A word from our CEO

Now that the carbon tax has made its way through the lower house and the expected to passing of the senate and into law, there is a heightened frenzy of debate about the impact of the new tax on the domestic economy. Christian Kerr from The Australian reports that research by the Australian Trade Industry Trade Alliance states that nine out of ten manufacturing jobs will feel the full impact of the carbon tax with the likely result being 950,000 domestic jobs coming under threat as employer’s battle increased costs. This is concerning given that employment, while still at low levels is starting to show signs of slowing. Proponents of the tax point to the creation of green jobs as an offset to the proposed job losses and the transition to a low carbon economy. However there is evidence showing that the creation of green jobs is not enough to offset the losses.

Economist Gabriel Calzada examined the effect of green energy mandates in Spain. Gabriel discovered that for every green job created there were 2.2 jobs lost (Forbes, 2011). This being the case there is a significant short fall in jobs due to a migration to a low carbon economy. As few people understand how a carbon tax works, I have briefly outlines the basics of its operation. A carbon tax is simply a pigouvian tax named after the English economist Arthur Pigou. Market pricing often does not capture the negative externalities (pollution) generated in its operation therefore, the social cost is not captured in the products private cost. The application of a pigouvain tax seeks to capture this cost, faced with this cost increase producers have an incentive to reduce production to a socially optimal level. Reduced production levels will also result in a decrease in demand for human capital resulting in job losses.

Structural changes in the economy often results in certain industries being impacted at greater levels than others. This was the case when the then Prime Minister Gough Whitlam significantly reduced the tariff level applied to imports. This impacted the Manufacturing, agricultural and textile industries. These industries are often classified as low skill. Australia has been moving to a higher skilled economy for some time now, and the impost of a Carbon tax is likely to speed this transition up.

The creation of green jobs will require higher skilled workers; those that are displaced due to the move to a low carbon economy will also require retraining into higher skill areas. Jobs data shows that the jobs growth is in high skilled areas, therefore, those who do not continue to develop and educate themselves will find it difficult to gain alternative employment should they be the victim of job displacement. Regardless if a Carbon tax makes it though the parliament or not the fact still remains the Australia is rapidly moving to a high skilled economy and must do so to remain competitive and maintain our living standard. Emerging economies are able to provide labour at a much cheaper rate than Australia causing low skill labour intensive industries move off shore.

Again, this highlights the importance of education and training and its relationship to the level of life earnings an individual can achieve. I would suggest that everyone regularly audit their skill levels to ensure they are up to date. Furthermore, your level of educational attainment needs to keep increasing; this will ensure you remain competitive in the job market. Remember, you never stop learning, if you do you may find you’ll stop earning.

In 1776 the “father of economics” Adam Smith published his landmark book Wealth of Nations. The key theory to come out of this book is the Division of Labour. As the Harvard Business Review states, this “would be one of the central drivers of economic progress for centuries to come”. Division of labour is the separation of a work process into a number of tasks to be performed by a person or group of people. This theory has given rise to the specialised worker. The concept fits well with the current federal Governments agenda of raising productivity.

Firstly you may ask, what is productivity? Productivity is the measure of national productivity. At a national level it captures the economy’s ability to harness its physical and human capital resources to generate output and income. In April last year the House of Representatives House Standing Committee of Economics report; Inquiry into raising the productivity growth in the Australian economy outlines that productivity growth has declined by about 0.4% annually since 2003-04. This is significant given that the division of labour is such a widely accepted practice. 

Access to a larger workforce through greater workforce participation is an area that can increase productivity. Currently, there are around 588,000 unemployed Australians with 6.3M classed as not in the workforce. The challenge is encouraging this cohort into the workforce through the necessary incentives and appropriate training.

Workforce participation and education level are closely linked. The Australian Chamber of Commerce and Industry (ACCI) note that an additional year of schooling can increase workforce participation by around 0.5% for men and 4% for females. Furthermore, I have recently outlined the proven link between the level of educational attainment and whole of life earnings. Even a certificate I or II can raise the level of life time earnings. Investing in training and educations pays dividends in many ways. This is the case for the individual when investing in their personal educational betterment and similarly for the government when providing subsidised training places. Given that the “average production worker” annual tax contribution is $7,428 (Department of Parliamentary Services) the combined lift in workforce participation of men and women of 4.5% would significantly increase the level of taxation income. This increased level of federal income would certainly offset investment in programs such as social inclusion to move the marginalised and disadvantaged into training and employment, not to mention the increase in economic productivity.

When considering the theory of the division of labour in this context of increased education; as labour becomes more knowledge based and communications technology advances, the division of labour accelerates. This gives way to hyper-specialisation, under this concept jobs can be redefined and lower skilled tasks off loaded. Consequently, lower level skilled positions may be further subject to declining wage levels, while higher skilled workers will continue to enjoy wages growth.

To effectively achieve divisions of labour the worker needs to be highly skilled in the task at hand. This comes through on-the-job training, increased competence through repetition and job related and general training. Again, the level of educational attainment is critical in a number of areas; directly linked to not only whole of life earnings and proved in recent columns but also thelevel of economic output an economy can achieve. Economic output is also directly related to the standard of living enjoyed by a nation. Australia enjoys a relatively high standard of living; further education and training will contribute to ensure this remains the case.

Did you know that more than 7 million Australian adults don’t have the reading skills considered necessary for every day life? This indicates that many people have a skill level where they struggle to perform adequately in their jobs.

Some alarming statistics include: 

• 46% of the population have prose literacy skills below level 3. For example: reading and understanding; communicating via email.
• 47% of the population have document literacy skills below level 3. For example: filling in forms.
• 53% of the population have numeracy skills below level 3. For example: filling in timesheets.
• 70% of the population have problem solving skills below level 3. For example: working independently, following non-routine directions , finding workable solutions for new challenges.

The Federal Government recently announced in the 2011-12 budget that there will be improved access to the Language Literacy and Numeracy Program (LLNP) for those in need. From 1 July 2011 the government will provide $143.1 million towards an additional 30,000 commencements over four years, and 30,000 commencements per annum thereafter. The LLNP is the Federal Government’s primary program for helping job seekers to address their language, literacy and numeracy skill gaps.

Given that increasing productivity is an agenda item for the current Federal Government, it is fitting that an increased investment in LLNP be undertaken. It is easy for politicians to take an easy approach and guide investment into business and industry capital through subsidy programs rather than invest in long term ‘invisible’ areas such as foundational skills. Investment in these areas is critical to increase economic productivity and accelerate long term growth. Research has revealed that raising a country’s adult literacy by just 1 per cent leads to a rise in productivity of 1.5 per cent and a 2.5 per cent increase in GDP.

At this point it is also important to bring a word of caution; just investing money and creating new places in programs such as this will not alone increase participation. Students with low levels of literacy and numeracy skills are also likely to bring with them issues of poverty, poor housing, poor health and family breakdown, which impacts on their attendance and achievements. The students socio-economic backgrounds are one of the main obstacles faced within LLNP. Sometimes it has become essential to engage the learner’s family to ensure positive outcomes are achieved in the program. It is essential that the student’s lifestyle, family history and previous educational experiences are considered when a student is accepted into the program as these factors have a major impact on their learning experiences and achievable outcomes. Furthermore, there is reluctance by those most at need to participate in these programs due to personal embarrassment to acknowledge they have low literacy levels and the negative ‘images’ attached to this.

Potential participants need to be encouraged and in some cases mentored just to get to the starting line. Once these barriers have been overcome and participants do engage, not only will we be on the way to achieving the economic growth outlined above due to raising literacy levels, additionally we will have a better functioning society with better engagement by individuals in community and reduced health, law and order costs. It was Simon Crean who once said “education is the great enabler”, how true that statement is.  

In Australia, vocational education has become a key part of training in industry. This is in addition to the more traditional tertiary education role. Many companies and organisations have embraced the VET system, aligning their training activities to the attainment of industry and job related qualifications.

Formal assessment of competencies against competency standards contained in industry specific training packages is a regular part of the development of staff in a wide variety of business, not-for-profit and government organisations. The 2011 Certificate IV in Training and Assessment (TAE40110) qualification is a mandatory requirement to train and assess nationally within the workplace or within a training organisation.

Certificate IV in Training and Assessment (TAE40110) has had various names in the past such as Certificate IV in Assessment and Workplace Training (BSZ40198), and most recently Certificate IV inTraining and Assessment (TAA40104). It has also been referred to as Train Small Groups, Train theTrainer etc,. All of these previous qualifications were necessary when people wanted to train bothinternally and externally.

The qualification has now been changed to Certificate IV in Training and Assessment (TAE40110) toreflect the changes in the workplace training standards and in the Vocational Education and Training(VET) environment. The main difference is the three VET units from TAA have been absorbed into thedesign, delivery and assessment units of TAE. The TAE has also reduced the number of units thatwere considered quite cumbersome, from 14 units to 10 units.

It is most important to understand that the trainer required qualification has remained Certificate IV in Training and Assessment. You may have seen marketing materials or advertising referring to the new qualification as “New Cert IV TAE” or the “Certificate IV in Training and Education”. However these terms are incorrect and misleading.

Jobs associated with this qualification may include:

•   Enterprise Trainers and Assessors
•   RTO Trainers and Assessors
•   HR Managers
•   Training Advisors
•   Learning Mangers
•   Vocational Education Teachers

 

Obviously everyone has different needs and situations. Both Certificate IV qualifications are seen as each others' equivalent. There is a current period of transition where RTO's phase out the previous qualification and begin offering the new Certificate IV in Training and Assessment. Once the transition phase is complete RTO's will no longer be able to offer the current qualifications, though the existing Cert IV will continue to be the benchmark standard for Training in Australia. At Western College we believe in delivering our students the most relevant and up to date qualifications, which is why we have already begun offering the TAE as our Certificate IV in Training and Assessment.

For those that already posses the Certificate IV in Training and Assessment TAA, please see our Bridging course that is available in our current course guide. This course provides you the pathway to obtain the Certificate IV in Training and Assessment TAE. While there are no current requirements to upgrade, this would be advantageous to you as it will provide you with the most up to date and current statement of attainment in this field. Our experienced and unsurpassed trainer will provide you with a full and comprehensive outline of the TAE in this course and offer alternate pathways if necessary for you to achieve the full TAE.

When studying your Cert IV in Training and Assessment consider finding a Registered Training Provider who: Understands your learning style; Is able to deliver the training and learning support in a suitable time frame; Offers flexibility which is matched to your lifestyle needs; And most importantly remembers learning was meant to be fun.

Ceretis Paribus is a Latin term commonly used in economics meaning “all things being equal”. In the Vocational nationally recognised training system where training is delivered from national training packages, one would expect this term to apply to the system. However in the VET (Vocational Education and Training) system all things are not equal. Currently, each state has its own VET regulator applying different auditing standards to their state providers. I was speaking recently with a large training provider that operates in multiple states. They outlined the auditing process they had been though in two states where they deliver the same course from the National training package. To their dismay, they were required to change areas of their compliance and delivery in one state but given a tick of approval in the other. Consequentially, this bring into question the whole notion of national training, why is their delivery accepted, even commended in one state while being found wanting in another? Furthermore, it devalues the qualification in the eyes of business and industry and reduces worker mobility between states. This is concerning as VET is a keymechanism used to train the workforce.

Emeritus Professor Denise Bradley in her review of the tertiary education system recommended a truly national system with the establishment of a single national body to regulate both the VET and Higher Education sector. After consideration of the recommendations and seeking feed back from stake holders, the Federal Government, through COAG decided to establish a National VET regulator and a separate higher education regulator. This is understandable considering the disparity in the approach and delivery of VET as apposed to Higher Education. However, this does raise some concerns for dual sector providers. A National VET regulator will ensure a consistent approach to VET is taken by auditors no matter what state the provider delivers in and also ensuring providers know what they have to comply with.

Currently, the legislation has been referred to a Senate committee and worryingly both Victoria and Western Australia have objected to handing all their auditing powers over to the Commonwealth. The objection lies with these states wanting to retain the right to audit their public providers and not subject them to the national audit process, while mirroring the National legislation. The question that must be asked is how we can have a truly national system when some providers are subject to different auditing regulators than others. Furthermore, why should the public provider be treated differently and how can quality be assured?

New South Wales has agreed to hand over all auditing powers to the new National Regulator ensuring single standards are applied to all state providers. This ensures quality in the system; VET is one of the keys to increasing national workforce productivity and participation. A truly national approach to VET regulation will further increase the value of a VET qualification, increase worker mobility and assist in increasing national output. Once the national regulator assumes control of auditing, with all states deferring all their auditing powers, we can truly say that Ceretis Paribus applies to the VET system to all our benefit.