This work from NCVER focuses on how the proportion of workers with vocational education and training (VET) qualifications has changed since 2006.

The workforce is now more educated, but are their skills being used well?

A changing dynamic?

A new report from NCVER’s Lisel O’Dwyer and Ian White is entitled “The dynamics of qualifications: implications for VET.”

As the report points out:

“The analysis finds that, over the last decade, the overall workforce has become more educated: the proportion of workers holding VET or higher education qualifications has increased, while the numbers and proportion of workers without post-school qualifications has correspondingly decreased.”

However:

“The study also revealed a general mismatch in terms of the skill level (and relevance) of the highest qualifications held by workers and the level of skill required for the job, with many more workers holding qualifications that ‘exceed’ the skill requirements for their occupation.”

That’s interesting!

So, what are the key messages?

First, the supply of qualified workers has risen sharply between 2006 and 2016.  Based on Census data, the paper reports that around two-thirds of all workers in 2016 held a post-school qualification compared with just over half (55.5%) in 2006.

The increase in post-school qualifications was greatest for higher education qualifications (33.5%). This was followed by diplomas (19.6%) and then VET certificates (5.3%). The study also found that “younger workers are more likely than older workers to have higher education qualifications, while older workers are more likely to have VET qualifications.” However, other research has suggested that younger people may require additional VET qualifications to compensate for their lack of experience.  Unfortunately, Census data only reports the highest level of qualification held, so that may hide another interesting story.

The big growth areas in employment over the period have been community and personal service workers (44.3%) and professionals (31.3%).

In addition, “the 2015 ABS Survey of Qualifications and Work shows that the closest match between qualification held and the level of qualification considered ‘most relevant to their current job’ is for workers holding VET certificates (90.3%), followed by workers with higher education qualifications (78.6%) and those with diplomas (60.8%).” This survey also found that workers with technician or trades qualifications “are most likely to be working in the same field as their field of study, relative to all other qualification levels and occupations.”

Part of the story is qualification creep

A key driver of the growth in the supply and demand for higher education qualifications has been the ongoing ‘professionalisation’ of occupations that were previously VET focused, for example ambulance officers and paramedics, dental hygienists, technicians and therapists, and medical imaging professionals. In these cases, the share of VET-qualified workers in those occupations declining over the 10 years, the report found.

On the other hand, “VET is playing an increasingly important role in providing formal skills development for several occupations that have historically been dominated by workers without post-school qualifications, such as truck drivers, storepersons, kitchenhands and labourers.”

What’s the message for VET?

The report concludes that “VET is being ‘crowded out’ by higher education, a development that may signal overqualification: in a tight labour market, overqualification may reflect credentialism and qualification inflation.”

O’Dwyer and White suggest that “future demand for VET will be underpinned by certificate-level VET for school students, entry-level roles, trades and non-professional occupations in high-employment growth sectors such as the human service.”