance rating: Average
Summary of ITAB advice and consultation
Market effectiveness
There have been several examples of market success in the electro-technology, electricity
supply, IT and communications, and printing sectors over the past year.
One story which stands out has been in motor rewinding (or armature winding), which has
suffered from thin markets for a number of years (enrolments have previously been less
than eight per year). Additionally, industry has been reluctant to have staff away from the
workplace for a significant length of time. However, an RTO was found which was prepared
to offer and develop training which was able to be provided at the workplace. Crucial to
the process was that a memorandum of understanding between industry and the Bendigo
Regional Institute of TAFE was developed, which states that if less than 14 students were
enrolled in a year, then an industry fund will pay the costs associated with running the
program for a reduced number of students. This industry fund provides certainty for the
RTO and industry alike, in ensuring sufficient funds are available to run the Certificate III in
Electrical Motor Repair.
The success in armature winding training was a joint effort between EPIC Industry Training
Board, Manufacturing and Engineering Skills Advisory Board (MESAB), industry and training
providers. MESAB was involved initially in securing the funding, while the Electrotechnology, Printing, Information and Communications Industry Training Board (EPIC) is
now ensuring that the training continues.
There has been a higher than expected uptake of apprentices and non-apprentices to
become ‘dual trade’ electrical instrumentation technicians. The target number was 50
over two years, and enrolments are currently at 94. This qualification (Certificate IV in
Electrical Instrumentation) takes four years to complete, and it is hoped that graduates will
ease the shortage currently being experienced by industry over coming years. This project
has also increased the interest in traditional instrumentation qualifications (a Certificate III
qualification), with enrolments growing from seven in 2010 to 18 in 2011.
Deloitte Access Economics
52
2012 ITAB Market Effectiveness Report
A program was run in 2011 to encourage employers to provide professional development
for unqualified IT support employees using the Certificate III in IT (Client Support). The
targeted enrolment number was 48, with 53 achieved. This increase in the number of
enrolments has gone some way to alleviating the shortage for employees with IT support
skills, and is the reason that IT Client Support employees do not appear in the 2012 critical
shortages list. This program will continue next year, and will be assessed every two years.
Another program which was run in an attempt to boost enrolments was the Certificate IV
in Electrical (aimed at up-skilling electricians) which resulted in 109 enrolments. This
program resulted in strong working bonds between industrial organisations being
established, which led to donations of electrical motor drive equipment from several
private sector companies. Similarly EPIC liaised with industry to ease the looming shortage
of instrumentation technicians. Some 94 enrolments were achieved in 2011 (consisting
largely of electricians up-skilling).
The Certificate II in Asset inspection was developed during 2011, responding to the
Victorian Bushfire Royal Commissions findings in relation to the need to strengthen both
theoretical and practical training for asset inspectors in Victoria. This program will
commence in 2012, and it is expected that several hundred existing workers will acquire
this new qualification (either via RPL or the gap training process). Approximately 15-20 new
entrants are expected to also undertake the qualifications every year.
Qualifications surrounding clean energy and energy efficiency are gaining momentum.
Certificates II, III and IV in Renewable Energy have seen increases in enrolments in 2011.
Solar energy qualifications in particular are popular, with 99 enrolments in the Certificate IV
in photovoltaic cells.
Ongoing market failures in training within EPIC’s industry sectors include the problem of
thin markets and training which fails to meet industry needs. The result is a poor take up
of training packages, with necessary training conducted largely in house. For example
during 2011 an attempt was made to enrol 50 electricians into the Certificate III in ESI –
Distribution qualification, with the hope of alleviating critical shortages in this area. The
Bushfire Royal Commission had noted that there was insufficient training and recruitment
of line workers, and that this should be addressed. However, the program only attracted
eight candidates in 2011. Employers appear to favour apprenticeships or hiring overseas
trained workers instead, citing the length of time that qualified electricians would take to
be able to work productively in this line of work after completing the qualification.
There are numerous courses which suffer from a lack of enrolments across the State,
several of which relate to public safety, including:

Certificate II in Fire Alarms Servicing

Certificate III in Fire Protection Control

Certificate IV in Electrical – Fire Protection Control Systems

Certificate IV in Hazardous areas – Industrial control

Certificate IV in Hazardous areas – Electrical
It had been expected that industry would provide a level of enrolments to make offering
these courses cost effective for training providers. However this has not been the case.
EPIC reports that these qualifications were developed by the ElectroComms and Energy
Utilities Industry Skills Council in collaboration with industry, and that the key reason why
enrolments have not been significant is the lack of a cohesive approach from training
Deloitte Access Economics
53
2012 ITAB Market Effectiveness Report
providers to attracting individuals. EPIC also notes that these are niche skills that are
typically obtained by A-class electricians and electronics trades people who learn on the
job.
In all instances there is no regulation or requirement for practitioners to undertake the
training. However some, if not all, of these qualifications are likely to be required under
legislation in the future, at which time there will be huge demand as existing workers
undertake the qualification. However, until this occurs, it is unlikely that enrolment
numbers will increase.
There is a lack of interest by industry in many other qualifications, including the gas sector
(where the sector is largely not supporting nationally recognised training), the generation
sector (which has largely ignored the Generation training package with the exception of the
Certificate III in ESI Generation), and the electrical supply industry (particularly the
Certificate IV in ESI – Power Systems and Certificate IV in ESI – Network Infrastructure).
Training providers are finding it difficult to provide the training for many of these courses.
However, the electrical supply industry (ESI) qualifications face limitations from both the
supply and demand perspective. Training providers are unable to find teachers suitably
qualified to teach the material, and training providers are only able to offer limited
simulation capabilities. This is further pushing industry away from formal training, and
instead undertaking training in-house.
The same is true for many printing and graphic arts qualifications, many of which are facing
the additional burden of a declining industry (this includes qualifications at the Certificate III
and IV level specialising in Cartons & Corrugating, Sacks and Bags, Ink Manufacture,
Printing, Print Finishing and Mail House). Despite a surge in the number of parcels sent
through the post due to internet shopping, the postal industry appears to prefer to train in
house, rather than utilise the training packages.
There has also been a lack of interest in several other qualifications, including at the
Diploma and Advanced Diploma level, suggesting that trade-based graduates are not eager
to continue studying beyond the Certificate IV level. For example, while the lower level
qualifications for renewable energy are being utilised, the Diploma of Renewable Energy
Engineering is less popular, with only two enrolments in the qualification in 2012. This
course contains more managerial content than the lower qualifications, which perhaps is
the reason for the lack of interest. Another factor may be that it takes two years to
complete the diploma, and industry generally regards two years of on the job training as
more desirable.
Interest in the Training and Education qualification by electro-technology and
telecommunications practitioners has also been low. A program was put in place in 2011 to
provide eight training placements at Kangan TAFE. However five declined the offer of a
position before training commenced. Remuneration is always higher for people with
technical skills when they remain in the field rather than switch to a classroom, and as a
result it is difficult to attract people to the teaching profession (which is ageing quickly).
EPIC notes that it is now the case that some lecturers are receiving training of only 2-3
weeks before being put into the classroom.
Finally, public training providers are having difficulty keeping up with the advancements
in technology and new infrastructure requirements, as well as integrating these changes
into training courses – particularly in the power generation sector. This means that it is left
to private providers to undertake the training (or it is not offered at all).
Deloitte Access Economics
54
2012 ITAB Market Effectiveness Report
Change drivers and industry developments
Many change drivers remain similar to previous market effectiveness reports. EPIC has
identified the following key change drivers for 2012:


The ageing workforce (demand side)
The NBN rollout (demand side)


Renewable energy technology and green skills (demand side)
The Regional Rail Link project (demand side)

Changing regulation (demand side)
The ageing workforce continues to contribute to labour shortages as well as skill shortages.
The rail sector and electrical line worker occupations in particular have an older than
average workforce, and population ageing therefore tends to affect these sectors more
than most. The rail industry needs to recruit between 200-300 engineers every year for the
next five years to meet demand, which is not currently being met, and currently the
industry needs around 200 rail signal workers to meet the shortage. Both sectors have a
long lead time from training to on-the-job competency.
The National Broadband Network (NBN) rollout will have a substantial impact for workers
in the industry in 2012 and for many years to come. This project will connect 90% of
Australian homes and businesses to a fibre-to-the-premises broadband network. Estimates
have the unmet demand nationally to be in excess of 10,000 workers, and that several
hundred will be required in Victoria. However, it is unclear exactly what skills will be
required for workers (for example, it is not clear whether overhead or underground skills
will be required).
Currently industry is targeting basic cabling training, although it is unclear the extent to
which the market will demand this. Until some certainty is provided from industry, it is
unlikely that this project will significantly affect enrolment numbers (although an increase
in enrolments is expected in 2012). However, once the project is fully up and running,
demand for telecommunications qualifications could increase sharply. Training demand
will again change once the NBN is up and running – the demand for cabling skills will be
replaced by services installation, maintenance, testing and commissioning skills.
The renewable energy sector continues to drive change in the electro-technology sector –
which is seeing significant growth in credentialing against qualifications. Small businesses
in particular are enrolling workers in qualifications that enhance the installation and
maintenance of renewable energy systems such as solar cells, hot water units, lighting
efficiency and energy auditing. Enrolment numbers will increase significantly if regulations
surrounding this industry change. For example in Victoria only 1% residential solar
installations are inspected, and issues surround inappropriate installations are emerging.
As governments legislate for a greener community, enrolments for ‘green’ qualifications
will increase, which may lead to non-government funded RTOs entering the training market
(currently the primary source of training in this area is government funded RTOs).
The electro-technology sector will continue to improve and update the ‘green’ components
of training packages as renewable technologies continue to develop.
The Regional Rail Link project involves the construction of a major new rail line linking
West Werribee with Southern Cross Station in the Melbourne CBD. Construction will take
place between 2012 and 2016, and will increase demand for workers with skills in rail
communications and signalling. As a result, the rail sector is currently actively seeking to
Deloitte Access Economics
55
2012 ITAB Market Effectiveness Report
develop more training facilities to accommodate and enhance training for signalling and
train control.
Many of the thin market problems are more acute in the regional areas. Attempting to
provide training to those in regional areas will result in ongoing facilitation between
industry and RTOs to try to implement a solution that will see the appropriate number of
people trained.
Changing regulation will create new demand. New regulations for numerous public safety
qualifications, as well as in the renewable energy sector are likely over coming years (for
example in solar cell installation, fire alarms servicing, fire protection control and hazardous
industrial control). Any new regulations requiring qualifications would see an increase in
the demand for the corresponding qualifications.
Industry outlook
This industry encompasses the provision of a number of household services, including
communications and utilities such as electricity and gas transmission. Other sectors include
IT, printing, rail traction (which covers Melbourne’s trams and electrified rail lines) and
renewable energy. Over the long term, drivers of growth in this area include population
growth, technological developments and, for renewable energy, climate change policy.
The passage of carbon tax legislation through the Federal Parliament provides a degree of
certainty for business and industry around climate change policy, and should provide
further incentive for new investment in renewable energy. At present, only around 5% of
Victoria’s energy consumption is derived from renewable sources. That share is expected
to grow notably over the next decade to ensure Victoria meets the 20% target stipulated by
the Australian Government’s Renewable Energy Target. At present, wind power provides
almost half of Victoria’s renewable energy output, but represents less than one-third of
installed capacity.
Population growth is an important driver of demand for the industry. A larger population
implies more households and therefore more connections for electricity, gas, telephone
and internet services. A higher population also means greater demand for energy and
transport services, leading to greater levels of investment and a higher employment base
overall. Through the year to mid 2011 the Victorian population grew by 1.5%, down on the
growth of more than 2.0% seen in 2009. Deloitte Access Economics expects annual
population growth of around 1.5% in Victoria in the next few years.
Chart 9.1: Employment outlook – Victorian electro-technology and communications industry
'000 persons
90
Forecast
80
Change on year earlier
20%
Forecast
15%
70
60
10%
50
5%
40
0%
30
-5%
20
10
-10%
0
-15%
1998
2002
2006
2010
2014
Victoria
Electro-technology and
communication
1998
2002
2006
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
Deloitte Access Economics
56
2012 ITAB Market Effectiveness Report
A third driver of employment demand in the electro-technology and communications
industry is technological change and innovation. This is relevant for the roll out of various
forms of renewable energy, but also relates to the IT, communications and electronic
printing sectors, where new products help to sustain consumer demand. Those trends may
result in the industry accounting for a larger share of the Victorian economy, but not
necessarily a larger share of employment.
The chart below shows that skilled vacancies for electrical and electronics tradespersons (as
measured by DEEWR’s Skilled Vacancy Index) fell back slightly in 2011 in line with both the
Victorian average and the historical trend over the past decade.
Chart 9.2: Skilled Vacancy Index – Victorian electro-technology and communications industry
Index: 2000 = 100
450
More
vacancies 400
350
300
250
200
150
100
50
Fewer
vacancies
0
1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011
Victoria (Total)
Electrical and electronics trades
Source: Commonwealth Department of Education, Employment and Workplace Relations
After remaining steady over much of the past decade, data from the Australian Bureau of
Statistics suggests that employment in the Victorian electro-technology and
communications industry fell back in 2011. Deloitte Access Economics expects employment
to recover modestly in 2012 before remaining relatively steady over coming years.
Occupations in demand and critical skill shortages
Response to 2011 critical skill shortages
There were eight critical skill shortages reported by EPIC in the 2011 report, and there has
been mixed success in alleviating these shortages over 2011.
EPIC developed a project to convert 50 A-class electricians to line workers in an abridged
apprenticeship of two years to help address the critical shortage of electrical line workers.
As mentioned above in the market failures section, only eight places were taken up by
industry. There is, however, an ongoing commitment to continue the program in 2012.
During 2011 there has been some facilitation of discussion between training providers,
Metro Rail and the Electrical Trades Union in order to try to alleviate the critical shortage of
electrical engineers, network controllers and track workers. An agreement has been
Deloitte Access Economics
57
2012 ITAB Market Effectiveness Report
reached on a training delivery strategy, with memorandums of understanding drawn up
with the RTOs, and Union endorsement on training numbers.
Industry has responded to the critical shortage of telecommunications technical officers by
increasing the number of workers enrolled in the Certificate III in Telecommunications and
Telecommunications Cabling, although the Certificate IV and Diploma level qualifications
are not seeing an increase in enrolments. Enrolments are expected to increase again in
2012 as demand due to the NBN increases.
Binder and finishers were on the critical shortage list in 2011. The occupation has,
however, dropped off the list in 2012 due to a lack of demand for this qualification. Many
businesses are now going to digital print, which requires a different set of skills.
Armature winding has been discussed in the market training success section above. The
formation of an industry working group by EPIC resulted in employer agreement to increase
apprentice numbers, and the establishment of an industry fund to make up any shortfall in
the number of enrolments. This has resulted in the qualification being run in 2011.
EPIC initiated a program with Kangan TAFE for 8 training placements in the Certificate IV in
Training and Assessment in an attempt to alleviate the shortage in teachers. Only three
applicants commenced classes in 2011, despite marketing the training to industry, which
highlights the difficulty in attracting high quality trades people into the teaching profession.
Air-conditioning and refrigeration mechanics were on the list in 2011 though have been
removed from the list for 2012. Most of the existing mechanics have undertaken the
training (generally one year), although many of the qualifications were obtained through
RPL.
The critical shortage of cablers and telecommunications lines workers remains. Although
there has been good take up of the Certificate II qualification, there remains a shortage of
qualified workers in the industry.
Occupations in demand and critical skill shortages in 2012
The tables below summarise the occupations in demand and experiencing critical skill
shortages in 2012. These occupation lists have been advised by EPIC, and have been
determined following formal engagement with industry.
Some of the occupations listed in the 2011 report appear again on the 2012 occupations in
demand list, such as electrical line workers, electrical engineers for rail, armature winders
and teachers in electro-technology.
New to the lists in 2012 are cable jointers, substation electricians, digital printers and rail
signallers.
Sub-station electricians generally take four years to train. Many workers already in the
industry are unqualified and unlicensed, and the workforce in general is nearing retirement.
The looming shortage in substation electricians saw EPIC intervene to enrol 28 people in
the rail qualification, and the intention is to extend this initiative for all other substation
areas, including the ESI sector, during 2012. However, these enrolments are not expected
to be of sufficient quantity to alleviate the critical skill shortage.
Industry has made a strong argument to EPIC that there will be a shortage of cable jointers
in the near future, due to the Victorian Government election commitments to
‘underground’ a larger rural area than was recommended by the Bushfire Royal
Commission.
Deloitte Access Economics
58
2012 ITAB Market Effectiveness Report
It is estimated that Victoria could experience a shortage of up to 200 electrical inspectors
given the outcomes of the Bushfire Royal Inquiry and increasing Solar Panel installations on
houses. Many people in this line of work are contractors, who have converted from
engineering or electrician trades. Training to become an electrical inspector is not long
(which is why this qualification is not listed on the critical shortage list), however building
interest in this occupation is expected to take some time.
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Cable Jointing
Technical cable jointer (342212)
Telecommunications cable jointer (342412)
Rail Signalling
Railway signal operator (712917)
Electrical Inspectors
Building inspector (312113)
Armature Winding
Electrician (General) (341111)
ESI line worker
Electrical linesworker (342211)
Digital Printing
Small offset printer (392312)
Telecommunications Cabler
Cabler (Data and telecommunications) (342411)
Instrumentation Technician
Electrical engineering technician (312312)
Substation Electrician
Electrician (Special class) (341112)
Occupations experiencing a critical skills
shortage Industry title
ANZSCO classification
Cable Jointing
Technical cable jointer (342212)
Telecommunications cable jointer (342412)
Rail Signalling
Railway signal operator (712917)
Motor Rewinding
Electrician (General) (341111)
Telecommunications Cabler
Cabler (Data and telecommunications) (342411)
Digital Printing
Small offset printer (392312)
ESI line worker
Electrical lines worker (342211)
Substation Electrician
Electrician (Special class) (341112)
The table below outlines qualifications which are required for occupations experiencing a
critical skills shortage.
Qualifications required for occupations experiencing critical skill shortages
Occupation (Industry title) Qualification
Cable Jointing
Rail Signalling
Certificate III in ESO Cable Jointing
Certificate IV in Rail and Tram Signal Systems
Motor Rewinding
Certificate III in Electrical Motor Repair
Telecommunications Cabler
Certificate III in Telecommunications
Digital Printing
ESI Lineworker
Certificate III in Telecommunications Cabling
Certificate III in Printing and Graphic Arts (Digital Printing)
Certificate III in ESI – Distribution
Substation Electrician
Certificate IV in ESI – Substation
Deloitte Access Economics
59
2012 ITAB Market Effectiveness Report
10
Food Processing
Coverage: Baking, Dairy, General, Meat, Milling and Confection, Wine and
Other Beverages, Pharmaceuticals.
Specific industry and business cycle drivers: The $A, competition from New
Zealand producers (affects the degree of imports), FSANZ regulatory burden.
Trend towards more ready prepared meals/less preparation from fresh
ingredients. Developments in markets which buy live Australian animal
exports. Developments in Australian regulation of the live animal trade.
Recent relative sectoral performance rating: Average
Expected relative sectoral performance rating: Average
Summary of ITAB advice and consultation
Market effectiveness
A number of examples of market success and failure were provided by the Victorian Food
Industry Training Board (VFITB), with several successes relating to skills shortages identified
for 2011. Many of these successes were in relation to industry take-up of new
qualifications or units under the new training package, while examples of failure tended to
relate to training quality.
The rollout of the new FDF10 training package, available since May 2011, has been seen as
a success. The industry has embraced its flexibility and the new units, for example the
compulsory units in sustainability and electives in competitive manufacturing. The
industry and VET sector are working to deliver these units in the most useful way for the
industry.
There has been an expanded delivery of training focused on productivity skills (also
referred to as competitive or lean manufacturing). As mentioned in the 2011 report, these
skills are important to the industry as a strong Australian dollar and competition lead to a
greater need to increase productivity and decrease costs. It has traditionally been difficult
for the food industry to engage in this sort of training due to the production-line nature of
their business, meaning access to off-site external training is difficult. However, a number
of private providers and some TAFEs have successfully expanded Competitive
Manufacturing and Frontline Management training into the food processing industry by
delivering training on-site.
A pilot Vocational Graduate Certificate in Food Industry Management was successfully
delivered in the dairy sector, with a take-up rate of 11 people. This qualification aims to
address an identified skills gap among experienced middle and senior management in the
industry, improving their food processing knowledge. Delivery of the qualification was
brought about as a result of discussion and collaboration between the RTO and industry.
The next challenge will be to roll this out to other areas of industry, such as confectionery.
This will require further collaboration between industry and RTOs.
Meat inspectors were included on the occupations in demand list in 2011 due to changes in
regulations for the inspection of meat for export. This was expected to lead to strong
demand for Certificates III and IV in Meat Safety. The VET sector successfully met this
Deloitte Access Economics
60
2012 ITAB Market Effectiveness Report
increased demand, with enrolments in the Certificate IV in Meat Safety increasing from 18
in 2008, to 52 in 2010 and 97 in 2011.
Discussions between the baking sector and the training sector saw the development of a
new Certificate IV in Advanced Baking in 2009-10. This qualification is aimed at improving
retention rates in the baking sector, by developing skills of experienced bakers in the areas
of artisan baking and business management, clearing a more defined pathway for career
progression and business success. This is a work in progress, with expected delivery of the
qualification by RTOs in 2013.
A number of examples of training market failure were also identified. One of these is the
elimination of trainee incentives for Certificate II in metropolitan areas from the Federal
Government from May 2011. This has led to a reduction in the delivery of relevant
Certificate II qualifications in metropolitan Melbourne. For example, VFITB reports that
enrolments in the Certificate II in Meat Processing (Abattoirs) halved between 2010 and
2011. VFITB expects a greater impact in 2012, with reduced delivery of Certificate II in Food
Processing and Certificate II in Meat Processing. This will be problematic for the industry as
new workers enter the industry and require training. While it is not compulsory to have a
Certificate II, the qualifications are an effective way to deliver food safety and occupational
health and safety work practices, and thus meet WorkSafe approvals. As a result, food
businesses may begin enrolling a smaller number of staff in Certificate III qualifications.
The developments for the new Certificate IV in Advanced Baking are a potential positive for
the sector. However the current Certificate III programs that are not apprentice based for
bakers and pastry cooks are not producing job-ready graduates. Employers are not
prepared to take on these graduates, contributing to unmet demand for quality bakers and
pastry cooks.
VFITB reported that the industry believes the training system is too complex, leading to a
lack of engagement with industry. Examples of how the system is too complex include:
complexity of fee structure, Federal Government incentives, RTO costs, training packages
versus training plans and ways in which industry might work with RTOs. Due to the number
of RTOs in competition with each other now, companies frequently receive cold calls from
RTOs, creating additional confusion. There is a lack of transparency and information. This
can lead to a situation where companies do not want to engage with any training provider.
There is a perception that general food training lacks quality. An example was provided of
a regional food company that engaged an RTO to deliver training of Certificate II and
Certificate III-level qualifications onsite to 300 staff members. The aim was to improve
operator engagement and accountability for the production process. However, the
company reported no discernible improvements as a result of their investment in training.
The VFITB suggests that many companies perceive that RTOs, particularly private RTOs, are
not providing sufficient quality of training.
Change drivers and industry developments
A number of change drivers for 2012 were reported by VFITB. These were:
 Cost and time constraints for consumers (demand side)
 Increased consumer and retailer demand for quality and safety (demand side)
 Concern about animal welfare (demand side)
 Lower international demand and competition from imports (demand and supply side)
 Cost rises associated with sustainability (supply side)
 Adverse weather (supply side)
Deloitte Access Economics
61
2012 ITAB Market Effectiveness Report
A high Australian dollar has led to falling demand from overseas markets for many
Australian food products. It has also led to increasing competition from imported food
items, which are now relatively cheaper. These drivers have resulted in a number of local
site closures. The implications for skills transpire in three main ways: staff who have lost
their jobs re-skill to look for work elsewhere, some companies defer training or provide
training in-house as a cost saving measure and others up-skill their staff in areas that will
make them more competitive.
To the extent that companies respond by up-skilling their staff, there will be a demand for
training that addresses productivity improvements. These generally relate to the
improvement of process systems and a desire to improve skills of management and
leadership. As a result, the industry is increasingly adopting competitive manufacturing
processes, as addressed by the new flexibility in the FDF10 training package. It is also
expected there will be increasing awareness and take-up of VET programs to improve
management skills, in areas such as Frontline Management.
The industry is faced with continual demand for improvement in both food quality and
safety, coming from both retailers and consumers. In response to this demand, the
industry is tightening its standards, with the need for delivery of more short courses and
full qualifications to meet compliance and regulatory requirements. As such, training will
continue to be delivered at existing sites.
Consumers are also facing budget and time constraints for their food shopping and this has
had a particularly strong impact on butchers, who are facing competition from
supermarkets. VFITB reports that reduced profitability has led to butchers increasingly
having apprentices complete on the job training rather than attending block release to a
TAFE for formal theory and demonstration training components. There is growing
importance for skills that value-add to meat products thereby saving time that the
consumer needs to spend in the kitchen. As a result, retail butchery is focusing on
improving customer relation skills.
Another driver that has had an impact on the butchery sector is community and
government concern about animal welfare, following on from attention in the media last
year. This has also led to demand for skills in customer relations, whereby meat retailers
need to be able to talk to their customers about the provenance of their products. As a
result, new training programs have been adopted and the National Meat Industry Training
Advisory Council has developed new training units. This pre-empts the potential
introduction of more rigorous compliance standards.
On the supply side, food producers are facing costs due to policies targeting sustainability
and climate change. In particular, this is likely to transpire as higher input costs for utilities.
An increased awareness of charges for power and water is leading the industry to place
more emphasis on the need to reduce, re-use and recycle. This is creating a heightened
awareness of the benefits from increased efficiency and the value that new sustainability
units can offer. As mentioned in the assessment of market effectiveness, the industry and
VET sector are working to deliver these units in the most useful way for the industry.
Recent adverse weather conditions have also had an impact on the industry. With
agricultural production down, there is less agricultural stock available for processing. For
example in the meat sector, farmers are focusing on rebuilding their herds which means a
reduction in the amount of local meat stock for slaughter. Overall fewer staff require
training and there is a reduced demand for meat-related qualifications.
Deloitte Access Economics
62
2012 ITAB Market Effectiveness Report
Industry outlook
The food processing industry has been experiencing a general trend towards increased
consolidation and greater foreign competition for some time. In the short term, the
outlook for the industry also depends on favourable weather conditions for local
agricultural production and the level of the $A.
Victorian farmers have benefited from favourable seasonal conditions and good rainfall in
2010 and 2011. The rainfall that boosted Victorian crop production was also a blessing for
irrigation-dependent farms in the Murray–Darling Basin. Water storages in Murray–Darling
Basin dams are now just below 80% of capacity, compared with 52% as recently as a year
ago. The improved conditions for Victorian agriculture are also favourable for the local
food processing industry. The increased water storages in the Murray-Darling Basin will be
a positive in the medium term, especially for production and processing of meat and dairy.
In some sectors of the food processing industry, input prices determined on international
markets are important drivers of production costs. Most agricultural commodity prices are
relatively high in historical terms. Sugar prices were pushed very high in January after
Cyclone Yasi and, despite easing back more recently, remain relatively high. That is having
an effect on the confectionery industry based in Victoria.
The impact of the high $A and the trend toward consolidation in the food processing
industry are illustrated by recent high profile factory closures during the course of 2011 to
date. These include the closure by SPC Ardmona of a manufacturing facility in northern
Victoria with the loss of around 150 jobs, largely due to the impact of the $A making
competing imported products cheaper and its export business uncompetitive.
Other recent announcements include HJ Heinz reducing the size of its Australian workforce
by 20% or 346 jobs, and closing a tomato sauce factory at Girgarre in northern Victoria with
the loss of 146 jobs, while Lion (previously National Foods) announced that it would close
its Simpson and Campbellfield cheese making sites over three years, with the loss of 133
jobs.
Employment outlook – Victorian food processing industry
'000 persons
90
Forecast
Change on year earlier
15%
Forecast
80
10%
70
60
5%
50
40
0%
30
20
-5%
10
Victoria
0
Food
-10%
1998
2002
2006
2010
2014
1998
2002
2006
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
Deloitte Access Economics
63
2012 ITAB Market Effectiveness Report
Important factors behind the closures made by HJ Heinz and Lion (National Foods) appear
to be a drive to consolidate operations to drive productivity improvements. In light of the
structural challenges facing Victoria’s manufacturing industry, the Victorian Government
asked the Victorian Competition and Efficiency Commission to complete an inquiry into
Victoria’s manufacturing industry. The inquiry produced some 44 recommendations
covering a broad range of issues related to the industry, including government funding and
investment, innovation, regulation and taxes, and training and skills. The Victorian
Government has announced that it supports (including in part or in principle) 42 of the 44
recommendations.
Skilled Vacancy Index – Victorian food processing industry
Index: 2000 = 100
300
More
vacancies
250
200
150
100
50
Fewer
vacancies
0
1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011
Victoria (Total)
Butcher
Baker
Pastrycook
Source: Commonwealth Department of Education, Employment and Workplace Relations
The Federal Government’s carbon tax will be introduced in 2012 and will pose further
challenges for the domestic food processing industry. Food processing is not emission
intensive, however the industry may be expected to see a rise in costs such as electricity,
which is likely to further reduce the competitiveness of domestic producers. As such, the
Federal Government will provide special assistance of up to $150 million over six years to
the food processing industry through the Clean Technology — Food and Foundries
Investment Program to install more energy efficient equipment.
The chart above shows skilled vacancies for workers in the food processing industry (as
measured by DEEWR’s Skilled Vacancy Index). The chart shows the skilled vacancies
increased for butchers and bakers in Victoria in 2011, while skilled vacancies for pastry
cooks continued a longer term trend of decline. That does not necessary imply that pastry
cooks are not in demand, particularly in regional areas or where some degree of
consolidation of the industry may mean fewer workers are required overall, but that job
vacancies remain unfilled.
Overall, and as the charts above show, Deloitte Access Economics expects employment in
the industry to continue relatively steady growth of around 1.7% in 2012.
Deloitte Access Economics
64
2012 ITAB Market Effectiveness Report
Occupations in demand and critical skill shortages
Response to 2011 critical skill shortages
No critical skills shortages were reported in 2011.
Occupations in demand and critical skill shortages in 2012
No critical skills shortages were reported for 2012 and the only expected occupations in
demand are baker and pastry cook. This a reduction from the four occupations listed as in
demand in 2011. No critical skill shortages have been reported as VFITB deemed that baker
and pastry cook does not meet the specified critical shortage criteria.
It should be noted, however, that both baker and pastry cook appear on the latest Victorian
skill shortage list (2010-11) published by DEEWR.
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Baker and pastry cook
Baker (351111)
Pastry cook (351112
Deloitte Access Economics
65
2012 ITAB Market Effectiveness Report
11
Forestry
Coverage: Forest growing and management, harvesting and haulage,
sawmilling and processing, timber product manufacturing, wood panel/board
production, pulp and paper manufacturing, timber merchandising.
Specific industry and business cycle drivers: the high Australian dollar,
implications and application of Free Trade Agreements, climatic conditions and
natural disasters, sustainability policy, tax provisions, housing construction
cycle.
Recent relative sectoral performance rating: Low
Expected relative sectoral performance rating: Low
Summary of ITAB advice and consultation
Market effectiveness
The Victorian Forest and Forest Products Industry Training Advisory Board (VFITAB) report
market successes and failures for 2011 in relation to both historical and emerging skill
needs. The successes demonstrate an ability to identify and close a gap in the training
market by mobilising a suitable training provider. Conversely the failures demonstrate the
persistence of low enrolments in particular skill areas, relating to both a lack of certainty
and a lack of new entrants.
The first example of training market success has been a reduction in identified training
gaps among the harvest and haulage sector. VFITAB promoted and supported (with small
financial incentives) training at the Certificate III level, increasing enrolments by 60, to a
level more in line with what the industry requires annually (although these were mainly
existing workers).
In 2011 VFITAB also supported Hancock’s Victoria plantation to up skill their workers
through the completion of a Certificate III in Horticulture. The qualification was delivered
by TAFE on site at Hancock’s nursery, incorporating relevant units from the ForestWorks
Forest and Forest Products Training Package.
In terms of market failure, the primary example is the critical shortage of wood machinists
being compounded by continued low enrolments in the Certificate III. A similar situation
applies to the Certificate III in Saw Doctoring. The lack of demand to undertake training in
these highly specialised fields has discouraged the traditional training provider from
keeping it on scope. VFITAB is now working to create a critical mass of training across
jurisdictions, to ensure the course remains available.
VFITAB has also raised the removal of training capacity from South West TAFE for the
forestry industry as an example of training market failure. VFITAB notes emerging training
demand exists in the region, with no capacity for the supply of relevant training places in
western Victoria.
Deloitte Access Economics
66
2012 ITAB Market Effectiveness Report
Change drivers and industry developments
Advice from VFITAB is that a number of largely supply side change drivers are likely to have
an impact in 2012, in a similar fashion to that experienced in 2011. This includes:

Regulatory change (demand and supply side)

High $A and competition from overseas timber, pulp and paper (supply side)

Continued restructuring of Victorian sawmills (supply side)

Blue gum harvest cycle in the Victorian Green Triangle Region (supply side)
Each of these developments directly impacts the output of Victoria’s forestry sector, with
corresponding implications for the volume of skills in demand in 2012.
In terms of regulatory change, the Illegal Logging Prohibition Bill 2011 will make the
importation of illegally logged timber into Australia more difficult from 2012 onwards –
provided the bill is passed early in the year. Due diligence requirements include certification
and chain of custody, to be particularly stringently applied to timber sourced from Brazil,
China, Chile and Malaysia. Not only will this increase the demand for Australian timber
domestically, it will also create demand for higher order skills in the technical identification
process, linking to the new Advanced Diploma in Forest Industry Sustainability.
The industry continues to struggle with a historically high $A, and the uncertainty this
creates for domestic and international sales of Australian timber. Exports from developing
countries are typically more attractive to price sensitive consumers in global markets, and
are thereby driving a downturn in Australian sawmilling, processing and timber
merchandising. This has resulted in both a reduction in new entrants to the sector as well
as an increase in skilled labour transitioning out of the sector, and corresponds with the
restructuring of Victorian sawmills. However, restructuring is also seeing demand for
some new skills emerge, such as in technology operations in wood panel production at the
recently upgraded Myrtleford plant.
Pulp and paper is experiencing a similar trend, with the added complexity of holding capital
with long remaining payback periods. Given the immobility of both capital and labour
involved in this production, and the fact that it is isolated in eastern Victoria for the most
part, the industry is persisting with the struggle to remain viable as options for restructuring
are limited. The implication is that pulp and paper production has a fixed life in Victoria,
and similar to the restructuring of sawmills, government support for regional employment
through structural adjustment funding will likely be required at a future point.
Harvesting of the blue gum plantation in the Victorian Green Triangle Region continues to
ramp up, with a corresponding increase in demand for mechanical harvesting operators
and foresters in the region. To date a range of issues have delayed production, with only
25% of the target harvest rate being achieved. As these constraints ease, labour constraints
are likely to become increasingly binding – short of a dramatic uptake of Certificate III in
Harvest and Haulage and Certificate IV in Forest Operations. Inhibiting this would be the
lack of a training provider in Victoria (currently provided by a small private RTO in South
Australia instead). VFITAB is currently working with an RTO in Victoria to create a
partnership for more effective delivery.
Other advice from VFITAB includes the development of a new Advanced Diploma in Forest
Industry Sustainability In collaboration with the Industry Skills Council. VFITAB is currently
working to attract a training provider. Latent demand for this training exists at the middle
manager level across a number of large forestry companies operating in Victoria. It is
expected that this qualification will be taking enrolments in 2012 (indeed up to 20).
Deloitte Access Economics
67
2012 ITAB Market Effectiveness Report
VFITAB has also identified an emerging skill need in the area of ‘finger jointing’ – a new
and more sustainable practise of gluing together sawmill off-cuts to create stronger timber
products (and therefore new structural uses for timber). In collaboration with industry, a
number of units of competency are being developed, with the concept of a standalone
qualification being discussed and investigated (demand is estimated to be in the order of 40
enrolments).
Industry outlook
The Victorian forestry industry is heavily reliant on two key markets: the domestic
construction industry, which is the largest user of domestically harvested sawn timber and
related products; and woodchip exports, which are Australia’s biggest single forestry export
by value. Victoria is unique, in the sense that most of its woodchip exports are coniferous
(softwood), whereas other States are dependent on broadleaved (hardwood) woodchips.
Victoria’s sawn wood industry is relatively insulated from global trade, with only around 7%
of Australia’s overall production being exported in 2008-09. This component of Victorian
forestry is therefore predominately driven by movements in the construction industry,
particularly residential construction.
The relatively strong residential construction activity in Victoria has been an important
positive for the sawn wood industry in recent years, with growth in the State outperforming
the national average. Indeed, while Victoria accounts for a quarter of the national
population, and slightly less in terms of economic output, the State currently provides 40%
of new housing starts in Australia.
The outlook for residential construction is more modest however, with slowing population
growth expected to see construction activity ease in the medium term.
There are also challenges facing the woodchip industry. Most of Australia’s (and Victoria’s)
woodchip exports are shipped to Japanese paper mills, and Australia is Japan’s largest
provider of woodchips, accounting for 31% of Japanese woodchip imports in 2010-11.
Victoria accounts for roughly a quarter of Australian woodchip exports.
Chart 11.1: Employment outlook – Victorian forestry industry
'000 persons
30
Forecast
Change on year earlier
20%
25
15%
20
10%
Forecast
5%
15
0%
10
-5%
5
-10%
0
Victoria
-15%
1998
2002
2006
2010
2014
1998
2002
Forestry
2006
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
Deloitte Access Economics
68
2012 ITAB Market Effectiveness Report
Over the past few years exports to Japan have been in decline for three broad reasons: first,
the high Australian dollar, which has affected all export industries; second, the ailing
Japanese economy, which has driven a reduction in paper demand; and third, the
increasing preference by Japanese consumers for ‘green’ woodchips.
The elevated Australian dollar is eroding the competitiveness of Australian woodchip
exports against Japan’s other major woodchip suppliers – Chile (21% of imports in 2010-11),
South Africa (12%) and New Zealand (12%). Although historically Japanese mills have paid a
price premium for the perceived higher quality of Australian woodchips, this premium is
increasingly being worn away by the strong currency.
The declining demand from Japan has forced Australian woodchip producers to seek
alternative markets. Increasingly, China (including Taiwan) is becoming an alternative
market for woodchips, taking 17% of Australia’s total woodchip export in 2009-10. While
having an alternate market is certainly a positive, it is worth noting that exports to Japan
command a significantly higher price.
A key strength for Victoria is its production of coniferous woodchips. The State accounts
for around 70% of Australian coniferous chip exports and, while Japanese imports of
broadleaved chips are in decline, coniferous chips appear to be on the rise. Over the past
year, Japanese imports of coniferous woodchips have grown at an average monthly rate of
2%, while broadleaved imports have fallen at an average monthly rate of 2%.
This change in import composition may in part be due to Japanese consumers’ increasing
distaste for woodchips sourced from old growth native forests. Given that most of
Victoria’s woodchips are from coniferous plantation logs, the State is well positioned to
increase its exports to Japan.
On balance, however, given the challenges ahead for the construction industry, as well as
the elevated Australian dollar and broader uncertainty facing Australian woodchip exports,
employment in the sector may continue a modest downward trend which has been
apparent since 2006.
Occupations in demand and critical skill shortages
Response to 2011 critical skill shortages
In collaboration with a number of industry associations, VFITAB have progressed the skills
shortage agenda across each of forest technicians, forest land managers, mechanical
harvest operators and frame and truss estimators and detailers – albeit to differing
degrees.
Starting with forest technicians and managers, VFITAB in 2011 supported the Industry Skills
Council to develop the Advanced Diploma in Forest Industry Sustainability. Industry has
engaged in the development of this qualification with the motivation of increasing the
communication and leadership of qualities among new and existing production managers
(among other skills). It is also a signal to the industry of possible new career pathways, to
improve the attraction and retainment of skilled labour.
In terms of forest land managers, VFITAB has maintained links with private farm networks
and the Victorian Association of Forest Industries, in light of the emerging carbon farming
Deloitte Access Economics
69
2012 ITAB Market Effectiveness Report
initiative. The alternative pathways are for either the farmer or a contractor to perform the
harvesting task, although there has been little success in translating the demand from
either of these parties into training over the last 12 months. However, applications for the
initiative are invited in the first half of 2012, in which case the latent demand from both
parties is more likely to translate into enrolments.
Mechanical harvest operators are a perennial shortage, compounded by the emergence of
new technologies. VFITAB are continuing to negotiate a training delivery partnership
among RTOs and industry, with no Victorian provider currently in place to meet the training
needs arising from this more sophisticated technology. Formalisation of a Victorian training
partnership is anticipated in 2012.
In response to an ongoing shortage of qualified frame and truss estimators and detailers,
new qualifications have been developed and endorsed from Certificate II through to
Diploma level. VFITAB is currently working closely with the Frame and Truss Manufacturing
Association to promote the uptake of the new qualifications, which are likely to be available
from February onwards. Some 170+ existing workers hold the existing qualification and
could potentially up skill, in conjunction with new industry-led career pathways.
Occupations in demand and critical skill shortages in 2012
VFITAB notes that sophisticated new technology calls for advanced skills, and the timber
manufactured products sector has been moving towards adopting high technology
production systems (such as automated machines and manufacturing lines, and computer
aided design programs) requiring higher levels of computer operating skills.
Firms in the truss and frame sector use integrated information systems that allows realtime communication within the entire product cycle from product design to manufacturing,
and product delivery to the end user. Information systems and digital skills are essential
across the entire sector to support efficiency and competitiveness. Although the industry is
currently addressing this issue it is still unknown if this is going to provide a solution to the
shortage of these skills.
The tables below summarise the occupations in demand and experiencing critical skill
shortages in 2012. These occupation lists have been advised by VFITAB and have been
determined following formal engagement with industry.
Overall, there is an increase in the number of occupations listed as in demand compared to
2011, all of which are also listed as experiencing a critical skill shortage.
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Saw doctor
Pulp and paper technician
Saw maker and repairer (323315)
Paper and pulp mill operator (712916)
Detailer / Estimator
Forestry worker (841311)
Silviculture and harvesting team leaders
Forester (234113)
Wood machinist
Wood machinist (394213)
Forest technicians and land managers
Forester (234113)
Deloitte Access Economics
70
2012 ITAB Market Effectiveness Report
Occupations experiencing a critical skills shortage
Industry title
ANZSCO classification
Saw doctor
Saw maker and repairer (323315)
Pulp and paper technician
Paper and pulp mill operator (712916)
Detailer / Estimator
Forestry worker (841311)
Silviculture and harvesting team leaders
Forester (234113)
Wood machinist
Wood machinist (394213)
Forest technicians and land managers
Forester (234113)
The table below outlines qualifications which are required for occupations experiencing a
critical skills shortage.
Qualifications required for occupations experiencing critical skill shortages
Occupation (Industry title)
Qualification
Saw doctor
Pulp and paper technician
Certificate III in Saw Doctor
FPP10 ASCED Manufacturing Engineering and Technology
Detailer / Estimator
Certificate III in Timber Truss and Frame Design and Manufacturing
Silviculture and harvesting team leaders
Certificate III in Harvest and Haulage
Certificate III in Forest Growing Management
Wood machinist
Certificate III in Wood Machinist
Forest technicians and land managers
Advanced Diploma of Forest Industry Sustainability
Deloitte Access Economics
71
2012 ITAB Market Effectiveness Report
12
Furnishing
Coverage: Cabinet and furniture making, furniture polishing, picture framing,
glass and glazing, soft furnishings and upholstery, kitchen and bathroom
manufacturing, floor covering and finishing, mattress manufacturing, toy and
sporting goods manufacturing, laundry and dry cleaning.
Specific industry and business cycle drivers: the $A, sustainability policy,
COAG reform agenda, housing construction cycle.
Recent relative sectoral performance rating: Low
Expected relative sectoral performance rating: Below average
Summary of ITAB advice and consultation
Market effectiveness
FurnITAC report a number of market success and failures, largely relating to those
occupations that were in shortage in 2011. The examples of success demonstrate the
increased uptake and therefore viability of training where endorsed by industry. The
examples of failure relate to thin markets for particular training and a corresponding
substitution effect.
Examples of training market successes include an increase in enrolments in the Certificate
III in Picture Framing – from 5 in 2010 to 25 in 2011. Driving this improvement has been
the endorsement of the training by FurnITAC in conjunction with the Picture Framing Guild,
including for RPL among Guild members. A lack of new entrants to the sector remains an
issue.
The Certificate III in Glass has been revised to now incorporate two qualifications:
(1) stained glass and leading lighting; (2) glass and glazing. The motivation for revising the
qualification was to improve enrolment figures to ensure the continued provision of the
course by the existing training provider. It is hoped the new qualification will increase
overall enrolments in both sectors, thereby assisting the training provider to deliver flexible
training options and alleviating the additional costs incurred by regional apprentices and
enterprises.
In response to a shortage in designers among the cabinet making sector, technological
change and the need to formalise career pathways, the Certificate IV in Applied Design,
Kitchens, Bathrooms and Interior Spaces has been developed. There were difficulties in
identifying a suitable training provider, with a public provider requiring a minimum 20
enrolments for on-campus training only and at a specified commencement date. In
response to this, FurnITAC identified a private RTO who could offer flexible (workplacebased) training delivery and linked them with the Cabinet Makers Association. FurnITAC
endorsement supported the recognition of the course as an accredited traineeship,
meaning eligible enterprises will be able to access Commonwealth and VTG funding to
support course uptake.
Deloitte Access Economics
72
2012 ITAB Market Effectiveness Report
In terms of training market failures, thin markets continue to impact soft furnishings,
mattress and base making and blinds and awnings, resulting in the non-delivery of these
apprenticeships in Victoria. Instead the uptake of non-industry-specific Certificate III
traineeships is increasingly prevalent, which only partly meet industry skill needs and
further reduce the likelihood of industry specific training being viable in the future. This
situation is compounding the competitiveness issues these businesses face, particularly as
new technologies emerge.
Furthermore, VET in Schools and full-time pre-apprenticeship courses are causing some
concern among industry as to the varying delivery standards. Indeed crediting 12 months
of pre-apprenticeship training is said in many cases to be at odds with the productivity of
the apprentice and the award wage. That is, the industry would argue pre-apprentices are
at best half as productive as a 1-year apprentice from a non-school-based pathway, and as
such should not be paid an equivalent wage. As such there have been calls to reduce the
credit duration to 6 months and this has been accepted, implying the impact of this issue
should diminish going forward.
Change drivers and industry developments
FurnITAC reported a small number of change drivers for 2012, covering somewhat similar
demand and supply side developments to those impacting the industry in 2011:

Technological developments (demand side)

Shift in the model of training delivery (demand side)

Regulatory change (demand and supply side)

Economic conditions and trade patterns (supply side)
Accordingly, while macroeconomic factors are dictating the prosperity of the industry
overall, a number of microeconomic factors around technology and training delivery have
emerged through 2011-12 with implications for the future of specific sectors.
In terms of regulatory developments reducing employment opportunities in the industry,
the ‘Chain of Custody’ import regulation appears to be having less of an impact than initially
intended. Illegally logged timber is suspected to be classified by country of origin rather
than country of harvest, and thereby still making it into the country. Further there remains
a lack of knowledge among retailers of ethical and ecologically sustainable production
practices, and minimum quality standards among imported products remain voluntary.
On the other hand, and while initially set to take effect in 2012, the Council of Australian
Governments initiated national licensing of ‘building related trades’ has been pushed back
to 2013-14, thereby providing more time for those working in cabinet making and flooring
to attain their respective Certificate III and meet the licensing and accreditation
requirements. A spike in demand for RPL is anticipated once the timing for the reforms has
been confirmed.
For the most part, Australian furnishings continue to compete on quality rather than price.
However, with economic conditions declining consumers are typically less willing to pay the
difference. In order to remain viable, Australian furnishing manufacturers need to:

invest in new equipment to reduce production costs (including energy use);

ensure mandatory minimum standards are in place on imported product quality; and

empower retailers to raise awareness among consumers of illegally logged and/or
inferior products.
Deloitte Access Economics
73
2012 ITAB Market Effectiveness Report
However, the many small businesses that characterise the industry cannot affect these
changes, painting an uncertain future for employment and training in the sector,
particularly among the most vulnerable furniture making and upholstery sectors.
The continued sophistication of cabinet making – through the use of new computer aided
design and computer numerically controlled technologies – sustains the demand for new
training and apprentices in the sector. Similarly demand for training in blinds and awnings
continues and indeed compounds with strong growth in industry output and the
introduction of new technologies. However the lack of a training provider in Victoria is
leading to a level of unmet demand in this sector.
The take-up of higher order qualifications among existing industry workers remains low –
attributed to the perception that the training system is overly complex and time
consuming. Continued improvement in technical, management, marketing and finance
skills remain a priority for the sector. Further workplace training by RTOs is expected to
encourage the greater uptake of this training. Indeed as has been previously pushed-for by
industry, a split in the delivery of training – whereby TAFE delivers the theory off-site, while
simulated machinery training is delivered by an appropriate provider on-site – has emerged
through the support of public funding and structural change within TAFE.
Industry outlook
Like in many sub-sectors of Victoria’s manufacturing industry, employment in the furnishing
industry has been declining over the past decade. That trend is due to a myriad of
challenges facing manufacturing as a whole, as well as furnishing specifically. Indeed, while
solid employment growth over the coming year is expected to underpin income growth in
the State, a number of important challenges are likely to continue to hurt employment
growth in the furnishing industry.
The housing cycle is a key driver of demand for furnishings. However, over the past year,
house prices Australia-wide have fallen modestly. Sales volumes have also declined, and
rental yields remain modest despite rents rising at a modest pace.
The slump is evident in housing construction as well. Housing approvals are down by more
than one third compared with a year ago (to levels last seen in early 2009), and that
pipeline of decline has yet to be fully reflected in housing construction commencements.
That will have flow on effects for the furnishing industry: new home building and newly
renovated homes open up spending on furniture, fittings, carpets, curtains and the like. A
slowdown in housing is therefore likely to produce a slowdown in demand for furnishings.
An analysis of longer term spending trends points to further challenges, with spending on
furnishings by Australian households failing to keep pace with rising incomes over time. For
example, the Household Expenditure Survey published by the Australian Bureau of
Statistics showed that the average household’s expenditure on furniture and floor
coverings declining by 2% from 2003-04 to 2009-10. Over the same period, the average
household’s weekly expenditure on all goods and services rose by 38.5%.
Deloitte Access Economics
74
2012 ITAB Market Effectiveness Report
Chart 12.1: Employment outlook – Victorian furnishing industry
'000 persons
30
Forecast
Change on year earlier
40%
25
30%
20
20%
Forecast
10%
15
0%
10
-10%
5
-20%
0
Victoria
-30%
1998
2002
2006
2010
2014
1998
2002
Furniture
2006
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
In part, the decline in spending on furnishings reflects price deflation. Price deflation has
been the result of rising imports of furnishings from lower cost producers overseas,
technological improvements and, in recent years, the rise of the $A making imported
furnishings even cheaper.
A further challenge facing the industry is the easing in the rate of population growth in
Victoria over the last year, which dipped back to less than 1.5% through the year to mid
2011, down from more than 2.2% just two years earlier.
Chart 12.2: Skilled Vacancy Index – Victorian furnishing industry
Index: 2000 = 100
350
More
vacancies
300
250
200
150
100
Fewer
vacancies
50
0
1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011
Victoria (Total)
Cabinetmaker
Upholsterer
Flat glass tradesperson
Source: Commonwealth Department of Education, Employment and Workplace Relations
Domestic producers will also face additional challenges from importers of furniture and
components made more competitive by the continuing strength of the $A. Imports of
furniture for the purpose of consumption were $2.7 billion in 2010-11, having increased by
more than 27% over the past five years.
Deloitte Access Economics
75
2012 ITAB Market Effectiveness Report
The chart above shows that skilled vacancies for tradespersons in the furnishing industry
(as measured by DEEWR’s Skilled Vacancy Index) generally fell back slightly in 2011 in line
with both the Victorian average and the historical trend over the past decade.
Overall, and as the charts above show, Deloitte Access Economics expects the challenges
facing the furnishing industry to continue to weigh on employment prospects over the
medium term.
Occupations in demand and critical skill shortages
Response to 2011 critical skill shortages
Working in partnership with industry, FurnITAC have made some inroads to alleviating
critical skill shortages among glaziers, cabinet makers/installers, and flooring finishers in
2011, with further traction expected in 2012 as a critical mass of enrolments is built.
However, upholstery continues to decline and is close to collapse in terms of training
delivery.
FurnITAC has increased its involvement in school-based cabinet making career initiatives, in
an effort to boost both commencement and completions rates of apprenticeships to a level
that is on par with other building related trades. At the same time industry is increasing its
involvement in educating schools and the community more broadly on advancements in
technologies and career paths within the sector (supported by a new Certificate IV in
Cabinet Making which is expected to attract 50 enrolments in 2012). However, there is still
some way to go to reducing this skill shortage.
By way of alleviating critical shortfalls in glass and glazing tradespersons, and in light of the
persistence of only one Victorian training provider, FurnITAC supported the redevelopment
of the glass and glazing qualification to incorporate both the glass and glazing and stained
glass and lead lighting qualifications into the Certificate III in Glass. It is anticipated that this
will improve the viability of the course to ensure its sustainability and an increase in workplace training.
In terms of flooring finishers, an aging workforce with little formal training is slowly being
addressed by increasing new apprentice enrolments (although the completion rate has
declined). Industry has identified the need to provide a more supportive structure to its
apprentices, in terms of mentoring and moving away from the traditional multiple
supervisor arrangement. In response the Flooring Association is encouraging members to
undertake training from the training and education package to better equip for a mentoring
role.
Finally, upholstery remains in critical and declining circumstances, with only seven reported
enrolments in 2011. Course costs exceed revenue at this point, putting the future of the
qualification at serious risk. Competition from imported products continues to force the
closure of small upholstery businesses and compounds the difficultly of attracting new
entrants. Attempted partnerships with similar skilled sectors also experiencing thin training
markets have had mixed success due to varying employability at the end of these courses.
Occupations in demand and critical skill shortages in 2012
FurnITAC notes that the furnishing sector is generally struggling to meet the demand for
qualified tradespeople, and that this gradual reduction in enrolments has resulted in a
decreased availability of industry specific training. Where there is still a wide variety of
training providers available, such as cabinet making and furniture making, the number of
Deloitte Access Economics
76
2012 ITAB Market Effectiveness Report
candidates seeking to enter into these trade pathways has significantly reduced. This
reduction in student enrolments will ultimately jeopardise the future availability of training.
Moreover, as the workforce ages it is expected the ratio of qualified and experienced
tradespeople exiting the industry compared with newly qualified tradespeople entering will
only rise.
FurnITAC also notes that many other sectors have no industry specific training available to
them or, if there is a training provider, access is limited. An example of this is the glass and
glazing sector. Although this sector experiences consistent enrolments, in Victoria there is
only one training provider. As this RTO is metropolitan based and only offers classroom
based training, it creates extra pressure on regional enterprises and their apprentices in
terms of attendance. FurnITAC suspects that many potential enrolments are lost to other
(non industry-specific) training pathways or there is no training undertaken at all.
The occupations listed below are all trade pathways and as such the lead time for an
individual to reach full aptitude is lengthy. This issue continues to escalate as the average
employee age increases and training provider options decline.
The tables below summarise the occupations in demand and experiencing critical skill
shortages in 2012. These occupation lists have been advised by FurnITAC and have been
determined following formal engagement with industry.
Overall, there is a decrease in the number of occupations listed as in demand compared to
2011, though a higher proportion are listed as experiencing a critical skill shortage.
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Stained glass and lead lighting
Cabinet maker/installer
Glazier (333111)
Cabinetmaker (394111)
Furniture maker
Cabinetmaker (394111)
Furniture Finisher (394211)
Glass and glazing
Glazier (333111)
Designers (furniture and cabinet)
Industrial designer (232312)
Flooring installer
Floor finisher (332111)
Upholsterer
Upholsterer (393311)
Curtin, blind and awning maker and installer
Home improvement installer (821412)
Picture framer
Picture framer (394212)
Occupations experiencing a critical skills shortage
Industry title
ANZSCO classification
Stained glass and lead lighting
Glazier (333111)
Cabinet maker/installer
Cabinetmaker (394111)
Glass and glazing
Glazier (333111)
Flooring installer
Floor finisher (332111)
Upholsterer
Upholsterer (393311)
Curtin, blind and awning maker and installer
Home improvement installer (821412)
The table below outlines qualifications which are required for occupations experiencing a
critical skills shortage.
Deloitte Access Economics
77
2012 ITAB Market Effectiveness Report
Qualifications required for occupations experiencing critical skill shortages
Occupation (Industry title)
Qualification
Stained glass and lead lighting
Cabinet maker/installer
Certificate III in Glass
Certificate III in Cabinet Making
Glass and glazing
Certificate III in Glass
Flooring installer
Certificate III in Flooring Technology
Upholsterer
Certificate III in Upholstery
Curtin, blind and awning maker and installer
Certificate III in Soft Furnishings
Certificate III in Blinds and Awnings (n/a)
Deloitte Access Economics
78
2012 ITAB Market Effectiveness Report
13
Manufacturing and Engineering
Coverage:
Aerospace, Engineering (Fabrication trades), Engineering
(Mechanical trades), Engineering (Other), Mining, Shared – Metals and
Engineering, Automotive components, Chemical, Hydrocarbon and Oils, Nonmetallic Mineral Products, Plastics, Rubber and Cables.
Specific industry and business cycle drivers: Carbon trading schemes in
Australia and worldwide, the exchange rate, oil prices, raw material prices.
Recent relative sectoral performance rating: Average
Expected relative sectoral performance rating: Below average
Summary of ITAB advice and consultation
Market effectiveness
MESAB reports various examples of market success and failure in relation to training in the
manufacturing and engineering sector.
The Skills for Growth program (focusing on small and medium sized businesses) has proved
a success in the manufacturing sector, achieving higher than anticipated results. The results
for manufacturing are revealing – in the first quarter of 2011, 15.5% of the businesses
participating in Skills for Growth were in the manufacturing sector. This percentage is
significantly higher than the number of manufacturing businesses eligible for the program,
which is around 8.3%. More than 4,400 training placements have been made in
manufacturing businesses which represents 28.6% of all program placements into
accredited training.2
This indicates the potential for increasing training for people in the manufacturing sector.
Many employees need up-skilling or training as businesses consolidate and employees take
on additional work roles. However, the training needs to be developed in a flexible way to
accommodate on the job training.
One success story which stands out – and which was also noted in this report with respect
to electro-technology – has been in motor rewinding (or armature winding), which has
suffered the thin market problem for a number of years (enrolments have previously been
less than eight a year). Additionally, industry has been reluctant to have staff away from
the workplace for a significant length of time. However, an RTO was found who was
prepared to offer and develop training which was able to be provided at the workplace.
Crucial to the process was that an memorandum of understanding between industry and
the Bendigo Regional Institute of TAFE was developed, which says that if less than 14
students are enrolled in a year, then an industry fund will pay the costs associated with
running the program for a reduced number of students. This industry fund provides
2
Australian Industry Group – unpublished data.
Deloitte Access Economics
79
2012 ITAB Market Effectiveness Report
certainty for the RTO and industry alike, in ensuring sufficient funds are available to run the
Certificate III in Electrical Motor Repair.
The success in armature winding training was a joint effort between MESAB, EPIC Industry
Training Board, industry and training providers. MESAB was involved initially in securing
the funding, while EPIC is now ensuring that the training continues.
There have been difficulties for some time regarding training of people in welding skills.
While there is plenty of demand for this type of training, formal training has provided little
flexibility because it is predominantly attendance based. The training runs for 10-12 weeks,
and requires around four hours of attendance in each of those weeks. Employers are
unwilling to let employees off work for this length of time, while employees seem unwilling
to undertake the training at night school due to family commitments. However, in 2011
MESAB acted as a broker between a welding, pipe and mechanical services firm (who had a
need to upgrade existing welding tradespersons to Certificate IV due to the complexity and
technical nature of new projects) and an RTO to facilitate training on site by a resident
subject expert. The training was completed with an examination off-site. MESAB is hopeful
that this flexible training arrangement will be able to be provided to other companies (and
in different regions) as a means to alleviate critical skills shortages in this area.
While there has been a 20% increase in reported enrolments overall in Victoria in
occupations experiencing a shortage3, there has been a decline by 2-3% in manufacturing
and mechanical workers over the same time. Additionally, while there has been an
increase generally in the number of apprenticeship enrolments over the last five years,
enrolments in engineering apprenticeships are still trending downwards. This highlights the
problems in both attracting students to the courses, and finding training providers to
deliver the training in a format that is suitable for industry, which is an ongoing market
failure in the training space.
Recently a national recruitment agency endeavoured to run a series of government-funded
engineering pre-vocational access programs in Colac and Ballarat. However there was not
enough interest from job seekers for the program. It is unlikely that this will be offered
again in 2012, unless it can be demonstrated that there is greater interest from school
leavers and job seekers.
Although MESAB has not been able to make a positive determination, it is likely that
boatbuilding apprentice training will cease in Victoria in 2012. Victoria University is the
sole provider and has advised employers that apprenticeship training in 2012 is in doubt.
The boatbuilding industry employs around fifteen new apprentices each year, presenting a
problem of thin markets. The training is also expensive to deliver, which is why the
program is likely to be cut.
Indeed this has been the response across the board from public TAFE providers that deliver
qualifications with low student numbers and high cost of delivery, including foundry,
patternmaking, aerospace, watchmaking, fabrication at Hawthorn (Swinburne) and welding
(at Victoria University Melton, RMIT and potentially at Ballarat University – Horsham this
year). For the same reason that public training providers are not offering the courses,
private providers are not taking them up. This is leading to the situation where people
wanting the training in Victoria have to look interstate (or overseas) in order to access it.
3
Victorian Training Market Quarterly report Q3 2011 p34-35.
Deloitte Access Economics
80
2012 ITAB Market Effectiveness Report
When formal training is not available, people are being trained on the job instead, which
can be quite specific, and not transferrable to another workplace. This means that people
no longer have a formal qualification to take to the labour market when looking for a new
job, and it also makes it more difficult for employers seeking new workers, as they are
unable to find people with a formal qualification.
Interest in the Training and Assessment qualification by manufacturing and engineering
tradespeople has also been low. In some sectors, there may only be one teacher in Victoria
able to undertake the training. Given the ageing nature of the workforce, and
manufacturing and engineering teachers specifically, there is an urgent need to train people
in the necessary skills to deliver the training in the future.
There is a common complaint from manufacturing enterprises that training providers are
not meeting their needs. This is true for both the way in which training is delivered, and
also the content being delivered. As mentioned earlier, most training has a requirement for
a certain number of contact hours, which is often unable to be met by employers who need
the person at the workplace. Additionally, there is often a disconnect between the skills an
employer requires, and the content provided during the training (which could be due to
issues such as not keeping up with advancements in technology and new infrastructure
requirements).
Change drivers and industry developments
MESAB has reported that very little has changed from 2011 in terms of key change drivers
and industry developments. The key change drivers identified are:

New market regulation (demand side)

High Australian dollar (demand side)

Declining share of research and development funding (demand side)

NBN rollout (demand side)

The emissions trading scheme (supply and demand side)

The ongoing mining boom (supply side)

The ageing workforce (supply side)
Additionally, MESAB has reported concern from industry regarding apprenticeships.
Engineering apprenticeships are undertaken on the competency based progression and
completion system, and the engineering industry is covered by the only Federal award that
has a progression payment requirement. That is, as an apprentice completes 25% of their
training, they are entitled to a pay increase.
MESAB’s view is that the way in which competency based progression and completion has
been implemented in Victoria aligns with the traditional TAFE training timeframe of the
past (that is, three years of off-job training). Without the distinction between the
traditional three years of off-job training and four years of on-job training with the
employer, employers are now faced with a three year apprenticeship. That is driving many
employers to reconsider taking on an apprentice, preferring to train in-house instead.
This is augmenting the problem of other employers being unable to find suitable candidates
for apprenticeships (that is, students who have completed a pre-apprenticeship).
Addressing the problems surrounding a lack of apprentices will be an ongoing focus for
MESAB and industry over 2012.
Deloitte Access Economics
81
2012 ITAB Market Effectiveness Report
The mining boom continues to be an ongoing problem for this sector. It is reported that
BHP is looking for around 5,000 workers in South Australia in 2012 for work on Olympic
Dam, which will attract a range of tradespeople, including fitters, boilermakers and
engineering tradespeople. This will occur at a time where many Victorian employers are
already having difficulty filling vacancies for these trades, as these industries are unable to
compete with wages in the resources sector. MESAB will attempt to encourage a greater
number of apprenticeships in skill shortage trades in an attempt to address the problem.
The emissions trading scheme is expected to drive change in the manufacturing and
engineering industries, including requiring existing employees to have new skills such as
auditing and the ability to use new technology to reduce emissions. These changes will
require changes to training packages (although all qualifications currently have a core unit
focussing on sustainability) to incorporate these new requirements as they occur.
There appears to be a shift underway of increasing demand to up-skill employees. The
higher skills required are usually those that increase flexibility, and provide a greater means
to adapt to change. For example, there has been an increase to up-skill workers to
Certificate III and IV in process manufacturing. While this shift is not yet predominant,
there is a general feeling that, given the extremely competitive nature of the manufacturing
market, up-skilling (including skills in lean manufacturing and other ‘green’ skills) of
employees is required in order to survive in the market. Advice gathered by MESAB
suggests that there may be an increase in the number of people undertaking the Certificate
IV in competitive manufacturing and Certificate III in process manufacturing over the next
couple of years.
Aviation may have new licensing requirements in 2012. Training packages are already in
place, although some units will need to be changed in order to meet the new requirements.
It is anticipated that most current workers will complete the training in 2012, which will
mean a large influx of people being trained. However, these won’t be new certificates
being undertaken, but a few units to meet licensing requirements.
The ageing aviation workforce however, will mean that more qualified workers are needed.
For example the average age of a licensed aircraft maintenance engineer is 58, indicating
that retirements will pick up from here. Apprenticeships take four years, and employers
are already finding it difficult to find qualified workers. The ageing manufacturing
workforce is presenting an ongoing problem. However industry is attempting to overcome
these difficulties by attracting younger people, particularly women. In order to achieve
this, there have been attempts to redesign jobs to make them less physical, and to create
more flexible work rosters.
The high Australian dollar continues to squeeze manufacturing companies in Victoria,
particularly those manufacturing low tech, labour intensive products. However, there have
been some success stories with small companies venturing into internet marketing of their
products. This creates the need for more innovative and adventurous skills development,
which is difficult to meet, usually because these small companies do not have the resources
to undertake training.
Broadband is making it increasingly easier for small businesses to market their products
worldwide, and increased file size capability means that businesses can compete anywhere
in the world. In particular, design work utilises broadband to communicate new designs
Deloitte Access Economics
82
2012 ITAB Market Effectiveness Report
(especially when it comes to prototyping), and it is hoped that there is increasing exports in
this area in the future.
The declining share of research and development (R&D) in Victoria is an ongoing problem
for Victoria’s manufacturing sector. R&D uses a great deal of manufacturing and a decline
in this spending contributes to further relative decline in VET trained R&D workers, which
impacts ultimately on the manufacturing sector. Unless there is an increase in the amount
of R&D conducted in Victoria, this will put further pressure on a sector already in decline.
Industry outlook
The manufacturing and engineering industry is comprised of a number of varied subsectors. For the broader manufacturing sector, output has been declining as a share of the
State economy over time. That relative decline is part of a trend evident in most advanced
economies, including other Australian States.
An important driver of that trend has been stronger competition in manufacturing from
emerging economies. Important cyclical drivers are also relevant, including the high value
of the $A and relatively high interest rates. The mining sub-sector (included within the
coverage of this ITAB) has a brighter outlook, driven by the resources boom, though
concerns remain over the longer term future of brown coal.
The Victorian mining sector comprises of coal, oil and gas, and base metals and minerals.
The story of Australia’s resources boom is well known, and although Victoria’s mining
sector is relatively small, it is also likely to experience above average performance over the
short term.
Victoria’s oil and gas sector will be an important driver of the outlook. Around 80% of
eastern Australia’s known gas reserves (and potentially significant undiscovered reserves)
are contained within the waters between Victoria and Tasmania. The Kipper Tuna Turrum
Project is a multi-billion dollar project currently under development in the Bass Straight
which aims to further develop natural gas supplies in the Kipper, Tuna and Turrum oil and
gas reservoirs. The project is expected to be completed in 2012-13.
Chart 13.1: Employment outlook – Victorian manufacturing and engineering industry
'000 persons
250
Forecast
Change on year earlier
8%
Forecast
6%
200
4%
2%
150
0%
100
-2%
-4%
50
-6%
0
Victoria
-8%
1998
2002
2006
2010
2014
1998
Manufacturing and engineering
2002
2006
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
Deloitte Access Economics
83
2012 ITAB Market Effectiveness Report
While natural gas is regarded as a relatively clean energy source, Victoria has traditionally
relied heavily on high-emission brown coal for its electricity generation due to significant
deposits around the State. The introduction of a carbon tax by the Federal Government in
2012 will have a significant impact on the industry.
The metal manufacturing sector is downstream from the mining industry and, like mining,
tends to follow the global demand cycle. As such, the metal manufacturing sector should
continue to benefit from a slow recovery in advanced economies, and solid growth in
emerging economies.
The Federal Government’s carbon price will significantly impact the metal manufacturing
sector, since activities such as aluminium production are highly emission intensive and
trade exposed. For this reason, these activities within the sector will be eligible for
assistance under the Federal Government’s Jobs and Competitiveness compensation
package.
The plastics and chemicals sector has been in decline for several years, largely due to
competitive pressures from Asia. A low level of investment in Australian plastics and
chemicals plants has also been evident. At present, the high level of the $A is posing
additional challenges. On a brighter note, favourable seasonal conditions have resulted in
stronger agricultural production, which may result in an increase in demand for chemical
fertilisers. Finally, as with metal manufacturing, the introduction of carbon pricing in 2012
creates uncertainty for the sector. Overall, the long term decline for the plastics and
chemicals sector, and the difficulties posed by the $A and carbon pricing suggest that the
outlook for the sector is not strong.
Chart 13.2: Skilled Vacancy Index – Victorian manufacturing and engineering industry
Index: 2000 = 100
1000
More
vacancies 900
800
700
600
500
400
300
200
Fewer 100
vacancies
0
1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011
Victoria (Total)
Mechanical engineer
Fitter
Toolmaker
Source: Commonwealth Department of Education, Employment and Workplace Relations
The chart above shows relatively few skilled vacancies for tradespersons in the
manufacturing and engineering industry (as measured by DEEWR’s Skilled Vacancy Index).
In part that may reflect ongoing consolidation in the industry over time, with specialist skills
still in high demand, as discussed in the following section. Given that the index tracks the
Deloitte Access Economics
84
2012 ITAB Market Effectiveness Report
number of advertisements, the results may also reflect a trend for some employers to
withdraw from advertising after repeatedly failing to fill vacancies. Overall, Deloitte Access
Economics expects employment in Victoria’s manufacturing and engineering industry to
remain relatively flat over coming years with the strong outlook for mining offsetting an
expected weaker performance across manufacturing.
Occupations in demand and critical skill shortages
There were eight occupations identified in the 2011 report as experiencing a critical skills
shortage. Locksmiths and jewellers have not been included in the 2012 list. However, this
is not due to a large surge in numbers of people gaining the relevant qualifications, but due
to a fall off in demand for these occupations.
Web promotions were run by MESAB to try to increase interest in undertaking the
qualifications for aircraft maintenance engineers, jewellers, fabrication tradespersons, airconditioning and refrigeration mechanics and sheet metal trades workers. In the case of
aircraft maintenance engineers, GippsAero trained 17 apprentices on the job to alleviate
their need for employees with these qualifications.
The tables below detail the occupations in demand and in critical shortage in the
manufacturing and engineering sector. Those listed as in demand generally reflect
occupations for which industry finds it difficult to fill positions and where apprentice
numbers are insufficient.
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Aircraft Maintenance Engineer (Mechanical)
Aircraft Maintenance Engineer (Avionics)
Aircraft Maintenance Engineer (Mechanical) (323112)
Aircraft Maintenance Engineer (Avionics) (323111)
Aircraft Maintenance Engineer (Structures)
Aircraft Maintenance Engineer (Structures) (323113)
Civil Engineering Draftsman
Civil Engineering Draftsperson (312211)
Engineering Manager
Engineering Manager (133211)
Mechanical Engineer
Mechanical Engineer (233512)
Mechanical Engineering Draftsman
Mechanical Engineering Draftsperson (312511)
Metal Fabricator (Boilermaker)
Metal Fabricator (322311)
Mining Engineer
Mining Engineer (excluding Petroleum) (233611)
Production Manager (Mining)
Production Manager (Mining) (133512)
Production or Plant Engineer
Production or Plant Engineer (233513)
Sheetmetal Trades Worker
Sheetmetal Trades Worker (322211)
Ship’s (Marine) Engineer
Ship’s Engineer (231212)
Welder (First Class)
Welder (First Class) (322313)
Engineering Technologist
Engineering Technologist (233914)
Air-conditioning and refrigeration mechanic
Air-conditioning and refrigeration mechanic (342111)
Metal Machinist
Metal machinist (First Class) (323214)
Metal Fitters and turners
Metal Fitter and Turner (323212)
Deloitte Access Economics
85
2012 ITAB Market Effectiveness Report
Occupations experiencing a critical skills
shortage
Industry
title
Sheetmetal
Trades Worker
ANZSCO classification
Aircraft Maintenance Engineer (Mechanical)
Aircraft Maintenance Engineer (Mechanical) (323112)
Aircraft Maintenance Engineer (Avionics)
Aircraft Maintenance Engineer (Avionics) (323111)
Aircraft Maintenance Engineer (Structures)
Aircraft Maintenance Engineer (Structures) (323113)
Metal machinists
Metal machinist (first class) (323214)
Air-conditioning and refrigeration mechanic
Air-conditioning and refrigeration mechanic (342111)
Metal Fabricator (Boilermaker)
Metal Fabricator (322311)
Metal fitters and turners
Metal Fitter and Turner (323212)
Sheetmetal Trades Worker (322211)
The table below outlines qualifications which are required for occupations experiencing a
critical skills shortage. Note that some occupations have the same certificate listed for
different occupations. Different occupations would complete different units within the
same certificates in order to specialise in their field.
Qualifications required for occupations experiencing critical skill shortages
Occupation (Industry title)
Qualification
Sheet metal trades workers
Aircraft maintenance engineers
Certificate III in Engineering – Fabrication trade
Certificate IV in Aeroskills (Avionics, Mechanical and Structures)
Metal machinists
Certificate III in Engineering – Mechanical trade
Air-conditioning and refrigeration
mechanic
Fabrication tradesperson
Certificate III in Engineering – Mechanical trade
Metal fitters and turners
Certificate III in Engineering – Mechanical trade
Deloitte Access Economics
Certificate III in Engineering – Fabrication trade
86
2012 ITAB Market Effectiveness Report
14
Primary Industries
Coverage: Agriculture, production horticulture, amenity horticulture,
conservation and land management, animal care and management, seafood
and aquaculture.
Specific industry and business cycle drivers: climate change, water security
and pricing, environmental policy, the $A.
Recent relative sectoral performance rating: Below average
Expected relative sectoral performance rating: Average
Summary of ITAB advice and consultation
Market effectiveness
Primary Skills Victoria (PSV) has reported a number of examples of market success, and
some ongoing market failures centred on the quality of training in particular areas. The
examples of success demonstrate an increased uptake of training in otherwise thin markets
(in a number of cases through the financial support of industry).
In collaboration with the Nursery and Garden Institute of Victoria, PSV supported
recruitment and retention as part of the industry cadetship program in wholesale
nursery. In particular PSV have reinforced the engagement between industry and the
principle RTO, to develop a training strategy that supports mentoring, retention, credibility
and quality. This otherwise thin market is now providing continuous prevocational training
to 20 cadets per annum, and advanced standing into an apprenticeship, as part of a new
industry workforce development plan.
With the funding and support of the Australian Wool Industry, PSV has been working with
secondary schools, RTOs and industry to develop training opportunities throughout rural
and regional Victoria (in the form of shearing schools). These schools introduce young
people to career opportunities and vocational training, and provide prevocational training
that can be credited against a Certificate II/III in Shearing. In line with these efforts (and the
revival of the wool/prime lamb market) enrolments in shearing have increased from 69 to
123 in 2011.
Across a range of other areas of skill shortage, strong increases in the uptake of training
have been observed in 2011. This includes:

Advanced Diploma of Rural Business Management;

Certificate III in Agriculture (Horse Breeding);

Certificate III in Rural Business;

Certificate IV in Agriculture;

Certificate IV in Sustainable Environmental Practises;

Diploma of Production Horticulture;

Certificate IV in Arboriculture.
Deloitte Access Economics
87
2012 ITAB Market Effectiveness Report
The view of PSV is that in many cases this is driven by RPL more so than additional skilling.
A notable exception is arboriculture which has involved up-skilling in line with improved
industry engagement.
In terms of training market failures, PSV continues to voice concern around the quality and
integrity of training, particularly in terms of RPL in specific industry sectors, and VET
teaching qualifications as it relates to pedagogy and industry currency. This includes the
translation of the VCE to a Certificate II, thereby side-stepping industry specific
foundational skills.
Change drivers and industry developments
PSV have reported a number of industry change drivers for 2012, many of which compound
from 2011. They include:

Biosecurity awareness and regulation (demand side)

Advancements in farming systems (demand side)

Consumer demand for amenity horticulture and landscaping (demand side)

Increasing public land conservation task (demand side)

Growth of the Victorian biotechnology sector (demand side)

Rationalisation of Victorian farms (demand and supply side)

Carbon farming initiative commencement (demand and supply side)

Developments in production horticulture (demand and supply side)
Local and global agendas and market movements are creating new opportunities for upskilling in primary industries, while consolidating some lower-level historical training.
The on-going rationalisation of Victorian farms into larger corporate/investment structures,
in order to generate economies of scale and scope and thereby remain competitive, is
changing the pattern of demand for on-farm skills. Indeed there is an increased demand
for professionally trained farm managers with a range of production and operational skills
(particularly resource management), with training at the Certificate IV and Diploma level
required to develop these (most likely up-skilling existing workers).
At the same time, issues around water security remain pertinent in the Murray Darling
Basin and continue to result in the sale of farms under the Federal Government’s Rural
Readjustment Scheme. As farm buy-backs reduce the demand for traditional on-farm skills,
they also create the need to re-skill that labour. Furthermore the reduced water security
forces change in irrigated farming practise among those who remain on the land, as it
relates to monitoring and maintaining water quality, thereby generating training demand in
the design and management of more sophisticated farming/irrigation systems.
With the high $A and other trade developments increasing the volume of imports to
Australia, the subsequent quarantine/biosecurity risks are putting the quality of both
Australian and imported produce in jeopardy. Outbreaks of pests and diseases threaten
production and demand higher order skills in pest and disease management in response,
including skills to detect, contain and control. The sophistication of these techniques
implies training at the Certificate IV and Diploma level is required – though this training
currently sits within agricultural departments and must be brought into the training system
to allow better dissemination.
Deloitte Access Economics
88
2012 ITAB Market Effectiveness Report
Increasing demand for amenity horticulture and landscaping across Victoria (particularly
inner city and new residential areas) is driving demand for new and more abundant skills.
The industry response has been to support increased wholesale nursery apprenticeships.
To ensure consumer demands are met, increased training in new urban irrigation systems,
drought and disease tolerant plant species, landscape design (and project management)
and retail nursery – at the Certificate III to Diploma levels – will also be required.
Conversely, increased pressure has been placed on areas of Victoria’s production
horticulture sector, due largely to competition from overseas production. Farm closures
and the loss of skills and expertise in more marginal regions exacerbate already thin
demand for new training. This is to the detriment of those producers that remain in
operation, who are under increased pressure to up-skill to attain greater production
efficiencies, particularly as it relates to irrigation systems, specialist crop production,
equipment and agri-tourism (which requires Diploma level qualifications).
In terms of managing Victoria’s natural resources, structural change in the Murray Darling
Basin continues to place pressure on monitoring and maintaining the health of the river
environment (enabled by the Diploma of Sustainable Water and Catchment Management
and some lower order skills at the Certificate III/IV level). At the same time, policy
commitments to reduce fire risk across the state again place increased demands on public
land managers to both train and recruit skilled labour (at the Certificate III/IV level).
The Carbon Farming Initiative commences in 2012. The implication of this initiative is the
need to consider the allocation of farming land to long-term forestry and subsequently the
modification of farming practises. A level of skill in species selection, establishment,
maintenance, management and carbon accounting will be required within the industry
(with the rest contracted in). Indeed this is likely to result in the creation of a new
occupation that may sit across the primary and forestry industry sectors – with Diploma
level training likely to be the starting point.
Following from this, advancements in farming systems therefore relate not only to the
changing size and structure of farms, but also the potential benefits of greater
environmental efficiencies and sustainability. Carbon sequestration, waste reduction and
bio-fuel production each provide avenues to reduce production costs and/or increase
revenues, to the benefit of farming viability. Flexible training delivery will be required to
ensure the uptake among existing farmers, and will need to be sufficiently grounded in the
application of emerging technologies. This would also be supported through increased
agronomists.
Finally, in terms of Victoria positioning itself as a global biotechnology hub, a major barrier
to this is the availability of animal technologists. Breeding and management of laboratory
animals (in animal houses attached to human health research institutes) requires training at
the Diploma level. It is hoped that improved opportunities for students to undertake work
placement as part of their training will go some way to addressing this, as well as the upskilling of existing Certificate III holders.
Industry outlook
Over many decades, employment in the primary sector has been declining as a share of
total employment. This reflects structural factors including an increase in the share of
consumer expenditure that has gone to services, strong productivity growth in Australian
Deloitte Access Economics
89
2012 ITAB Market Effectiveness Report
agriculture, declining prices of some agricultural commodities relative to other products,
moderation of government support and a reduction in trade protection. However, the
short term outlook is not necessarily one of decline. Key drivers over the short term
include weather conditions, commodity prices, and the $A.
Victorian farmers enjoyed a bumper crop in 2010-11. Seasonal conditions have once again
been favourable in 2011, with good winter rainfall improving yield prospects for the winter
crop. As a result, the short term outlook for Victorian crop production remains positive,
with ABARES forecasting Victorian crop production to again above average in 2011-12.
The rainfall that boosted crop production was also a blessing for irrigation-dependent farms
in the Murray–Darling Basin. Water storages in Murray–Darling Basin dams are now just
below 80% of capacity, compared with 52% a year ago. For the first time since 2002-03, all
northern Victorian systems received an allocation at the opening announcement on 1 July.
This is a major positive for northern Victoria’s dairy industry, which has been struggling with
water shortages for a number of years.
Agricultural commodity prices have increased since 2009-10, supporting the earnings of
agricultural producers. The increase in agricultural commodity prices in 2010-11 has been
broad based, with the prices of major crops such as wheat, barley and canola rising, while
dairy prices remain relatively high. Prices received for livestock have also increased in
2010-11. ABARES is forecasting agricultural prices to remain at an elevated level through
2011-12.
Chart 14.1: Employment outlook – Victorian primary industry
'000 persons
120
Forecast
Change on year earlier
15%
100
10%
80
5%
60
0%
40
-5%
20
-10%
0
-15%
Forecast
Victoria
Primary
1998
2002
2006
2010
2014
1998
2002
2006
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
However, the elevated $A has partially diminished the return to Australian farmers from
rising $US commodity prices. Looking ahead, $A movements will continue to be an
important driver of returns for the industry. In the short term, Deloitte Access Economics
expects the $A to remain well supported by high resource prices and Australia’s relatively
higher interest rates compared with other developed economies. Looking further forward,
however, the $A is projected to decline closer toward its longer term average.
Finally, the Federal Government has now confirmed that its carbon pricing scheme, which
will be introduced in 2012, will not include agricultural emissions. As a result, there will be
no requirement for farmers to pay for emissions from livestock or fertiliser use. Moreover,
the carbon price will not apply to off-road fuel use by the agriculture, forestry and fishing
Deloitte Access Economics
90
2012 ITAB Market Effectiveness Report
industry. Despite these assistance measures, there will be extra costs imposed by the
impact of the carbon price on some goods and services that are consumed by farmers and
other producers in primary industry, notably electricity costs.
In addition, the Federal Government will be spending around $1.5 billion over the next six
years on initiatives that aim to reduce the emissions of the agricultural sector. The Carbon
Farming Initiative will allow farmers and land managers to earn credits for activities such as
revegetation, savannah fire management, and reductions in emissions from livestock and
fertiliser. Credits may then be sold to other businesses wanting to offset their own carbon
emissions. Meanwhile, the Biodiversity Fund initiative will provide funding for landholders
to undertake projects that establish, restore, protect or manage biodiverse carbon stores,
while the Carbon Farming Futures initiative will support research and development and
other activities that will assist farmers and landholders to reduce emissions and store
carbon.
Overall, after a fall in primary industry employment4 in 2011, employment is generally
expected to remain relatively steady in the industry over the medium term.
Occupations in demand and critical skill shortages
Response to 2011 critical skill shortages
In response to the three most critical skill shortages faced by the Victorian primary sector in
2011 – animal technicians, arborists and agronomists – PSV has worked with industry to
formulate what are hoped to be long-term solutions. The solutions have centred on the
formalisation of new qualifications and career pathways, where industry has ownership
over the outcomes and PSV is the facilitator.
For animal technicians, having identified the skills required in collaboration with the Walter
and Eliza Hall Institute, PSV facilitated an in-house training relationship with Box Hill TAFE
(at the Diploma level). It is ultimately hoped that the program will take up to 40
enrolments per year, in order to better satisfy industry demand.
In terms of arborists, consultation with industry associations has resulted in industryagreed skill requirements, along with industry support of arboriculture as a licensed trade
to improve career pathways and industry skill retention. Accordingly the take-up of upskilling at the Certificate IV level was high in 2011, and will need to remain at 60-80
enrolments per annum to ensure demand is met (and translates to increased enrolments at
the Diploma level).
Agronomists, who are supporting the on-going structural change in agriculture and the
application of new farming technologies and techniques, have benefited from the State
registration of the Diploma of Agronomy. Enrolments in the course are growing steadily,
despite the overlap with the higher education system, with 50-60 enrolments required per
annum to satisfy current levels of demand.
4
For the purpose of employment forecasts, primary industries are defined across numerous ANZSIC categories,
the largest of which is sheep, beef cattle and grain farming, followed by dairy cattle farming. This classification
does not include the forestry sector. Note that concordance issues between ANZSIC industry classifications and
ITAB industry coverage is particularly relevant in the Primary sector. Imperfect alignment between the two
industry classifications and a rising tendency for the primary sector to provide a secondary source of income for
individuals means that a concordance from the ANZSIC industry employment data is likely to understate the
number of persons employed in the sector.
Deloitte Access Economics
91
2012 ITAB Market Effectiveness Report
Occupations in demand and critical skill shortages in 2012
The tables below summarise the occupations in demand and experiencing critical skill
shortages in 2012. These occupation lists have been advised by PSV and have been
determined following formal engagement with industry.
Overall, similar occupations are listed as in demand compared to 2011, though a greater
proportion is listed as experiencing a critical skill shortage. The inclusion of greenkeepers
and parks and gardens workers on the list of occupations in demand relates in part to the
increased demand for horticulture and landscaping across Victoria discussed earlier, along
with changes in climate and increased bushfire risk around the State.
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Arborist
Vegetable grower/farm worker
Arborist (362212)
Vegetable grower (121221)
Vegetable farm worker (841214)
Nursery worker
Nurseryperson (362411)
Gardener
Gardener (general) (362211)
Greenkeeper
Greenkeeper (362311)
Grain/oilseed/pasture grower
Grain, oilseed or pasture grower (121214)
Agricultural / horticultural mobile plant operator
Agricultural mobile plant operator (721111)
Pig farmer
Pig farmer (121318)
Dairy farmer
Dairy cattle farmer (121313)
Mixed livestock farm worker
Mixed livestock farm worker (841513)
Sheep farmer
Sheep farmer (121322)
Aquaculture farmer
Aquaculture farmer (121111)
Aquaculture worker
Aquaculture worker (841111)
Animal technician
Life science technician (311413)
Agronomist
Agricultural consultant (234111)
Parks and gardens worker
Gardener (General) (362211)
Biosecurity officer
Quarantine officer (311313)
Occupations experiencing a critical skills
shortage
Industry
Arborist title
ANZSCO classification
Animal technician
Life science technician (311413)
Agronomist
Agricultural scientist (234112)
Greenkeeper
Greenkeeper (362311)
Parks and gardens worker
Gardener (General) (362211)
Arborist (362212)
The table below outlines qualifications which are required for occupations experiencing a
critical skills shortage.
Deloitte Access Economics
92
2012 ITAB Market Effectiveness Report
Qualifications required for occupations experiencing critical skill shortages
Occupation (Industry title)
Qualification
Arborist
Certificate III in Arboriculture
Diploma of Arboriculture
Animal technician
Diploma of Animal Technology
Agronomist
Diploma of Agronomy
Parks and gardens worker
Certificate III in Parks & Gardens
Diploma of Parks & Gardens Management
Greenkeeper
Certificate III in Sports Turf Management
Diploma of Sports Turf Management
Deloitte Access Economics
93
2012 ITAB Market Effectiveness Report
15
Racing
Coverage: Racing – including harness and greyhound racing
Specific industry and business cycle drivers: rate of baby boomer retirement
(more people to spend more time at the track and increased opportunity to be
involved in racing pursuits) and, over the longer term, differential demand by
age (the potential for individuals to become more active bettors as they age).
Recent relative sectoral performance rating: Low
Expected relative sectoral performance rating: High
Summary of ITAB advice and consultation
Market effectiveness
The view of Racing Victoria is that, in general, the training required by industry has been
met by the training providers. However this is largely due to additional funding provided by
Racing Victoria or due to mandatory requirements for training in order to gain a license.
For example, in 2009 the Racing Victoria Board approved funding of $400,000 over two
years to support the mandatory training of stable employees to ensure that participants
had the necessary skills and knowledge to perform duties efficiently and safely. From
August 2011 all stable employees have been required to complete this training to be
registered and Integrity Services ensures that compliance is being monitored by relevant
participants across the industry.
Over the two years, 2,768 participants have undertaken and completed the required
training with a range of providers. This initiative has established a minimum standard for
new entrants and upskilled the existing workforce.
Additional benefits of the mandatory training has been that a number of participants have
undertaken full Certificate II and III courses as opposed to just the two compulsory units,
either at their own initiation, or at the suggestion of their employer, industry body or
training organisation. Also, the training helped to identify literacy and numeracy problems
(particularly among older workers), who were reluctant to undertake training. Racing
Victoria worked directly with these people, assisting them to complete any paperwork and
further helping them through the process.
A 2010 pilot program designed to address the shortage in track riders was delivered over
2011. The track rider program continues to be delivered in partnership with South West
TAFE (Glenormiston), and is also supported through a Federal funding grant received with
assistance from Agrifood Skills Australia.
The program has run camps at the intermediate and advanced level. Industry placements
are generally made following competency at the advanced camps. However, some
placements have been made following intermediate camps. All ten students from the
Deloitte Access Economics
94
2012 ITAB Market Effectiveness Report
January 2011 advanced camp are employed as track riders. Six of the eight students from
the January 2012 advanced camp are employed, while one is in the process of being placed
and one is undertaking further development.
It is anticipated that there will be approximately 48 students participating in the camps in
2012. This will go some way to alleviating the track rider shortage, although it is thought
that even if all 48 students graduate in 2012, track riders will remain in demand in 2013.
While there are many examples of successes in the training market, none of them would
have eventuated without some intervention, usually in the form of additional funding or in
the form or mandatory training. This is often due to the higher cost of running an equine
based unit (as opposed to, for example, an OH&S or business unit).
The racing industry is suffering from an undersupply of instructors and trainers. There is a
strong need for instructors given the volume of mandatory training within the industry.
However, RTOs often have difficulty finding instructors and trainers who are able to deliver
the required content at high standard. The implication for RTOs is that they can’t offer
courses for as many people, or can’t offer courses as often as is demanded.
The problem of thin markets also emerges, for example in relation to steward training.
There are very few stewards in the industry, and so the demand for training is often only
for one or two people. A course is currently being run by the University of Ballarat across
all three codes and Racing Victoria is working collaboratively to develop alternative training,
including online, that can be delivered to small groups or individuals.
Change drivers and industry developments
Racing Victoria reported several change drivers for 2012 that have been identified during
consultations with stakeholders. They are:

Ongoing training due to mandatory OH&S requirements (demand side)

The new license agreement with TABCORP (demand side)

A lack of new workers into the industry (supply side)

Emerging shortage of qualified teachers of equine units (supply side)
Racing Victoria now requires certain OH&S training in its suite of mandatory training units.
This means the move towards the national harmonisation OH&S will not affect the Victorian
Racing industry as it may other industries (as the proposed changes are already part of the
training package). However, mandatory training will continue to affect training demand. In
particular, the demand for traineeships, Certificate II and III should remain high.
A significant change driver for the Victorian racing industry in 2012 will be the new licence
agreement that has just been negotiated with TABCORP spanning 12 years. This agreement
provides some certainty for the industry, and resolves many issues which were unforseen
when the previous agreement was signed in 1994 (including internet wagers) and also
covers the structure of how racing will operate with various wagering groups.
This change means that there is now a greater need for people working in the racing
industry to have certain business skills. While there are some business units currently
available in the training packages as electives, most students undertaking training prefer to
undertake the units which have an equine focus. Racing Victoria is considering making
Deloitte Access Economics
95
2012 ITAB Market Effectiveness Report
some of the business unit compulsory (some of which will need content review), although it
is recognised that this is a longer term solution. In the shorter term, some additional
business units are likely to be required to be undertaken for new entrants before a person
can be registered or licensed with Racing Victoria. In both the short and long term, the fact
that these units will become a requirement in order to work in the industry means that the
demand for these units will increase until the current stock of workers has undertaken the
training.
An ageing workforce and lack of new entrants continues to be a point of focus for the
industry. While there has been some success in attracting people to undertake both track
rider and stablehand training, more people are needed in order to fill shortages. Many
programs aimed at attracting people to the industry have continued over 2011. However
additional programs have also commenced which will continue in 2012. For example the
thoroughbred education program is focusing on secondary schools and careers counsellors
to try to attract a greater number of school leavers. Racing Victoria also subsidises
apprenticeships for both jockeys and farriers in order to attract people to these programs.
The availability of trainers to undertake the required training is also emerging as a problem
for this industry. Finding people suitable to train others at the required standard is
becoming difficult. Ideally trainers need pony club, racing and education skills or
experience in order to be able to deliver appropriate content to students, however most
people with the requisite equine experience have little interest in teaching. Racing Victoria
is advising and encouraging people to undertake the training and assessment qualification
in order to expand their skills and experience. With an ageing workforce in an industry
where a large proportion of the work is manual, it is hoped that more people will begin to
show an interest in the training and assessment course.
Industry outlook
The outlook for the Victorian racing industry depends to a large extent on the share of
household spending being devoted to entertainment and recreation, as well as the
popularity of racing relative to other entertainment and betting alternatives
To that end, there are a number of key positives for the racing industry over the medium to
long term. In particular, the ageing of the Australian population is leading to an increasing
number of retirees – a traditional base for gambling given their relatively large resources of
money and leisure time. Strong income growth and high levels of household wealth will
also help to underpin spending on gambling and recreational activities.
However, there are also a number of challenges for racing in Victoria. In particular, recent
years have seen increased competition from various other sports in the gambling market,
while the rise of online betting and betting using smart phone devices may also be reducing
demand from punters to attend race meetings. Those trends are turning money away from
racing, and risk generating an ongoing funding challenge for the industry.
The ongoing controversy surrounding jumps racing in Victoria is also an important challenge
in the short term. Recent incidents during jumps racing events threaten the future of the
sport and therefore another source of funding for the industry.
A further development for the industry in the short term will be the restructure of Victoria’s
gambling industry, which was first announced in 2008 and is due to commence in 2012.
Deloitte Access Economics
96
2012 ITAB Market Effectiveness Report
That restructure has resulted in Tabcorp Wagering being awarded the new 12-year
Wagering and Betting Licence which will take effect from August 2012. In 2009-10,
wagering turnover in Victoria was almost $4.5 billion, with some $322 million of that
provided to the Victorian racing industry.
Chart 15.1: Employment outlook – Victorian racing industry
'000 persons
6
Forecast
Change on year earlier
60%
5
40%
4
20%
3
0%
2
-20%
1
-40%
0
-60%
Forecast
Victoria
Racing
1998
2002
2006
2010
2014
1998
2002
2006
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
Recent data from the Australian Bureau of Statistics (shown in the charts above) suggest a
considerable fall in employment in the Victorian racing industry in 2011. That trend is also
evident at the national level, but is more pronounced in the Victorian data. Employment
data from the ABS can be subject to volatility and inaccuracy (particularly in regards to
smaller industries such as racing), though there does appear that an unwinding of recent
employment gains to some degree has taken place in the industry.
Should the apparent fall in employment through 2011 be accurate, Deloitte Access
Economics would expect a rebound in jobs in 2012.
Occupations in demand and critical skill shortages
Response to 2011 critical skill shortages
Track riders were the only occupation identified in the 2011 report as experiencing a critical
skills shortage. Programs were developed to try to attract workers, which included a
thoroughbred education program targeted at secondary school students to try to capture
secondary school leavers, and sending talent scouts to pony clubs to identify people with an
interest in becoming a track rider. The Track Rider Talent Identification Camp also
continued in 2011, where three camps were delivered for 35 riders. Retention of those
completing the training was good, with 90% now employed in the racing industry. Effort
has also been made to retain current workers, including recognising track riders in the
Thoroughbred Employee Awards, and through memberships to relevant industry
organisations and bodies.
Deloitte Access Economics
97
2012 ITAB Market Effectiveness Report
Occupations in demand and critical skill shortages in 2012
There are three occupations listed as being in demand in the racing industry. Track riders
and stable hands were listed in the 2011 report, while track maintenance managers are a
new addition to the 2012 MER report.
Track maintenance managers are becoming increasingly difficult to find, particularly with
the required green skills (including artificial surfaces and water management). Competition
from other industries (primarily other sporting clubs such as golf) where wages are often
higher is resulting in a shortage of workers with these skills. Racing Victoria is currently
trying to ascertain from industry how many are required, and exactly what skill sets are
required, so that an appropriate response can be formulated in 2012.
Despite the effort that has been put into filling the shortage of track riders, this occupation
remains on the critical skill shortages list for 2012. A track rider is able to ride 6 horses
comfortably. However due to the shortage riders are currently riding in excess of 10 horses
a day, leading to a greater chance of accidents occurring.
The table below lists the occupations in demand and their ANZSCO classifications.
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Track Rider
Stablehand
Stablehand (841516)
Stablehand (841516)
Track maintenance managers
Greenkeeper (362311)
Occupations experiencing a critical skills shortage
Industry title
ANZSCO classification
Track Rider
Stablehand (841516)
The table below outlines qualifications which are required for occupations experiencing a
critical skills shortage.
Qualifications required for occupations experiencing critical skill shortages
Occupation (Industry title)
Qualification
Track Rider
Certificate III (Trackriding)
Deloitte Access Economics
98
2012 ITAB Market Effectiveness Report
16
Services
Coverage: Cookery, Hospitality, Holiday parks, Tourism, Hospitality and
events, Beauty Services, Floristry, Funeral, Hairdressing, Other Personal
Services, Retail and Wholesale.
Specific industry and business cycle drivers: Population growth, ageing
population, overseas tourist arrivals, $A, petrol prices, interest rates,
employment growth and consumer confidence.
Recent relative sectoral performance rating: Above average
Expected relative sectoral performance rating: Below average
Summary of ITAB advice and consultation
Market effectiveness
A number of examples of market effectiveness were provided by Service Skills Victoria (SSV)
in terms of both success and failure. The successes generally relate to the development or
take-up of training while the failures relate to thin markets and training quality.
One example of success is in relation to the development of a suite of qualifications in the
new training package. These include:

Vocational Graduate Certificate in Hairdressing

Diploma of Salon Management

Vocational Graduate Certificate in Retail Leadership

Vocational Graduate Certificate in Intensive Pulsed Light and Laser Reduction
Each of these relates to a part of the services industry that often experiences problems with
retention. These qualifications help to address that issue by providing a clearer pathway
for career progression. Each also addresses specific needs in the market. For example, the
Vocational Graduate Certificate in Intensive Pulsed Light and Laser Reduction previously did
not exist and training was generally provided by the vendor.
The Retail Excellence in Victoria project provides an example of a successful collaboration
between the industry and training sectors. The program funds a position to work with both
employers and training providers to help meet industry’s needs. It also includes a
mentoring program for people involved in training, to help improve outcomes and
completion rates. This has seen increased enrolments in existing qualifications, such as the
Certificate IV in Retail and the Diploma in Retail Management.
On the other hand, qualifications in the Retail sector are experiencing difficulties due to
adverse incentives created by the Federal Government’s traineeship incentive. The
Diploma of Business (Management) is considered a traineeship under this system, whereas
the Diploma of Retail Management is not. Even though the latter is better tailored to the
Deloitte Access Economics
99
2012 ITAB Market Effectiveness Report
retail sector, employers are enrolling their staff in the former in order to take advantage of
the government’s incentive.
The view of SSV is that the recent change to a demand driven system, resulting in an
increase of funding to private providers, has exacerbated existing issues in the delivery of
training. The main issue of quality training delivery and outcomes is long term and
systemic, and SSV has been drawing this to the government’s attention for several years.
The success of educating and training of the Victorian workforce cannot be measured solely
through an increase in enrolments.
For example, the hairdressing industry has reported that training is not of a high enough
standard to produce job ready graduates. While enrolments have increased, quality
outcomes have not, and have therefore produced even more graduates that are not
employable. Indeed, Certificate II graduates in hairdressing do not have sufficient skills to
operate effectively in the market place. Employers prefer to recruit straight into the
Certificate III qualification and complement the training with in-house training programs to
address the deficiencies of training delivery. Employers in this sector are requesting that
the Certificate II become a traineeship and the preferred pre-apprenticeship model to
address the current shortcomings of the qualification. This change would provide the
student with the ability to develop their skills and gain experience within the workplace
which will increase employment on completion of their studies.
Another area of concern is the delivery of RPL. SSV believes RTOs are over-delivering RPL
at the expense of delivering training. One method of addressing these issues is by
increasing the auditing of training providers to ensure quality standards are being met in
training delivery and assessment. SSV is implementing a new accreditation program, The
Right Way, to assist RTOs in providing quality facilities, trainers and assessors. SSV believes
that this program will help to address the current quality issues that are being experienced
by industry. Another benefit of the program is the development of a database of quality
providers which will facilitate more successful outcomes for industry.
Related to this is a complaint by industry that institutionalised training does not lead to the
level of competence required in a commercial setting. Institutionalised training is generally
completed in a simulated commercial environment, focusing on technical skills. While this
produces technically competent graduates, employers complain they are not ‘job-ready’ as
they find it difficult to perform under a stressful commercial setting. SSV acknowledged
that complete training on the job does not produce the desired outcomes either. The
solution therefore may be to continue to provide a combination of both types of training,
with more reference to the workplace. This will also require greater collaboration of
industry, which would need to make places available for the requisite work placements.
One notable example of failure is an ongoing concern, and relates to the thin market for
training in skills for work in cemeteries and crematoria. According to the Crematoria
Trust, there are 150 individuals in Victoria requiring training in a Certificate III in Grave
Digging, but there is no RTO available to provide this training. Overall, this is an industry
with low staff turnover so there is not continual demand for the training. Furthermore,
delivery of the course requires expensive equipment. As such, it is not viable for RTOs to
run this course. In response, the industry is employing consultants from the mining
industry to deliver informal training.
Deloitte Access Economics
100
2012 ITAB Market Effectiveness Report
Change drivers and industry developments
SSV reported a number of change drivers for 2012 that were identified during consultations
with industry stakeholders. Most relate to demand side issues, with only a few supply side
issues present:

Unstable global economy and changing consumer spend (demand side)


Strong Australian dollar (demand side)
Social media and changing technology (demand side)



Increasing competition locally (demand side)
Lifestyle changes (demand side)
Ageing population (demand side)


Continued immigration (demand side)
Demand for tourism-related services (demand side)



Focus on sustainability (demand and supply side)
OH&S harmonisation (supply side)
Workforce development, recruitment and retention (supply side)
As a result of the fragile outlook for the global economy, businesses are restructuring their
workforces and consumers are decreasing their discretionary spend. There has been an
increasing number of business failures and remaining businesses are attempting to cut their
staff costs through more casual workforce and reduced investment in training. As such
there is reduced demand for training. The need for skill development still exists, but fewer
businesses have the capacity to invest.
A strong Australian dollar has an adverse effect on the local tourism sector, as travel to
Australia becomes relatively more expensive for the international market and travel abroad
becomes relatively cheaper for the Australian market. The industry has responded to this
challenge by increasing their focus on domestic marketing, with approaches such as the
Victorian Events Industry Strategy and the Victorian Tourism Workforce Development Plan.
If successful, this will require further training of the tourism workforce. At the moment, the
tourism sector relies on a casual and itinerant workforce, meaning the focus of training will
be on foundation skills provided by qualifications such as Certificates I and II in Hospitality
and Tourism.
Changing technology and the rise of social media mean that industry must be aware of
multi-channelling to target their customers. An example of the application of new
technology is the ability to read quick response barcodes using smart-phones, allowing
customers to scan a product’s code to obtain more information about that product. This
implies a need for skills in smart phone technologies and web management, and in areas
such as e-marketing and e-commerce. In areas such as hairdressing, tourism and
hospitality, businesses are starting to implement online booking systems. Qualifications
such as the Diploma of Salon Management, the Certificate IV in Hospitality and the Diploma
of Hospitality address these skill needs.
Local retailers are facing increasing competition from international retailers entering the
local market, both as shopfronts (such as Zara and Topshop) and through their presence in
online retailing. In response, domestic retailers are improving their customer experience in
terms of store interiors and customer service. This requires skills development and training
in higher order customer service skills, such as those provided in Certificates III and IV in
Retail. In order to better compete with international online retail, Australian businesses are
incorporating online shopping in their business model, as a complement to their shopfront
Deloitte Access Economics
101
2012 ITAB Market Effectiveness Report
retail. This requires development of high level management skills, as provided in
qualifications such as the Diploma of Retail Management.
Lifestyle changes and an ageing population were change drivers in 2011 and are expected
to continue to be an influence in an environment increasingly focused on wellbeing. This is
driving demand for training within the spa and beauty sector. New occupational roles
include wellness coaches, aroma therapists, mediation therapists, positive psychologists
and dermal therapists. It is expected this will lead to increased demand for training in the
Diploma of Beauty Therapy, the Diploma of Salon Management and the Vocational
Graduate Certificate in Intense Pulsed Light and Laser Hair Reduction.
The ageing population is leading to increased demand basic for health support services that
can be offered in pharmacies, and growth in the requirement for crypts and mausoleums.
The former requires the up-skilling of community pharmacy staff and the health electives in
the community pharmacy training package have been revised accordingly (indeed, the
pharmaceutical industry is increasingly providing a number of medical services such as
blood pressure and blood glucose monitoring and wound management services). The latter
requires more people trained with the skills required to construct crypts and mausoleums.
Continued immigration and a multicultural society mean that the services industry must
be more aware of, and better able to accommodate, cultural sensitivities. This may result
in niche providers who are able to adopt their practices to cater to different cultural needs,
with an ensuing need to include training on how to respond to different cultural beliefs in
relevant qualifications. This is a broad issue relevant to a wide range of sectors within the
services industry.
For example, the change driver is relevant in the tourism sector. Indeed, Tourism Victoria is
undertaking a series of related policy initiatives aimed at skills and training in the industry.
For example, a new China Strategy will be launched in early 2012 aimed at marketing
Victoria to a targeted Chinese audience and building industry readiness for an increase in
visitor numbers.
The understanding of the Chinese market within the industry is less developed than for
other markets. The China Strategy will help to build the knowledge within the Victorian
tourism industry and will include strategies to increase cultural awareness and other
industry needs. Tourism Victoria aims to help develop both skilled and unskilled labour
which is tailored to the Chinese market.
In spite of some conflicting trends in recent times (a strong Australian dollar and reduced
discretionary spending), the demand for tourism-related services has remained solid.
Melbourne successfully maintains a year-round calendar of events to attract tourists to the
city, with events such as the Australian Open tennis tournament and Grand Prix in warmer
months and significant exhibitions in cooler months. This puts pressure on the restaurant
and hotel sectors. Hotels have had difficulties employing managers for some time, as it is
difficult to up-skill staff in their own sector. Similarly, higher end restaurants are having
difficulty employing wait staff with a high skill level, commenting that it is even harder to
find good wait staff than it is to find chefs. The high Australian dollar is also encouraging
more Victorians to holiday overseas, underpinning demand for international travel
consultants.
A focus on sustainability in the media and by consumers has two major implications for the
services industry: to incorporate sustainable and more efficient practices into their business
model and to communicate these practices to their customers. This implies a need to upskill staff in sustainable business practices and ‘green’ methods. Units on sustainability are
Deloitte Access Economics
102
2012 ITAB Market Effectiveness Report
now embedded in all qualifications, meaning these skills will be delivered to those
undertaking full qualifications.
A final important change driver for 2012 is the harmonisation of OH&S regulation.
According to SSV, this will require employers to implement systems and processes in order
to adhere to a stricter regulatory environment, leading to demand for higher level
management skills. It will also require training in foundation skills such as literacy and
numeracy for some junior staff so that changes can be properly communicated. SSV states
that structured, targeted industry training will be required across all levels of staff to ensure
business keeps pace with an evolving regulatory environment.
More generally, there remains an issue of attracting and retaining skilled labour, leading to
ongoing workforce development issues. Negative perceptions of career prospects within
many sectors of the broader services industry remain, and industry continues actively
promote career pathways and qualifications in an effort to overcome these views.
Industry outlook
The services industry represents a wide range of sub-industries5, and has recorded a
relatively steady share of Victorian employment over the past two decades.
The retail sector is a key component of the Victorian services industry. Despite some
upheaval in the wake of the global financial crisis, Victorian retail has performed more
strongly than the national average. That said, recent retail growth in Victoria has been
centred in a few key sectors – food retailing, cafes and restaurants, and other retailing.
Although population growth is expected to weaken further, solid employment and wage
gains should provide a good base for income growth going forward. In turn, retail spending
is expected to recover to solid rates of growth in the medium term.
Further ahead, the structure of the retail environment is likely to change significantly over
the next decade, with the arrival of new players and changes in the focus of existing
retailers both likely.
Additionally, the Australian market has already demonstrated potential for overseas
supermarkets to provide greater competition in the domestic market, and the impact of
online (and direct import) shopping is expected to carve out an increasing share of overall
retail spending. That increase in competition and expansion of services may not be
supportive of overall retail employment.
Meanwhile, the Victorian tourism market looks set to record over one million international
visitors in 2011 for the third year running. That said, the broad outlook for tourism is
weighed down by the strength of the $A at present.
Despite a brief decline amidst global economic turmoil, the $A is once again firmly above
parity with the $US. The currency is likely to remain elevated over the medium term, but is
expected to eventually retreat to longer term trend levels. In the short term that is hurting
the industry by discouraging international visitors from coming to Australia, but also by
encouraging Australians to holiday overseas rather than domestically.
5
For the purpose of employment forecasts, the services industry is defined to comprise a range of ANZSIC
categories, the largest of which are accommodation and food services, and supermarket and grocery stores.
Tourism activity, which is included in this ITAB, does not have its own ANZSIC category. However, most tourism
trade is captured through ANZSIC categories such as accommodation and travel agency services.
Deloitte Access Economics
103
2012 ITAB Market Effectiveness Report
Employment outlook – Victorian services industry
'000 persons
700
Forecast
Change on year earlier
10%
Forecast
8%
600
6%
500
4%
400
2%
300
0%
200
-2%
100
0
-4%
Victoria
-6%
Services
-8%
1998
2002
2006
2010
2014
1998
2002
2006
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
Looking to broader measures of tourism, room nights occupied have been stronger in
Victoria than the national average, and this trend is expected to continue over the medium
term. Melbourne’s role as a business centre and the unofficial cultural capital of Australia
may be helping to support tourism flows, while regular events such as the Melbourne Cup,
Australian Open tennis and golf tournaments, and the Grand Prix provide an important
demand base.
Taking a longer view, it remains the case that the growing middle class in developing
economies represent a key market for the tourism sector for the future. Victoria should be
well positioned to take advantage of this trend, and may also be able to record a recovery
in higher education services for international students, which would also support broader
activity across the services industry.
In the short term, however, the high $A and a weak retail environment may cause a further
modest fall in employment in the industry in 2012, before a return to growth in 2013.
Occupations in demand and critical skill shortages
Response to 2011 critical skill shortages
There were three occupations listed as experiencing critical shortages in 2011: chefs, retail
store managers and restaurant managers.
Industry response to the ongoing shortage of chefs has been to recruit international chefs.
This has been an ongoing problem for some time, and industry is requesting a
reinstatement of chefs on relevant occupation lists at the Federal level. SSV has informed
the State Government of this shortage.
SSV has actively promoted a retail management program to industry, which combines a
Certificate IV and Diploma of Retail Management with a mentor program, in an attempt to
alleviate the shortage of retail store managers. The retail industry is increasingly aware
that further training is needed, and the uptake of training is slowly increasing. Some
retailers have commenced participation in the mentoring program.
The shortage in restaurant managers continues to be dealt with by industry filling the
positions with unqualified staff. SSV believes the solution is to customise the Retail
Deloitte Access Economics
104
2012 ITAB Market Effectiveness Report
Excellence in Victoria project (noted in the discussion of examples of market success above)
for the hospitality sector. However additional resources would be required to undertake
this project.
Occupations in demand and critical skill shortages in 2012
The table below summarises those occupations cited as being in demand and those
experiencing critical skill shortages in 2012, based on advice provided by SSV. These
occupation lists were determined by SSV following formal engagement with industry.
Overall, there is an increase in the number of occupations listed as in demand and as critical
skill shortages compared to 2011.
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Hairdresser
Beauty therapist
Hairdresser (391111)
Beauty therapist (451111)
Pharmacy assistant
Pharmacy sales assistant (621411)
Dispensary assistant
Pharmacy technician (311215)
Florist
Florist (362111)
Spa therapist
Beauty therapist (451111)
Cook
Cook (351411)
Housekeeper
Commercial Housekeeper (811411)
International travel consultant
Travel consultant (451612)
Retail manager
Retail manager (General) (142111)
Supervisory staff – Retail
Retail supervisor (621511)
Chef
Chef (351311)
Hotel manager
Hotel or Motel Manager (141311)
Restaurant manager
Cafe or Restaurant Manager (141111)
Wait staff
Waiter (431511)
Occupations experiencing a critical skills shortage
Industry title
ANZSCO classification
Retail manager
Retail manager (General) (142111)
Supervisory staff – Retail
Retail supervisor (621511)
Chef
Chef (351311)
Hotel manager
Hotel or Motel Manager (141311)
Restaurant managers
Cafe or Restaurant Manager (141111)
Wait staff
Waiter (431511)
The table below outlines qualifications which are required for occupations experiencing a
critical skills shortage.
Deloitte Access Economics
105
2012 ITAB Market Effectiveness Report
Qualifications required for occupations experiencing critical skill shortages
Occupation (Industry title)
Qualification
Retail managers
Diploma of Retail Management
Vocational Graduate Certificate in Retail
Supervisory staff – retail
Certificate IV in Retail Management
Chefs
Certificate IV, Diploma and Advanced Diploma of Hospitality
Hotel managers
Diploma of Hospitality
Restaurant managers
Diploma of Hospitality
Wait staff
Certificate III in Hospitality
Deloitte Access Economics
106
2012 ITAB Market Effectiveness Report
17 Textiles, Clothing, Footwear
and Leather
Coverage: Clothing, Footwear, Leather, Shared – TCF&L, Textiles.
Specific industry and business cycle drivers: Lowered tariff protection, import
competition, $A, new trade agreements, interest rates, employment growth,
wage growth, tax cuts.
Recent relative sectoral performance rating: Average
Expected relative sectoral performance rating: Low
Summary of ITAB advice and consultation
Market effectiveness
Various examples of training market effectiveness were reported by the Council of Textile &
Fashion Industries of Australia (TFIA) and the Textile Clothing & Footwear Union of Australia
(TCFUA).
Examples of training market success include the Stimulate Training Demand Project which
was funded by the Higher Education and Skillls Group (formally Skills Victoria) over 2010
and 2011. This program enrolled approximately 40 participants in Certificate II and
Certificate III qualifications in Textile Production and Clothing Production. The program
targeted existing non-qualified workers who were able to gain a qualification with a
combination of RPL and gap training. The program was also successful in marketing
traineeships to a number of businesses which resulted in 22 commencements.
A number of other programs funded by the Higher Education and Skillls Group were cited
as examples of training market success. These were principally run through the
International Fibre Centre in collaboration with a training provider. The International Fibre
Centre is based in Geelong and is the only organisation in Australia providing funding for
skills development specifically for the textiles and fibre industry. It funds training
opportunities related to three programs – innovative industry program, sustainable
industry program and the value chain program. The programs focused on a wide range of
skills, including those related to sustainability, lean manufacturing and competitive
practices, along with industry-specific equipment and process training.
A third example of training market success offered by TFIA and TCFUA is the
implementation of a workplace language and literacy program. This program was
conducted by TCFUA to increase the foundation skills of the workforce. TFIA and TCFUA
note feedback from employers and participants acknowledging the benefits of these classes
in improving communication and team skills in the work environment.
Deloitte Access Economics
107
2012 ITAB Market Effectiveness Report
Market failures identified by TFIA and TCFUA included the lack of availability of the
Certificate III in Engineering – TCF Mechanic. At present, although one training provider
lists this qualification on its scope, there are no enrolments in Victoria. There is strong
industry demand for the skills provided by this qualification and a related occupation,
textile, clothing and footwear (TCF) mechanic, has been listed as in critical shortage for a
number of years.
According to TFIA and TCFUA, there has been a clear shift by training providers to offer a
broader engineering qualification rather than this specialist course. This trend does not
align with increasing demand from industry for the specific skill sets associated with
operating sophisticated TCF manufacturing machinery. Apprentices undertaking the
broader engineering qualification have also expressed concern regarding the mismatch
between the skills provided by the course and those needed in the workplace.
The Certificate III in Engineering – TCF Mechanic is critical to the TCF industry, and not
having individuals with the skills to run and maintain machinery can have the potential to
close a business. However, TFIA and TCFUA recognise that encouraging people to enrol is
difficult, in part because of a lack of availability of the qualification. This, in turn, reduces
the incentive for training providers to offer the more specific TCF qualification because
viable apprentice enrolments cannot be established.
The second market failure identified by TFIA and TCFUA relates to the role of RPL in the
training market. The TCF industry is characterised by a skilled workforce that lacks formal
qualifications. As such, from an employee perspective there is clearly a role for RPL to
formally build and recognise skills. However, some instances of poorly monitored RPL
processes and over credentialing has undermined industry confidence in RPL.
As with some other industries, there is also a view within the TCF industry that the
equipment and facilities used by training providers are not adequately keeping pace with
changes in technology. As a result, a number of companies send their workers overseas to
learn how to operate and maintain machinery and equipment, while training within
Australia is often undertaken by the equipment manufacturer. There are, however, some
exceptions, most notably the TCF training centre at Kangan Institute known as The Hub.
Change drivers and industry developments
Advice from TFIA and TCFUA is that the following major change drivers are expected to
affect the industry in 2012:

Government policies and compliance (demand side)

Globalisation and competition (supply side and demand side)

Sustainable work practices (supply side)

Technological changes (supply side)

Ageing workforce (supply side)

Skill shortages and gaps (supply side)
These same change drivers were also relevant in 2011, suggesting a consistent set of
challenges and opportunities are facing the industry.
The industry continues to benefit from a broad range of government contracts.
Increasingly, those contracts require compliance with regulations, including around labour
Deloitte Access Economics
108
2012 ITAB Market Effectiveness Report
market conditions and employment standards. Moreover, there is also a growing
recognition of the need to incorporate ethical and sustainable production processes, and
the number of business seeking accreditation with Ethical Clothing Australia is increasing.
Ethical Clothing Australia requires firms to trace through their supply chain to confirm that
all levels of workers (including subcontractors and outworkers) are receiving adequate pay
and all required entitlements.
The training needs resulting from this change driver relate to employees’ understanding of
regulations and ethical business practices, and units of competency covering these topics
are already present in existing qualifications. However a significant proportion of workers
in the TCF manufacturing workforce do not possess formal qualifications and these skills
may be best provided through targeted short course training programs.
Globalisation and international competition are ongoing challenges for the industry. The
2010 reduction in import tariffs on TCF products (from 17.5% to 10% on clothing and from
10% to 5% on textiles and footwear), combined with the elevated $A, is continuing to
squeeze profit margins in the industry and erode competitiveness.
These economic conditions have implications for skills and training. Low profitability in the
industry tends to discourage employers from actively participating in the training market,,
including taking on an apprentice or providing formal training for employees.
Conversely, however, it also increases the need for employees to possess a broad range of
skills. For example, as the industry moves to become more efficient, knowledge of lead
manufacturing and other business production techniques will be increasingly valuable.
Units of competency covering these skills are already provided as part of the Certificate IV,
Diploma and Advanced Diploma of Competitive Manufacturing and the Certificate III in
Clothing Production.
The rise of online retailing is also relevant for the TCF manufacturing industry. Online
retailing requires a different manufacturing model, with an emphasis on speed to market
and a concentration on producing individual items rather than lines by colour and size.
These changes all require skills in business planning and the flexibility to meet changing
customer needs.
The importance of sustainability and green production techniques is growing within the
industry. The workforce requires the skills to implement and encourage sustainable
practices and the understanding of how a focus on sustainability can influence a company’s
bottom line. In some sectors, sustainability is a requirement to meet customer
requirements. For example, carpet manufacturers’ products which are certified under the
Environment Certification Scheme can contribute to a building’s green star rating.
TFIA and TCFUA report a reasonable take up of qualifications such as the Diploma of
Sustainability, which can be contextualised to meet the needs of specific enterprises within
the industry.
Technological changes in manufacturing and production techniques are tending to favour
large businesses with the resources to invest in new equipment and machinery. Examples
include the growing use of computer aided design, digital textile printers and seamless
knitwear machines. While the use of this technology can reduce demand for labour within
the industry, the workforce which is utilised requires a strong understanding of the
technology and training in the use of a wide range of equipment.
Deloitte Access Economics
109
2012 ITAB Market Effectiveness Report
As with a number of other industries, TCF is challenged by an ageing workforce. TFIA and
TCFUA report anecdotal evidence that over 72% of the industry workforce is aged over 35,
with the loss to industry as these workers retire expected to be particularly crucial in the
area of tailoring and other specialised sewing techniques used in niche clothing production.
The use of these experienced workers as mentors for younger staff is important for the
retainment of skills in the industry. TFIA and TCFUA suggest that apprenticeships in
clothing production could be offered to individuals currently working in the industry
informally in an effort to rebuild the skill base.
Skill shortages and gaps in the industry remain a challenge. These shortages are most
apparent at the management level, with a large number of firms operating without a formal
business plan and management staff lacking an understanding about business basics.
These skill gaps extend to areas of regulatory compliance, triple-bottom-line accounting
and other management responsibilities, and could be reduced through greater uptake of
qualifications such as the Diploma and Advanced Diploma of Management.
Industry outlook
The manufacturing industry in Victoria has declined as a share of the economy over the
past two decades. Although there has been varied growth within the sub-industries of
manufacturing during that period, the textile, clothing and footwear industry has been
particularly vulnerable, and the level of employment has been falling back as a result.
The decline of the textiles, clothing and footwear industry over the longer term reflects
structural factors. One of the most important drivers has been the intense competition
that local producers face from low-cost imported products from overseas, particularly in
Asia. While the broader manufacturing industry also faces challenges from global
competition, the challenges are more acute for textiles, clothing and footwear due to its
labour intensive nature, with low-wage countries such as China having a significant
competitive advantage. Moreover, as protectionist measures such as tariffs have declined,
domestic producers have become increasingly exposed to competition from abroad.
Consumer trends are also posing a challenge for the industry, with Australian consumers
choosing to spend more of their growing incomes on goods and services that are not
clothing and footwear. Despite overall spending on clothing and footwear growing over
time, clothing and footwear has been making up a declining share of total consumer
spending.
Recently the textiles, clothing and footwear industry has also been battling cyclical factors,
particularly higher interest rates and the historically high level of the $A. Moreover, at the
retail end, Australian clothing retailers and department stores have experienced weak sales
over the past year in an environment of consumer caution. The strength of Australia’s
mining sector suggests that the challenges posed by the high $A may be ongoing for some
time.
The high $A has also increased the visibility of online retail sales. While the volume of
clothing and footwear purchased online by Australian consumers from overseas websites is
likely to be relatively low at present, the share of online spending in overall retail sales
appears to be growing rapidly, and this may represent another adverse trend for domestic
textile, clothing, and footwear producers over the longer term.
Deloitte Access Economics
110
2012 ITAB Market Effectiveness Report
Chart 17.1: Employment outlook – Victorian textile, clothing and footwear industry
'000 persons
50
45
40
35
30
25
20
15
10
5
0
1998
Forecast
Change on year earlier
25%
Victoria
20%
15%
Forecast
Textile, clothing and
footwear
10%
5%
0%
-5%
-10%
-15%
-20%
2002
2006
2010
2014
1998
2002
2006
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
In light of the structural challenges facing Victoria’s manufacturing industry, the Victorian
Government asked the Victorian Competition and Efficiency Commission (VCEC) to
complete an inquiry into Victoria’s manufacturing industry. The VCEC’s draft report
recommended against the introduction of new protectionist measures for the
manufacturing industry, and recommended that existing measures that continue to exist
such as local content provisions in procurement policies be removed. While the Victorian
Government is yet to respond to the VCEC’s recommendations, the current low levels of
protection and assistance for the textile, clothing, and footwear industry are likely to
remain in place.
The Federal Government’s carbon tax will be introduced in 2012 and may pose challenges
for domestic textile, clothing, and footwear producers. Textile, clothing and footwear
production is not an emissions intensive activity and therefore will not benefit from large
levels of assistance. Domestic textile, clothing, and footwear producers are expected to see
a rise in costs such as electricity, however, which will further erode competitiveness.
There will be better news for the sector from improved income growth in Australia over
time. While retail is currently in a slump, Deloitte Access Economics expects a recovery to
take hold over time as income growth translates into a higher rate of retail spending, which
should lift sales for all suppliers.
Over the longer term the enormity of the challenges facing the industry means that output
and employment are likely to continue trending down over time.
Occupations in demand and critical skill shortages
Response to 2011 critical skill shortages
TFIA and TCFUA report that a number of responses to critical skill shortages identified for
2011 have taken place. Four occupations were listed as in critical shortage in 2011: textile,
clothing and footwear mechanic; apparel patternmaker / grader; dressmaker / tailor; and
general footwear tradesperson.
The view of TFIA and TCFUA is that the shortage of textile, clothing and footwear
mechanics is compounded by the lack of availability of the Certificate III in Engineering –
Deloitte Access Economics
111
2012 ITAB Market Effectiveness Report
TCF Mechanic. As such, much of the work done through 2011 to try to alleviate this
shortage has been directed at promoting this qualification within industry and to training
organisations. As noted above in the discussion of market failures, at present only one
training provider lists this course on their scope of qualifications.
TFIA and TCFUA have encouraged training providers, particularly TAFEs, to offer this course
rather than a more general engineering apprenticeship, and have encouraged industry to
write to training providers and the Victorian Government. TFIA and TCFUA believe that
take up of this course would go some way to addressing the current skill shortage.
According to TFIA and TCFUA, it takes approximately five years experience in order to
acquire the skills to be a quality apparel patternmaker. This long lead time is exacerbating
the skill shortage in this occupation, and industry continue to report that they are eager to
take on adequately trained patternmakers but find it difficult to source skilled labour. The
occupation is fundamental in the industry because of the technical knowledge of garment
construction that is provided by patternmakers.
TFIA and TCFUA are working with training providers to provide specialist programs in
patternmaking for existing workers. These programs are being pitched at the diploma level,
and are designed to enhance the skills of qualified but inexperienced workers already
operating within the industry.
The current shortage of dressmakers and tailors is most prevalent in regional areas. There
is a strong industry presence in regional areas of Victoria, and experienced workers have
been difficult to source. TFIA and TCFUA noted that in an effort to meet labour
requirements, some large companies are choosing to take on people who have gained
experience as hobby sewers and are providing non-accredited training to them on site.
In an effort to lift the volume of skilled workers and ensure consistent training and skills
across the industry, TFIA and TCFUA have been promoting the Certificate III in Clothing
Production as a qualification that would help to alleviate the skill shortage. However
budget constraints and the challenges of production targets and a weak retail market have
discouraged industry from taking on apprentices.
The need for general footwear tradespersons is growing, and TFIA and TCFUA expect
demand to lift further over time. There has been some uptake of training related to this
occupation, especially in relation to medical grade footwear. Some of that increase may be
attributed to the response of the industry training body, which consulted directly with
footwear specialists in an effort to increase the number of training instructors and build
relationships between industry and training providers.
Occupations in demand and critical skill shortages in 2012
The tables below summarises the occupations in demand and experiencing critical skill
shortages in 2012. These occupation lists have been advised by TFIA and TCFUA, and have
been determined following formal engagement with industry.
Consistent with the common themes and issues expected to affect the industry in 2012, the
occupations listed below are the same as those which were nominated for 2011.
Deloitte Access Economics
112
2012 ITAB Market Effectiveness Report
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Skilled apparel machinists
Sewing machinist (711611)
Leather goods makers
Leather goods maker (393112)
Textile, clothing and footwear mechanic (323215)
Textile clothing and footwear mechanic
Apparel cutters
Apparel patternmakers / Graders
Apparel cutter (393211)
Clothing patternmaker (393212)
Dressmakers / Tailors
Dressmaker or tailor (393213)
Canvas goods maker
General footwear tradesperson
Canvas goods fabricator (393111)
Footwear factory worker (839915)
Occupations experiencing a critical skills shortage
Industry title
ANZSCO classification
Textile clothing and footwear mechanic
Textile, clothing and footwear mechanic (323215)
Apparel patternmakers / Graders
Clothing patternmaker (393212)
Dressmakers / Tailors
Dressmaker or tailor (393213)
Shoemaker (393114)
General footwear tradesperson
The table below outlines qualifications which are required for occupations experiencing a
critical skills shortage.
Qualifications required for occupations experiencing critical skill shortages
Occupation (Industry title)
Qualification
Textile Clothing and Footwear Mechanic
Apparel Patternmakers / Graders
Certificate III in Engineering – TCF Mechanic *
Diploma of Applied Fashion Design and Technology **
Dressmakers / Tailors
Certificate IV in Clothing Production †
General Footwear tradesperson
Certificate III in Footwear Production *
* Training can be undertaken through 3 year apprenticeship.
** Training can be undertaken through 4 year apprenticeship. On the job training is very beneficial.
† Training can be undertaken through 4 year apprenticeship. On the job training with a tailor is preferable.
Deloitte Access Economics
113
2012 ITAB Market Effectiveness Report
18
Transport and Storage
Coverage: Road, rail, aviation and marine (transport), and storage and
distribution.
Specific industry and business cycle drivers: Trade (particularly retail, mining,
agriculture, manufacturing), fuel prices, population growth, infrastructure
policy/provision.
Recent relative sectoral performance rating: Average
Expected relative sectoral performance rating: Above average
Summary of ITAB advice and consultation
Market effectiveness
The Transport and Distribution Industry Training Board (TDT) report a number of cases of
market success and failure. The examples of success demonstrate TDT working with public
and private RTOs to create opportunities for new entrants to the transport and logistics
sector, as well as new opportunities for existing workers to up-skill in areas of skill shortage.
The examples of failure link back to the geographic spread, the volume of small enterprises
and the license accumulation (rather than skill accumulation) that characterise the industry.
A recent success has been the Logistics Cadetship Program, involving collaboration
between Kangan TAFE, Goulburn Ovens TAFE and industry, and aimed at recruiting high
school graduates into the industry. The cadetship program involves employment in the
sector (typically in non-road transport businesses) coupled with a Certificate IV in Logistics
in the first year and the Diploma of Logistics in the second year.
The program is attracting around 15 cadets per year, with 65-70 cadets having been
through the program over the last 3 years, and boasting a 90% completion rate and 70%
rate of retention in the industry. The success of the model has led to emulation by other
Australian transport associations. The continued growth of the program is limited by the
volume of transport businesses willing to take on cadets.
TDT, working with TAFE and private RTOs, continues to identify and undertake projects
involving the development of new training for the industry. The focus is presently at the
Certificate III level, and in road transport and warehousing. Implications of technological
development for transport operations are at the core of this new training, and will be
translated into new courses up to Diploma level in the near term.
In conjunction with training providers and RPL experts, TDT has been testing the viability of
delivering the Diploma of Logistics to existing workers in thin regional markets. For
instance, TDT has identified 12 individuals ready to enrol in the course. However delivery
of the training is not feasible at present due to the sparse distribution of these individuals
across the state. TDT is proposing an RTO consortium to overcome these geographical
barriers.
Finally, TDT and Bus Vic are progressing the concept of a customised Diploma of Logistics
to better suit the bus sector, to the point where there is now a national agreement
Deloitte Access Economics
114
2012 ITAB Market Effectiveness Report
between industry and the Transport & Logistics Industry Skills Council to develop an all new
Diploma specific to the sector. The qualification will include planning, human resources and
finance competencies, as well as understanding of how to operate under regulatory
frameworks. It is hoped that at the same time as up-skilling existing workers it will also
attract new younger entrants to the industry.
In terms of market failures, the central point remains the disconnect between training and
experience. This mismatch between what the training system is delivering – in particular
cases – and the minimum competency the industry requires is translating into a stockpiling
of qualified yet unemployable labour. This trend remains acute in the road transport and to
a lesser extent maritime sector, where work-based training faces significant barriers (for
instance insurance or available vessels). The solution is said to be a combination of a
change in the way training is delivered, and a change in industry employment practises (for
instance greater proportion of casual labour, job-sharing and increased attraction of female
participants).
The other key challenge for TDT remains how to deliver training into small regional
transport businesses, in a region where only one person may require training. Attracting
and retaining qualified and experienced trainers also presents an ongoing challenge for
both public and private RTOs, particularly in growth areas of advanced road, rail and
warehousing training.
Change drivers and industry developments
TDT reported several change drivers for 2012 that were identified during consultations with
industry stakeholders. They cover both demand and supply side issues, and include:

Growing freight task and resulting need to further optimise operations (demand side)

Regulatory developments – Carbon Tax and national regulatory bodies (demand side)

Fluctuations in the price of fuel (demand side)

Workforce development planning in rail (demand and supply side)

Technology developments in road transportation (demand and supply side)
As Victorian production and population grows, the freight task faces a corresponding
increase. However, this growth is inhibited by a shortage of skilled labour in key areas. For
instance in distribution centres, where operations are already lean and there is little
opportunity to further substitute capital for labour at this point. As such there is a need to
increase labour productivity, and optimise operations in light of emerging economic,
demographic and regulatory trends. The obvious implication is the need for up-skilling at
mainstay operator level, across all transport and logistics industry sectors.
The recent Inquiry into Skills Shortages in the Rail Industry in Victoria has assessed the
skills base and seen the creation of new workforce development plans for various
occupations. In light of the increased development and maintenance of rail infrastructure
in Victoria, coupled with increased regulation and more complex contractual arrangements,
the Inquiry identified a need for new skills and competencies. Delivery of the Certificates
II/III/IV in Rail Infrastructure and Rail Operations, as part of the new TLI10 Version 2 training
package, will go at least part-way to addressing these emerging shortages.
B-triples present an opportunity to dramatically increase the productivity of road transport,
reducing the labour to capital ratio, and as such have been trialled for 3 years on limited
routes in Victoria. Technology in these vehicles – in terms of accident avoidance and fuel
efficiency – suggests welfare gains are to be had where they are replacing conventional 22-
Deloitte Access Economics
115
2012 ITAB Market Effectiveness Report
wheel configurations. If the trial is successful, it will simultaneously reduce the skill
shortage in terms of reducing the number of drivers required, while also increasing the
shortage to the extent that existing drivers need to be up-skilled in driving operations to
better suit these vehicles.
The road transport sector has an exemption from the Carbon Tax until July 2014, which
has, in some parts of the industry, prompted a ‘wait and see’ approach to adjusting
operations. In others parts, however, it is creating a level of demand for new operational
and compliance management training. While the demand is building only slowly at this
point, and will inevitably need to be structured around recording, reporting and payment
details as they apply to the sector, it is anticipated that the competencies would be
provided at the Diploma level. The tax will commence on July 2012 for the rail sector,
although is anticipated to have little effect on operations.
The other major regulatory development set to impact the road, rail and maritime sectors
in Victoria is the creation of three national regulatory bodies to cover each of these
respective sectors from January 2013. As a major undertaking in the harmonisation of
regulation across the states and territories, it is expected this development will reduce
reporting burden (duplication) for national operators. The implication for training is a
potential realignment of reporting and recording arrangements, as taught at the Certificate
III to Diploma levels.
Growing fluctuations in fuel pricing is leading to additional pressure on road transport
businesses to manage this expense and remain viable (particularly where using fixed price
contracts). For instance, the industry benchmark is that every 1 cent rise in the price of fuel
adds $1,000 to the annual fuel bill of a typical heavy vehicle. This signals a need for higher
order skills to off-set the impact on operations. Currently no such risk management or
contingency training is available. Indeed technical training in operational and financial
planning, contract negotiation and risk management (at and above the Diploma of Logistics
level) is required in response.
Industry outlook
The transport and storage industry remains highly cyclical, tending to exaggerate economic
activity in the wider economy. The industry has remained a relatively steady share of the
Victorian economy over the past two decades.
The outlook for the goods transport sector is partly driven by projected growth in retail
trade. Although retail trade has underperformed recently, there are signs of recovery led
by solid employment and wage growth, and the prospect of lower interest rates over the
coming year. Moreover, the rise in online shopping has also helped to underpin solid
growth in freight.
The outlook for passenger transport and transportation services is less positive, with the
sector facing a number of challenges at present. They are led by issues across the broader
tourism industry, including the elevated exchange rate which is dampening demand from
international visitors and encouraging Australians to holiday overseas.
In the longer term, the likely persistence of high fuel prices will continue to hurt the sector,
and, while fuel used by heavy vehicles is exempt from the carbon tax until 2014, it will have
an effect on costs in the sector going forward.
Other industry-specific issues are also relevant. The recent disruptions to travel services
caused by industrial disputes in the aviation sector have posed notable challenges for the
sector, though some certainty in the area has now been achieved.
Deloitte Access Economics
116
2012 ITAB Market Effectiveness Report
There are a large number of transport infrastructure projects underway in Victoria at
present, including at least fifteen current and planned works on freeways and highways
around the State. In addition, a number of arterial roads are set for upgrades, in part
funded by Federal economic stimulus spending.
Employment outlook – Victorian transport and storage industry
'000 persons
180
Forecast
Change on year earlier
15%
160
10%
140
120
Forecast
Victoria
Transport
2002
2006
5%
100
0%
80
60
-5%
40
-10%
20
0
-15%
1998
2002
2006
2010
2014
1998
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
Despite an array of negative influences, the transport industry recorded a solid recovery in
2011 following a fall in employment in 2010. Employment growth in the industry is
expected to remain steady over the medium term.
Occupations in demand and critical skill shortages
Response to 2011 critical skill shortages
The two transport and logistics occupations in critical skill shortage in Victoria in 2011 were
heavy combination and multi combination drivers as well as train drivers. While
qualification uptake in these areas has increased significantly since 2008, it is failing to
alleviate the skills shortage in any meaningful way, at least in road transport.
In terms of heavy combination and multi combination drivers, industry continues to report
driver shortages as an ongoing impediment to business growth. In response TDT has been
promoting the continued development and uptake of the qualifications, for instance the
Certificate IV in Driving Operations (under the new TLI10 Version 2) which is aimed at multicombination vehicles. Furthermore an accredited driver’s license trial is currently being
negotiated between relevant industry and regulatory bodies, by way of reducing the long
lead time to reaching the minimum standards.
For train drivers, TDT continues to collaborate with the Transport & Logistics Industry Skills
Council and Victorian industry on the development of driver qualifications, and continues to
assist interstate training providers to deliver these qualifications into Victoria (given the
lack of a Victorian provider). Industry continues with its twice yearly driver recruitment
program, and is having relative success with this, although driver shortages remain a
perennial issue. As a result, train drivers have been listed as experiencing a critical shortage
again in 2012. However, the view of TDT is that there are suitable and willing candidates,
and recruitment is not a significant problem. Rather, the issue appears to be a lack of
willingness to develop and fund the required labour force.
Deloitte Access Economics
117
2012 ITAB Market Effectiveness Report
Occupations in demand and critical skill shortages in 2012
The tables below summarise the occupations in demand and experiencing critical skill
shortages in 2012. These occupation lists have been advised by TDT and have been
determined following formal engagement with industry. The inclusion of the transport
manager and warehouse administrator occupations relate to the higher order management
skills requirements of the industry mentioned above. In 2011, TDT noted that stevedores
were in demand in the industry. In this report, crane and lift operators and forklift drivers
have been included instead to provide some additional specificity around the skills
required.
The inclusion of deck hands is driven by a critical need to support offshore oil and gas
activity in Victorian waters.
Overall, there is an increase in the number of occupations listed as in demand compared to
2011, and a greater proportion of these are also listed as experiencing a critical skill
shortage.
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Heavy rigid to multi-combination drivers
H
Truck driver (general) (733111)
Rail drivers
Train driver (731311)
Tanker driver (733114)
Tram driver (731312)
Environmental and compliance managers
Environmental manager (139912)
Logistics managers
Supply and distribution manager (133611)
Operations managers
Transport company manager (149413)
Transport company manager
Transport company manager (149413)
Warehouse administrator
Warehouse administrator (591116)
Bus drivers
Bus driver (731211)
Deck hand / general purpose hand
Deck hand (899211)
Crane, hoist or lift operator
Crane, hoist or lift operator (712111)
Forklift driver
Forklift driver (721311)
Occupations experiencing a critical skills shortage
Industry title
Deck
/ general
purpose hand
Heavyhand
rigid to
multi-combination
drivers
ANZSCO classification
Truck driver (general) (733111)
Tanker driver (733114)
Rail drivers
Train driver (731311)
Tram driver (731312)
Transport company manager
Transport company manager (149413)
Warehouse administrator
Warehouse administrator (591116)
Bus driver
Bus driver (731211)
Deck hand / general purpose hand
Deck hand (899211)
Crane, hoist or lift operator
Crane, hoist or lift operator (712111)
Forklift driver
Forklift driver (721311)
Deloitte Access Economics
118
2012 ITAB Market Effectiveness Report
The table below outlines qualifications which are required for occupations experiencing a
critical skills shortage.
Qualifications required for occupations experiencing critical skill shortages
Occupation (Industry title)
Qualification
Heavy rigid to multi-combination drivers
Certificate II in Driving Operations
Certificate III in Driving Operations
Rail drivers
Certificate IV – Transport and Logistics (Rail Operations)
Transport company manager
Diploma of Logistics
Warehouse administrator
Certificate IV in Warehousing Operations
Bus driver
Certificate III Transport & Logistics (Driving Operations)
Certificate IV Logistics
Deck hand / general purpose hand
Crane, hoist or lift operator
Certificate II/III in Transport & Distribution (Maritime Operations)
Certificate II in Stevedoring
Certificate III in Stevedoring (Crane Operations)
Certificate III in Stevedoring (Team Leading)
Certificate IV in Stevedoring Operations
Forklift driver
Deloitte Access Economics
Certificate III in Warehousing Operations
119
2012 ITAB Market Effectiveness Report
19
Water
Coverage: Operation of water and wastewater facilities such as dams,
pipelines, water treatment facilities, wastewater collection systems,
wastewater treatment plants.
Specific industry and business cycle drivers: Government regulation,
population growth, drought, climate change, housing cycle.
Recent relative sectoral performance rating: High
Expected relative sectoral performance rating: Above average
Summary of ITAB advice and consultation
Market effectiveness
The Victorian Water Industry Association advised that the training market has been
generally successful in delivering training to the water industry. Industry is now at the
operational level it should be (indeed Victoria is now leading in terms of the number of
people with operation qualifications), with many employees having now completed a
Certificate III qualification over the last five years.
Industry is now advising it would like to select some of these employees to undertake a
Certificate IV, indicating that the training has been valued by industry, and they see the
benefit in undertaking further training for their employees.
The process for gaining national endorsement for the Diploma and Advanced Diploma
courses in Engineering Technology (developed by City West Water) has been slower than
expected. However it is expected that the national endorsement will take place mid 2012.
This training package will mean that functions normally undertaken by engineers (with
tertiary qualifications) will now be able to be performed by graduates of the Diploma and
Advanced Diploma. This is expected to help reduce the shortage of Civil Engineers
somewhat.
Training provided by RTOs generally fulfils the broad industry needs. There is much more
flexibility in training provision so that industry can mix and match units to suit their needs.
This results in industry being more willing to undertake the training.
Thin market issues continue to be a problem in this industry, resulting in some training not
being undertaken. However, these problems are being at least partly addressed by the new
national training resources, as well as a new training provider coming on-stream (the
Cranbourne campus of Chisholm TAFE), which will be a national water training centre.
Deloitte Access Economics
120
2012 ITAB Market Effectiveness Report
Change drivers and industry developments
Four main change drivers have been identified for the Water industry. They are:

The desalination plant (demand side)

The introduction of intelligent water meters (demand side)

Change in climate conditions from dry to wet (supply and demand side)

The National Harmonisation regulations (supply side)
The change in climate conditions from dry to wet is an emerging change driver for this
industry, and also means there will be ongoing training in resulting green skills. Too much
water presents an entirely new set of problems for a sector which had faced the problem of
not enough water for many years. These include establishing emergency procedures if
there is flooding, protocols to determine when there needs to be releases from dams, as
well as safety concerns (for example if a dam is empty for a period of time there may be
structural damage to the dam when it fills). The emerging skills required are for operators
who work around dams with training in emergency procedures and operations of dams in
emergency situations (primarily engineers).
The Victorian Water Industry Association believes that current changes in the climate
would seem to indicate that this kind of extreme weather will continue into the future, and
the industry response from the dam working group is that the training is required. The
current training package outlines the skills required, but there probably needs to be some
further development of a training package suitable for these particular skills which will
continue to be in demand.
Other green skills in this industry continue to be developed – for example units around
catchment management (which relate to the protection of rivers and habitat) are currently
electives in training packages, and consideration is being given to whether more of this
information needs to be delivered in mandatory units. There may be the need to consider
adding further units which cover training in broader environmental issues – such as
whether or not an area needs to be flooded periodically, and what the criteria for such a
situation would be.
The national harmonisation project continues to be a source of change for the industry.
While Victoria will not be implementing the new national rules from 1 January 2012 (and it
is not yet clear when the changes will be implemented) it is assumed that they will be
brought in at some stage. This will require some changes to the OH&S units within the
training packages. However it is not thought that there will be any changes to the skills
required. (For example, the changes will require operators to know the national standard
for the height you are allowed to work at before different safety measures are required.)
The construction of the desalination plant continues, although it has been hampered
because the site has been to wet for construction work. With the change from dry to wet,
there is no longer a pressing need for its completion. However once it is completed the
plant will need to be in operation in order for the plant to be maintained in working order.
Estimates are that the number of operational staff required is around 30-50. The subject of
who will train those people is still under discussions. (The WA experience was that they
flew in overseas experts rather than train people in Australia). However, with the new
Deloitte Access Economics
121
2012 ITAB Market Effectiveness Report
water training centre in Chisholm TAFE, it may be that training is able to be provided
through this campus. Teachers with the required expertise to conduct the training may
prove to be the problem, in which case the training would most likely be conducted inhouse.
While intelligent water systems are only in the early stages of uptake, they are likely to be
a large driver of change in the industry in the future. The installation of these meters will
fall under the Water ITAB, and the installers will require training to undertake this job.
Meter replacement can be dangerous (for example in older houses the earth is often placed
on the water pipes, which would result in electrocution), and the training packages are still
at the policy development stage.
Industry outlook
Water, along with gas and electricity, is an essential service. As such, demand does not
fluctuate substantially during economic cycles. Rather, long term influences such as
population growth underpin steadily rising demand for water over time.
Around Australia, water prices have risen sharply in recent years. In part, that reflects the
need by water utilities to undertake new investment in order to secure steady water
supplies during periods of inconsistent rain and drought. That price growth has been
stronger in Victoria than elsewhere. Indeed, according to the Australian Bureau of
Statistics, between early 2007 and mid 2011, the price of water and sewerage services in
Melbourne increased by more than 70%, compared to a 54% increase on average around
Australia.
The level of investment in water in the State is quite strong. A funding arrangement for the
second stage of the Northern Victoria Irrigation Renewal Project has been agreed to by the
Australian and Victorian governments, which will see work on that project continue until
around 2018, while other long term projects such as the $688 million open channel to
pipeline conversion in the Wimmera Mallee region of Victoria continue.
Work on the new $5.7 billion desalination plant in Gippsland’s Wonthaggi region was due
to be finalised at the end of 2011 however the project is now expected to wrap up closer to
the contracted completion date of mid 2012. The project will see up to 200 billion litres of
water per year supplied to Melbourne, Geelong and regional communities.
Chart 19.1: Employment outlook – Victorian water industry
'000 persons
14
Forecast
Change on year earlier
60%
Forecast
12
40%
10
20%
8
6
0%
4
-20%
2
Victoria
0
Water
-40%
1998
2002
2006
2010
2014
1998
2002
2006
2010
2014
Source: Deloitte Access Economics, Australian Bureau of Statistics
Deloitte Access Economics
122
2012 ITAB Market Effectiveness Report
The lack of rain over the past decade, and moves to revive the Murray Darling Basin, have
been the key drivers of investment in water in Victoria. Although a strong La Nina event
through 2010 and into 2011 generated substantial rainfall and extensive flooding around
the State, the trend toward more irregular falls are expected to continue.
The charts above show employment forecasts for the water supply, sewerage and drainage
services component of the utilities industry in Victoria. Although somewhat volatile,
employment in the industry has been trending up over the last decade. Data from the
Australian Bureau of Statistics suggests that strong growth continued in 2011, possibly due
to the finalisation of construction at the new desalination plant site. After employment
growth of almost 40% in the industry over the last two years, Deloitte Access Economics
expects some consolidation in 2012, with employment projected to level off in line with the
timing for the completion of the desalination plant.
Occupations in demand and critical skill shortages
Response to 2011 critical skill shortages
There were no critical shortages identified in 2011 list for the Water industry.
Occupations in demand and critical skill shortages in 2012
Two occupations have been identified as experiencing high demand presently – civil
engineers and water and waste water treatment plant operators. However, the demand is
largely in regional areas where it is difficult to attract people. An additional problem in
attracting civil engineers is that pay scales are regulated, and do not allow any flexibility to
pay the engineers at a higher rate of pay. Around 20-30 additional civil engineers are
estimated to be required in the regional areas.
Victoria has the new best practice framework for water treatment, which was a Victorian
initiative brought in over the last year. While the training is not mandatory, it is expected
that all water authorities will put their employees through the new training. The result of
the new framework is that, in the short term, water authorities do not have enough
operators to operate at the required level. The training required is a Certificate III or IV in
water industry operations (water treatment), depending on the treatment process at the
plant. The number of people estimated to require this training is around 40, and it is
expected that this training will occur in 2012.
The encouragement of individuals to take up the Certificate IV in training so that current
workers are able to teach in RTOs has seen an initial group of 15 people complete this
qualification, with a second group planned.
The tables below summarise the occupations in demand for 2012, and identify the ANZSCO
classification for each occupation.
Occupations in demand and experiencing critical skill shortages
Occupations in demand
Industry title
ANZSCO classification
Civil engineers*
Water and Waste Water Treatment Plant Operators*
Civil Engineer (233211)
Waste Water or Water Plant Operator (712921)
* Note: Relates to regional areas only.
Deloitte Access Economics
123
2012 ITAB Market Effectiveness Report
Appendix A: Industry concordance
Table A.1: Concordance between ITAB industry structure and ABS ANZSIC classification
ITAB Industry
Automotive
ANZSIC Industry
Motor Vehicle and Motor Vehicle Part Manufacturing
Other Transport Equipment Manufacturing
Motor Vehicle and Motor Vehicle Parts Wholesaling
Motor Vehicle Retailing
Motor Vehicle Parts and Tyre Retailing
Automotive Repair and Maintenance
Building and construction
Residential Building Construction
Non-Residential Building Construction
Heavy and Civil Engineering Construction
Land Development and Site Preparation Services
Building Structure Services
Building Installation Services
Building Completion Services
Other Construction Services
Business services
Waste Collection Services
Waste Treatment, Disposal and Remediation Services
Central Banking
Depository Financial Intermediation
Non-Depository Financing
Financial Asset Investing
Life Insurance
Health and General Insurance
Superannuation Funds
Auxiliary Finance and Investment Services
Auxiliary Insurance Services
Motor Vehicle and Transport Equipment Rental and Hiring
Farm Animal and Bloodstock Leasing
Other Goods and Equipment Rental and Hiring
Non-Financial Intangible Assets (Except Copyrights) Leasing
Property Operators
Deloitte Access Economics
124
2012 ITAB Market Effectiveness Report
ITAB Industry
ANZSIC Industry
Real Estate Services
Scientific Research Services
Legal and Accounting Services
Advertising Services
Market Research and Statistical Services
Management and Related Consulting Services
Other Professional, Scientific and Technical Services
Computer System Design and Related Services
Employment Services
Other Administrative Services
Building Cleaning, Pest Control and Gardening Services
Packaging Services
Community services & health
Hospitals
Medical Services
Pathology and Diagnostic Imaging Services
Allied Health Services
Other Health Care Services
Residential Care Services
Child Care Services
Other Social Assistance Services
Cultural & recreation
Motion Picture and Video Activities
Sound Recording and Music Publishing
Radio Broadcasting
Television Broadcasting
Libraries and Archives
Museum Operation
Creative and Performing Arts Activities
Sports and Physical Recreation Activities
Amusement and Other Recreation Activities
Electro-technology & communication
Printing and Printing Support Services
Reproduction of Recorded Media
Electricity Generation
Electricity Transmission
Electricity Distribution
On Selling Electricity and Electricity Market Operation
Deloitte Access Economics
125
2012 ITAB Market Effectiveness Report
ITAB Industry
ANZSIC Industry
Gas Supply
Newspaper, Periodical, Book and Directory Publishing
Software Publishing
Internet Publishing and Broadcasting
Telecommunications Services
Internet Service Providers and Web Search Portals
Data Processing, Web Hosting and Electronic Information Storage Services
Other Information Services
Food
Food, Beverage and Tobacco Product Manufacturing
Forestry
Forestry and Logging
Forestry Support Services
Log Sawmilling and Timber Dressing
Other Wood Product Manufacturing
Pulp, Paper and Paperboard Manufacturing
Converted Paper Product Manufacturing
Furniture
Furniture Manufacturing
Manufacturing and engineering
Mining
Other Manufacturing
Petroleum, Coal, Chemical, Polymer and Rubber Product Manufacturing
Non-Metallic Mineral Product Manufacturing
Primary Metal and Fabricated Metal Product Manufacturing
Professional and Scientific Equipment Manufacturing
Computer and Electronic Equipment Manufacturing
Electrical Equipment Manufacturing
Domestic Appliance Manufacturing
Pump, Compressor, Heating and Ventilation Equipment Manufacturing
Specialised Machinery and Equipment Manufacturing
Other Machinery and Equipment Manufacturing
Architectural, Engineering and Technical Services
Machinery and Equipment Repair and Maintenance
Primary industry
Nursery and Floriculture Production
Mushroom and Vegetable Growing
Fruit and Tree Nut Growing
Sheep, Beef Cattle and Grain Farming
Deloitte Access Economics
126
2012 ITAB Market Effectiveness Report
ITAB Industry
ANZSIC Industry
Other Crop Growing
Dairy Cattle Farming
Poultry Farming
Deer Farming
Other Livestock Farming
Aquaculture
Fishing
Hunting and Trapping
Agriculture and Fishing Support Services
Parks and Gardens Operations
Veterinary Services
Racing
Horse and Dog Racing Activities
Service Industries
Agricultural Product Wholesaling
Mineral, Metal and Chemical Wholesaling
Timber and Hardware Goods Wholesaling
Specialised Industrial Machinery and Equipment Wholesaling
Other Machinery and Equipment Wholesaling
Grocery, Liquor and Tobacco Product Wholesaling
Textile, Clothing and Footwear Wholesaling
Pharmaceutical and Toiletry Goods Wholesaling
Furniture, Floor Covering and Other Goods Wholesaling
Commission-Based Wholesaling
Motor Vehicle Parts and Tyre Retailing
Fuel Retailing
Supermarket and Grocery Stores
Specialised Food Retailing
Furniture, Floor Coverings, Houseware and Textile Goods Retailing
Electrical and Electronic Goods Retailing
Hardware, Building and Garden Supplies Retailing
Recreational Goods Retailing
Clothing, Footwear and Personal Accessory Retailing
Department Store Retailing
Pharmaceutical and Other Store-Based Retailing
Non-Store Retailing
Retail Commission-Based Buying and/or Selling
Accommodation and Food Services
Travel Agency and Tour Arrangement Services
Deloitte Access Economics
127
2012 ITAB Market Effectiveness Report
ITAB Industry
ANZSIC Industry
Gambling Activities
Personal Care Services
Funeral, Crematorium and Cemetery Services
Other Personal Services
Textile, clothing & footwear
Textile Manufacturing
Leather Tanning, Fur Dressing and Leather Product Manufacturing
Textile Product Manufacturing
Knitted Product Manufacturing
Clothing and Footwear Manufacturing
Transport and storage
Transport, Postal and Warehousing
Water
Water Supply, Sewerage and Drainage Services
Deloitte Access Economics
128
2012 ITAB Market Effectiveness Report
Appendix B: Industry consultation
This appendix has been provided to the Higher Education and Skills Group in confidence.
Deloitte Access Economics
129
2012 ITAB Market Effectiveness Report
Appendix C: Australian
Apprenticeships – National Skills
Needs List, January 2010
This regularly updated list includes trades which are experiencing persistent skills shortage
on a national level, based on DEEWR labour market research. The Federal Government
offers incentives for employers to take on apprentices in these fields, as well as benefits for
the apprentices themselves. These include the Support for Adult Australian Apprentices
payment, Tools For Your Trade payment, Rural and Regional Skills Shortage incentive and
the Securing Australian Apprenticeships initiative.
The trades included on the January 2010 list are shown in the table below, grouped by each
ITAB.
ITAB
Trades needed
Automotive
Automotive electrician, Panel beater, Motor mechanic, Vehicle body
maker, Vehicle painter, Vehicle trimmer
Building and construction
Bricklayer, Carpenter, Carpenter and joiner, Drainer, Fibrous
plasterer, Gasfitter, General plumber, Mechanical services and airconditioning plumber, Painter and decorator, Roof plumber, Roof
slater and tiler, Solid plasterer, Stonemason, Wall and floor tiler
Business services
n/a
Community services and health
n/a
Culture and recreation
n/a
Electro-tech and Comm.
Binder and finisher, Communications Linesperson, Electrical
powerline tradesperson, Electrician (Special class), Electronic
equipment tradesperson, General Communications Tradesperson,
Printing Machinist, Screen printer
Food processing
Baker, Butcher (including smallgoods producers), Pastry cook
Forestry
Wood machinist (A-grade)
Furnishing
Floor finisher, Furniture finisher, Furniture upholsterer, Picture
framer
Manufacturing and engineering
Aircraft maintenance engineer (Avionics), Aircraft maintenance
engineer (Mechanical), Boat builder and repairer, Electronic
equipment tradesperson, Fitter, Flat glass tradesperson, Locksmith,
Metal fabricator, Optical mechanic, Pressure welder, Refrigeration
and air-conditioning mechanic, Sheetmetal worker (First class),
Toolmaker, Welder (First class)
Primary
Tree surgeon, Landscape gardener
Racing
n/a
Services
Cook, Hairdresser
TCF
n/a
Transport and storage
n/a
Water
n/a
Source: www.australianapprenticeships.gov.au
Deloitte Access Economics
130
Limitation of our work
General use restriction
This report is prepared solely for the use of the Higher Education and Skills Group of the Victorian
Department of Education and Early Childhood Development. This report is not intended to and
should not be used or relied upon by anyone else and we accept no duty of care to any other person
or entity. The report has been prepared for the purpose of presenting analysis on training market
effectiveness and skill needs in Victoria. You should not refer to or use our name or the advice for
any other purpose.
Contact us
Deloitte Access Economics
ACN: 49 633 116
Level 1
9 Sydney Avenue
Barton ACT 2600
PO Box 6334
Kingston ACT 2604 Australia
Tel: +61 2 6175 2000
Fax: +61 2 6175 2001
www.deloitte.com/au/economics
Deloitte Access Economics is Australia’s preeminent economics advisory practice and a
member of Deloitte's global economics
group. The Directors and staff of Access
Economics joined Deloitte in early 2011.
Deloitte refers to one or more of Deloitte Touche
Tohmatsu Limited, a UK private company limited
by guarantee, and its network of member firms,
each of which is a legally separate and
independent entity. Please see
www.deloitte.com/au/about for a detailed
description of the legal structure of Deloitte
Touche Tohmatsu Limited and its member firms.
About Deloitte
Deloitte provides audit, tax, consulting, and
financial advisory services to public and private
clients spanning multiple industries. With a
globally connected network of member firms in
more than 150 countries, Deloitte brings worldclass capabilities and deep local expertise to help
clients succeed wherever they operate. Deloitte's
approximately 170,000 professionals are
committed to becoming the standard of
excellence.
About Deloitte Australia
In Australia, the member firm is the Australian
partnership of Deloitte Touche Tohmatsu. As one
of Australia’s leading professional services firms.
Deloitte Touche Tohmatsu and its affiliates provide
audit, tax, consulting, and financial advisory
services through approximately 5,400 people
across the country. Focused on the creation of
value and growth, and known as an employer of
choice for innovative human resources programs,
we are dedicated to helping our clients and our
people excel. For more information, please visit
our web site at www.deloitte.com.au.
Liability limited by a scheme approved under
Professional Standards Legislation.
Member of Deloitte Touche Tohmatsu Limited
© 2011 Deloitte Access Economics Pty Ltd