Employers need to get involved in training youth

High youth unemployment is persistent and vocational training and strong connections between industry and education could be the way to get past it.
Nov 21, 2019

High youth unemployment is persistent and vocational training and strong connections between industry and education could be the way to get past it.

Many industries are facing skills shortages and there is an increasing number of young workers, and particularly vulnerable young workers, who need jobs and career skills. The two don’t seem to be integrating and that is because youth face numerous barriers that are not addressed by existing services.

A strong vocational training sector and employers who support learning on-the-job are essential to get young people experiencing vulnerability into meaningful work, according to a new report from Social Ventures Australia (SVA).

The report, Future Fair, supported by J.P. Morgan, examines major trends in the Australian labour market and how they are impacting the future prospects of young people, particularly those experiencing vulnerability.

The Future Fair report’s recommendations include reinvesting in TAFE because of its critical role as an ‘anchor’ institution that brings together employers, schools, and community members to address specific local labour market problems.

The report says government funded employment programs should be reformed to support the development of a highly skilled workforce. This includes ensuring these programs have an increased focus on skills development and placing young people into higher quality jobs.

Employers also need to step up their efforts to nurture young people, particularly those at a disadvantage in the labour market, both within their own enterprises and through their supply chains. Too many expect other employers or educators to provide young people with necessary skills. 

SVA Director for Employment, Lisa Fowkes, says participation in vocational training has been affected by a ‘perfect storm’ of poor policy decisions, a lack of strategic investment and an undervaluing of vocational training by the broader community.

“Declining rates of participation in vocational qualifications and declining investment by employers in training their workforce mean that there is less career mobility for those who start off with lower levels of education,” she said.

Since the global financial crisis, the gap between un and underemployment rates for young people and the overall workforce has grown. While many more young people are moving into university than in the past, not enough young people are gaining the types of vocational qualifications that are needed to fill skills shortages across our economy.

Robert Bedwell, Chief Executive Officer, Australia and New Zealand at J.P. Morgan says creating widely shared prosperity requires collaboration between business, government, non-profit and other civic organisations.

“J.P. Morgan has been supporting workforce development programs to prepare underserved youth for the future of work for over five years in Australia. Our work is clearly demonstrating that alternative pathways – outside of traditional university dominated education - to quality jobs are absolutely essential for these young people. However, our work also revealed the systemic challenges in the local market that need to be overcome,” he said.

Investment in VET (vocational education and training), particularly in TAFE, is falling far short of what our economy needs. Commonwealth and State Governments have started to recognise these issues. But employers, too, need to step up their efforts. The recent Joyce Review into the VET system recommended that every vocational qualification include workplace learning – whether through a traineeship or apprenticeship, or a work placement. But not enough employers are creating these opportunities. Some governments are creating very few opportunities for young people who don’t have university education to move into high quality jobs.

Fowkes continued, “Even though most commentators agree that the future of work will favour those with higher skills, labour market assistance pushes young people to take any job – it doesn’t have a skills focus. If this doesn’t change, young people will continue to face increased risk of poverty and of insecurity.  In the long-term inequality will increase and social mobility will be reduced,” She said.