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National

RMIT ABC Fact Check

Richard Marles says there are 70,000 fewer apprentices and trainees than there were in 2013. Is that correct?

Richard Marles Coalition Fact Check Labor RMIT Scott Morrison

Deputy Opposition Leader Richard Marles says there are 70,000 fewer apprentices and trainees since 2013, when the Coalition came to office. (ABC News: Matt Roberts)

The claim

As the election campaign ramps up, Labor has accused the Coalition of overseeing a national skills crisis due to falling numbers of apprentices and trainees.

On February 1, 2022, Deputy Labor Leader Richard Marles took to Twitter to reject a claim by Prime Minister Scott Morrison that his government's response to the pandemic had avoided a "lost generation of skills".

"We haven't lost a generation, we've lost nearly a decade," he tweeted as Mr Morrison delivered a televised speech.

"There are 70,000 fewer apprentices and trainees today then there was in 2013," Mr Marles wrote.

Is that correct? RMIT ABC Fact Check investigates.

The verdict

Mr Marles's claim is spin.

Although the combined number of apprentices and trainees fell by roughly 70,000 under the Coalition, that total masks two very different stories.

The number of trainees has fallen by just under 73,000 since the Coalition was elected. Meanwhile, the number of trade apprentices has risen by 1,500.

Importantly, the fall in trainees began before the Coalition came to power.

This followed changes introduced in 2012 by the then Labor government to address well documented and systemic problems relating to employer training subsidies.

The fall in traineeships was, in fact, larger under one year of Labor than under the first seven years of Coalition government.

Experts consulted by Fact Check also said the trainee and apprentice figures were influenced by a range of complex factors, including the uncapping of university places, the end of the mining boom and the long-term decline of manufacturing.

But both traineeships and apprenticeships are reliant on government subsidies, and the latest available data includes a significant jump in either category following the introduction of temporary COVID-19 measures.

This reversed many of the losses sustained during the Coalition's first seven years.

Apprenticeships generally involve gaining skills in a trade, while traineeships take place in non-trade industries such as retail. (ABC News: Ellen Jolley)

A claim for every occasion?

When it comes to apprentices, subtle differences in terminology allow politicians to focus on figures which suit their narrative.

In his speech, for example, Mr Morrison said his government had boosted the combined number of "apprentices and trainees" by 27 per cent. He then switched his focus to the current number of "trade apprentices", excluding trainees.

Fact Check has previously explained how apprenticeships and traineeships are similar but separate categories of training.

In his claim, Mr Marles referred to the combined number of "apprentices and trainees".

So, what are they?

Apprenticeships and traineeships are programs that combine on- and off-the-job training, allowing people to earn a qualification while collecting an income.

Most apprenticeships are in traditional trades such as carpentry, plumbing and hairdressing, and usually take around four years to complete.

Traineeships typically take 1-2 years. These courses, which have existed only since the 1980s, cover a wide range of jobs in areas such as retail, childcare, events management and information technology.

Where’s the data?

The relevant data is collated by the National Centre for Vocational Education Research (NCVER), an independent company jointly owned by federal, state and territory governments, which counts the number of people in training at the end of each quarter.

A spokeswoman told Fact Check that due to "[classification] differences across states and territories", the centre did not produce its figures on the basis of apprentices but adopted the proxy measures of trade (apprentices) and non-trade (trainees).

Fact Check has extracted the quarterly data from the centre's online database. At the time of the claim, the most recent available data was for June 2021.

NCVER also publishes an annual series (based on June data) back to 1963.

What do the numbers say?

Mr Marles said the number of apprentices and trainees had fallen by 70,000 since 2013.

Indeed, from when the Coalition was elected in September 2013 until June 2021, the number of people in either type of training fell by roughly 71,000 — from 412,630 to 341,383.

However, that decrease was entirely among (non-trade) traineeships, which fell by 73,000 as (trade) apprenticeships rose marginally to 1,500 above their 2013 levels.

Most of the losses occurred before 2016, after which apprentice numbers remained relatively flat for several years while trainees fell slightly.

The data also reveals a significant leap in the final nine months of the series.

In the seven years to September 2020, the combined number of trainees and apprentices had fallen by 148,000. From then until June 2021, the total surged by 77,000 (30 per cent), wiping out roughly half of the losses.

That surge coincided with the introduction of temporary COVID-19 measures, including a 50 per cent wage subsidy (capped at $7,000 per quarter for 12 months) for new or recommencing apprentices and trainees.

The 2021-22 federal budget suggests this measure will expire in 2023.

What's missing from this picture?

Although Mr Marles singled out the Coalition's record, the collapse in traineeships began in 2012, before the government was elected.

In fact, the annual data reveals traineeships fell by 104,000 in Labor's final year alone.

That compares with a drop of 109,000 across the Coalition's first seven years.

The back story

The crash in traineeships came after Labor tightened the eligibility criteria for so-called incentive payments, paid to employers to subsidise the cost of training.

As Michael Coelli, an associate professor of economics at Melbourne University, told Fact Check, it had become apparent by 2012 that the system had problems, with evidence suggesting traineeships — whose numbers had been skyrocketing since the 1990s — "weren't that productive" and were being "abused by employers to reduce their labour costs".

Indeed, various papers explain how traineeships were increasingly going to people who were already employed, with incentives acting as an implicit wage subsidy (of up to 20 per cent).

And while these payments had helped boost enrolments, they were also associated with lower completion rates and higher rates of cancellation, NCVER wrote in 2021.

The 2012 changes meant existing workers no longer attracted incentives at the start of their traineeship unless their qualification addressed a skills need specified by the government.

What the experts say

Monash University professor of education Gerald Burke told Fact Check via email that the withdrawal of existing worker incentives was "the main reason" for the fall in traineeships.

At the same time, he said, incentives were "fully maintained for trades — nearly all of which were on the [government's priority list]".

Dr Coelli agreed that incentives had driven the decline, noting that some of the falls would have occurred in 2013 and beyond as there were "people still in the pipeline".

And while these past changes were limited to trainees, Dr Coelli said apprenticeships were also reliant subsidies, without which they would be a "loss maker" for employers.

"So if the government fools around with those payments they have a big effect," he said.

The 2021 NCVER report pinpoints the same primary cause, adding that the fall was preceded by a spike in commencements after the 2012 changes were announced, "with employers taking advantage of the incentives while they could".

Mike Dockery, principal research fellow at the Bankwest Curtin Economics Centre, told Fact Check it was important to also consider the broader factors at play — both positive and negative — when interpreting the apprentices and trainees data.

"The growth in higher education participation, for example, comes partly at the expense of VET participation," he said.

NCVER has also explained how "a subdued labour market and the uncapping of university places have an impact on the number of people entering into apprenticeships and traineeships", while the Parliamentary Library has highlighted the effect of job losses in utilities and the mining industry between 2012 and 2016.

In addition, experts told Fact Check that apprentices would have been particularly affected by the long-term decline in manufacturing employment.

The longer view

Finally, it should be said that while Mr Marles referred to the training numbers in raw terms, historical comparisons should ideally take population growth into account.

For completeness, Fact Check has calculated the number of people in training as a share of Australia's working age population (aged 15 to 64 years) and of its employed population since 1978 (the earliest data available).

As with the raw figures, the combined rates of apprentices and trainees peaked in 2012. By 2021 they were roughly 40 per cent lower on either population-adjusted measure.

For apprentices alone, in June 2021 these remained below their 2013 levels (at 1.3 per cent of the working age population, or 1.6 per cent of employed people).

The historical series should, however, be interpreted with some caution, with Professor Dockery noting that the figures were not "strictly comparable" over the longer term due to changes in the number of courses available, how these were structured and what organisations were delivering them.

Principal researcher: David Campbell

factcheck@rmit.edu.au

Sources

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