Victoria’s Vocational Education and Training (VET) sector is struggling to meet the demands of the labour market and requires immediate reform to ensure a strong economic recovery in the wake of COVID-19.

The Skills for Victoria’s Growing Economy Review which was commissioned by the state government in 2019 and released last month provides a long list of recommendations to rebuild a “strained and overloaded” system.

The review found that the competitive market model in use today pits training providers against each other to deliver courses that generate short-term profit without the long-term benefit for learners or the Victorian economy.

“It also allocates too much risk to learners, who can pay widely different fees for courses that don’t always guarantee a good job today, or a ticket into the transformed labour market of tomorrow,” the report stated.

“COVID-19 has heightened these pressures because as people lose jobs, they seek training to be ready for new ones, potentially overloading a strained system.

“Early analysis indicates that unemployment is expected to peak at 11 per cent, higher than the recession of the early 1990s, and is likely to stay high until 2025, even after the state’s GDP begins to rebound.”

VET trains many of the workers who are on the frontline of the pandemic including nurses, tradespeople, construction, and business managers which are central to Victoria’s economic recovery. VET in Victoria accepts nearly 610,000 enrolments a year, compared to about 450,000 in higher education.

Modelling undertaken for the review found an active skills policy that anticipates and targets skills shortages could support the creation of an additional 415,000 jobs by 2030.

The review’s cornerstone recommendation is for the government to create a new, independent body, FutureSkills Victoria, to act as a champion and steward for the skills system.

The government will continue to determine policy, regulation and funding.

“FutureSkills Victoria would be a new platform to drive system reform and promote a new way for all parts of the system to work together, building on the collaborative spirit forged through COVID-19,” the review said.

The first three chapters of the report sets out the role of FutureSkills Victoria and warns that without reform Victorians will pay the economic and human price of a slower recovery. The most immediate priorities identified by the review include the development of a database to support planning and decision-making, this would be known as FutureSkills Insights.

It also recommends development of an annual Victorian Skills plan that sets out Victoria’s needs for the year ahead and beyond, as well as the creation of specialised FutureSkills Labs and improvements to professional learning for teachers.

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