Surge in apprenticeships helped by government subsidies

Seen as cost-effective way for employers 'to get the skills and help they need'

Surge in apprenticeships helped by government subsidies

Apprenticeships in Australia continue to grow dramatically.

How much? There were 415,240 apprentices and trainees in training as of June 30, 2022, representing a 21.60% increase from the previous 12 months.

There has also been a surge in commencements with a 22.1% rise from June 2021 and a healthy 15.3% completion in the same 12-month period.

“Apprenticeships are the most cost-effective way for small businesses to get the skills and help they need,” Ben Bardon, CEO, National Australian Apprenticeship Association, said.

“A lot of small businesses use apprentices because that is the pathway that they took. It is an altruistic type of motivation.”

The federal government offered very generous incentives during the pandemic for businesses to hire apprentices, he said, “though this is now being wound back.”

As of March 2022, more than 73,000 Australian businesses had received federal government support through the Boosting Apprenticeships Commencements subsidy, which included 50% of an eligible Australian apprentice’s wage in their first year.

“We need apprenticeships as it is a sound pathway to train young talent and it is done in a fair way,” Bardon said. “It is a regulated industry that provides incentives for both the employee and employer.”

‘New ideas, new thinking’

There are many employers who go down the apprentice route time and again and see the long-term benefits.

“Since 2012, we hired more than 455 apprentices and trainees,” Betty Hui, technical capability partner, Jemena, said.

The company has 135 undertaking apprenticeship or traineeship across four states — Queensland, New South Wales, Victoria and Tasmania — in a variety of trades, such as electricians, lineworkers, cable jointers, gas services technicians, testers, and asset inspectors amongst other categories.

And 252 apprentices/trainees have successfully completed their Apprenticeship/Traineeship, she said.

“Our retention rate for the first 12 months after graduation is more than 92%.”

Jemena have received a variety of government support such as payroll tax exemption, employer incentives, wage subsidies and training funding from state government.

“We love hiring apprentices because new young talent bring in new ideas, new thinking, collaborations between young and experienced workers,” Hui said. “Apprentices also address skill shortages in the utility industry, increase the workforce capability and mobility. It also fosters a ‘culture of learning’ within the enterprise and overall it improves employee morale, improving loyalty and employee retention.”

Australian apprentice and trainee graduates are now finding jobs at a higher rate than pre-pandemic levels, according to the National Centre for Vocational Education Research (NCVER).

Skill shortages

Australia, does, however, face skill shortages in several key areas. The Australian Apprenticeship Priority List as of January 1, 2023, reveals the need for agricultural and agritech technicians, air conditioning and mechanical services plumbers, air conditioning and refrigeration mechanics, automotive electricians, cablers, civil engineering technicians and electricians amongst other categories.

“We definitely need more businesses hiring apprentices,” Bardon said. “We need government support wherever possible as hiring apprentices is a fair and equitable way to hire young talent.”

Bardon believes that ensuring apprentices finish their apprenticeship and stay on within the business comes down to the culture of the business.

“A good human resources department can go a long way to helping guides apprentices through their training,” he said. “If workplace issues arise, apprentices want to know that they have someone to go to in order to sort the problem out. By having a third party to help work through the issues, it can make an apprentice feel more confident that the workplace takes issues seriously.”

The federal government has increased the number of occupations covered by the Australian Apprenticeship Priority List from 77 to 111, as part of the Australian Apprenticeship Incentive System.

This will increase the number of occupations eligible for additional support, including up to $5,000 in direct payments to apprentices, and a wage subsidy of up to $15,000 for employers.

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