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Modern apprenticeships: plugging the skill gap

Modern apprenticeships: plugging the skill gap

By Rt Hon Helen Clark, Prime Minister

In recent years we have heard quite contradictory reports about the level of skills training in industry. On one hand we are told that the numbers in industry training have never been so great. On the other, families complain that they have never found it so hard to get young people into work-based training, and industry is expressing concern about skills shortages.

In the 1990s there were around 27,000 apprentices at a time. The defenders of the industry training system of the 1990s point to numbers of industry trainees now running at about 56,000, of whom they say some 24,000 are seeking to gain the National Certificates which replaced the traditional “apprenticeship orders”.

That latter figure itself , however, would suggest that the numbers in apprenticeship-style training are down.

It also remains unclear how many of the present industry trainees overall actually complete their training. Anecdotal evidence suggests that completion of apprenticeships is uneven. The financial incentives on industry training organisations have encouraged the signing-up of training agreements, rather then the ensuring of completions.

There is evidence that young people are missing out on trade training opportunities. In December 1999 only ten per cent of trainees in structured industry training were aged 16 – 19 years. Two-thirds were aged 25 years and older. In some industries, there are high numbers in the forty-plus age group.

From a public policy point of view government has to consider what it can do to increase training opportunities for young people. As well as it being an issue of justice, more skills training for young people is also an economic necessity.

The December 1999 NZIER Quarterly Survey of Business Opinion reported that 35 per cent of firms were finding it more difficult to find skilled labour.

A survey of Wellington manufacturers late last year found more than half reporting skills shortages, and the same trend is clear in Auckland.

The Northern Employers’ and Manufacturers’ Association has reported that in December 1999 33 per cent of manufacturers were finding skilled staff increasingly difficult to recruit. That had risen to 45 per cent in January, and the latest information on the February survey suggests the number is up to 56 per cent.

The good news is that the economy is growing. It would be a tragedy to have this growth nipped in the bud because we are not giving people the chance to be part of the skilled workforce.

The huge importance of boosting participation in skills training and opening up opportunities for young people in employment was stressed by Labour in opposition and is being given high priority now we are in government.

The Modern Apprenticeship Programme the government announced this week, aimed mainly at 16 to 21-year-olds, provides a new way into high quality, work-based training.

There will be a pilot scheme this year, with the intention of going nationwide from early 2001. The aim is to have up to 3000 new modern apprenticeships in place by early 2002.

We expect that the potential apprentices will have gained some qualifications at school and be ready to study at levels three and four on the National Qualification Framework.

What will distinguish Modern Apprenticeships from other tertiary education with a work-based component will be that the apprentices will be employed.

The scheme does not propose financial incentives to take on apprentices, however. The evidence from such a scheme in the early 1990s was that ninety per cent of the employers who received the incentive would have taken on an apprentice whether the incentive had been available or not.

The big innovation in the government's Modern Apprenticeships Programme is to fund Apprenticeship Co-ordinators. They will:

 screen potential apprentices and arrange work placements with employers; and

 work with employers and apprentices to produce an individual training plan, and, where necessary, manage the training arrangements and ensure that the training leads to assessment for credits towards a complete national qualification.

In this way we aim to make it as easy and straightforward as possible for employers to take on apprentices.

 Co-ordinators will ensure that systems are in place to guarantee training quality and continuity. If an employer no longer could provide work for an apprentice, the broker would arrange for the apprentice to complete a National Certificate with another employer.

 Co-ordinators will also aim to increase the numbers of Pacific Island young people in apprenticeships, in light of the government's commitment to closing the gaps between Maori and Pacific peoples and other New Zealanders. Trade training was traditionally a route for upward mobility for Maori and can be again.

The co-ordinators could limit their activity to placement of the apprentices, oversight of the training, and mentoring – or they could actually directly employ potential apprentices and then hire them out to firms for work based training.

Apprenticeship Training New Zealand, a successful apprenticeship organisation whose focus is now nationwide, is a good example of the latter options. With strong support from the relevant industry training organisations, industry, and the Engineers Union, ATNZ has played a pioneering role in establishing new apprenticeship arrangements.

The new co-ordination scheme will come under the oversight of Skill New Zealand. Costs are estimated at $2,200 per apprentice a year. Between $27 million and $29 million has been allocated over the next three years for the scheme.

The Modern Apprenticeships Programme is our first step in addressing the problem of skills shortages. Announced on our 103rd day in office, it is clear how high a priority raising skill levels and providing opportunity for young people has for this new government.


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