australias innovation performance lagging

Australia’s innovation performance lags other developed economies. Doing better on innovation means getting smarter about VET.

Australia does have a problem with innovation. Not a big problem, but a niggling under-performance. And the link with VET is clear – VET grows the skills base that adapts and applies innovation in practical, day-to-day circumstances.

The innovation problem was highlighted again recently in a World Economic Forum (WEF) publication, The Global Competitiveness Report 2016-2017. At 400 pages, it’s a solid read. However, just a couple of pages will do for our purposes here. Australia’s overall performance dashboard is on page 102, and our performance against all the competitiveness measures appears on page 103. The end result is that Australia ranks 22nd of 138 nations.

There’s a summary about Australia’s record on page 102 which reads, in part:

Innovation represents Australia’s challenge and imperative in the face of low commodity prices and China’s slowdown. In both business sophistication (28th, down one) and innovation (26th, down three), Australia not only lags far behind the best performers but also loses ground to them.

VET trained employees are key innovation players

Universities tend to gain the lion’s share of attention when it comes to innovation. That’s a pity because we miss a big part of the story.

If you look at page 103 of the WEF report, you’ll see two innovation measures we most struggle with – government purchasing of advanced technical products (think weapons systems and very fast trains) and university-industry collaboration on research and development (R&D).

There is an important role of VET trained workers in both these underperforming areas if Australia is to up its innovation game and stay with the frontrunners in competitiveness. People with VET qualifications will be doing the installation and maintenance work on advanced technical products when we do invest in them (the recently signed contract for submarine construction is an example). VET trained workers are also critical when it comes to extracting performance from the industry side of the university-industry R&D equation.

The Office of the Chief Scientist did some quarrying into Australia’s STEM workforce – those with skills and knowledge in science, technology, engineering and maths which make a key contribution to innovation. The Chief Scientist reported in March this year that 68 per cent of the nation’s STEM employees are VET trained (see the infographic here). The same report tells us 36 per cent of people with VET qualifications own their own businesses compared to 26 per cent of people with bachelor degrees or higher.

The VET trained workforce is doing some seriously heavy lifting. Their role is central to boosting Australia’s innovation stocks. Indeed, a TAFE Queensland report released in June (The VET era: Equipping Australia’s workforce for the future digital economy, 64 pages) goes straight to this point:

Entrepreneurship and innovation are likely to become increasingly important across all sectors of the economy and need to be given greater focus in the education system.
All workers will need to be able to work with technology in the future, making digital literacy a new core skill set.

VET professionals are in the front row for innovation.