Pandemic impact on apprenticeships: NCVER data

In an NCVER report released in August 2021, the impact of COVID-19 on apprenticeships has revealed an interesting and ultimately positive story. We summarise the report’s findings here.

Apprentice commencements
During the first half of 2020, commencements were weak reflecting a decades-long decline in commencement numbers. Numbers dipped further as Australia came to grips with the rising infection rate and intensified lockdown restrictions. Moreover, the intensity of lockdowns and disruption attributable to the pandemic was varied across the nation. Victoria experienced a prolonged lockdown in the middle of the year while other states were relatively open.

However, in the second half of the year following the general budgetary stimulus measures and direct financial support for the VET sector (most notably the Boosting Apprenticeship Commencement wage subsidy), commencements rebounded strongly and produced a year on year increase, which will positively impact the medium-term supply of skilled occupations.

Other factors could have affected this strong result. One may be attributable to the lack of skilled migrants flowing into key areas of skill shortage, another may have resulted from the strong employment rebound as states emerged from lockdowns. Regardless, businesses have been incentivised to take on new local talent to plug skill gaps.

Apprentice suspensions
While commencements were weaker in the first half of 2020, contract suspensions painted a clearer picture of the disruption caused by the pandemic. There was a steep rise in contract suspensions in March, April and May. Another spike occurred in August as Victoria endured its lengthy second lockdown through the winter.

Encouragingly, few of those suspensions resulted in eventual cancellations of apprenticeship contracts. By the end of 2020 fewer apprentice contracts were cancelled than in 2019. Again, there may be various reasons for this but it is pleasing to note that businesses were generally intending to retain their contracts with apprentices even during the extreme uncertainties that COVID has created.

There are clear signs that businesses are responsive to subsidies that facilitate the development of apprentice and trainee pipelines. The commencements flowing through industry sectors over the past 12 months will take a number of years to yield qualified and experienced workers for which industry has desperately called. It is essential that this positive momentum is harnessed and funding continues to flow to support demand for local skill development and to support industry as it navigates towards a stronger, post-COVID-19 economy.