Australia’s manufacturing industry is at a crossroads.  After years of decline, the sector has finally found a more stable economic footing, and many indicators point to an expansion in domestic  manufacturing in the coming years.  Manufacturing added almost 50,000 new jobs in the last year – making it one of the most important sources of new work in the whole economy.

However, one key factor that could hold back that continuing recovery is the inability of Australia’s present vocational education and training system, damaged by years of underfunding and failed policy experimentation, to meet the needs of manufacturing for highly-skilled workers.  The skills challenge facing manufacturing is all the more acute because of the transformation of the sector toward more specialised and disaggregated advanced manufacturing  processes.  This naturally implies greater demand for highly-trained workers, in all its occupations: production workers, licensed trades, technology specialists, and managers.

To sustain the emerging turnaround in manufacturing, the sector has an urgent need for a concerted and cooperative effort to strengthen vocational education and training. This report contributes to that process: by cataloguing the emerging skills challenges facing manufacturing, reviewing the failures of the existing approach to vocational education in this sector (and across Australia’s economy as a whole), and proposing twelve key principles for reform.

This report, by Dr. Tanya Carney and Dr. Jim Stanford, was prepared by the Centre for Future Work for the Second Annual National Manufacturing Summit.  The Summit, held at Parliament House on 26 June 2018, will gather leading representatives from all major stakeholders in Australia’s manufacturing sector: business, unions, universities, the financial sector, suppliers and government. They will consider the industry’s prospects and identify promising, pragmatic policy measures to support a sustained industrial turnaround.  It is a highly appropriate forum at which to begin a discussion about multi-partite efforts to rebuild vocational education and address the looming skills challenges facing manufacturing.