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Apprentice & Trainee commencements decline in first months of COVID-19

March commencements down 11%

Data from the first quarter of 2020 (January to March) has been released by NCVER, showing an 11.0% decline in Australian Apprenticeship commencements compared with the same quarter in 2019. This decline was expected due to the initial effects of COVID-19 during March, causing a decline in employers taking on new staff.

When looking at data for the 12 months until March 2020, compared with the year to March 2019, we see a decline of 7.7% in commencements. When the June 2020 data is released in November, we would anticipate an even steeper drop in commencement numbers due the the extreme effects of COVID-19 during that quarter.

Industry changes

Breaking down these numbers further, we see quite large differences in which industries have been hardest hit in terms of commencements. Trade commencements declined 9.8% in the March quarter, with non-trade commencements down 12.4%.

As would be expected, Aviation commencements we very significantly reduced compared to the previous year (53.2% decline), as were Tourism, Travel and Hospitality (21.2% decline) and Retail Services (29.2% decline). Other industries with large drops in commencements include Hairdressing and Beauty Services (11.8% decline), Business Services (10.8% decline) and Trainsport and Logistics (39.2% decline).

Some industries did see increases in commencements during the March 2020 quarter, with both Health (4.3% increase) and Community Services (3.6% increase) showing modest improvements. These industries have been pivotal to Australia's COVID-19 response, although it is too early to determine if this was the main reason for these improvements.

Cancellations and withdrawals

Cancellations and withdrawals declined by 6.1% in the March quarter compared with 2019. The Supporting Apprentices and Trainees Wage Subsidy and JobKeeper payments may have impacted on these figures, but it is likely that the full extent of cancellations won't be understood until after these support measures have ceased.

For those apprentices and trainees who have been cancelled, the NAEN Re-engagement Register can help them find a new position and recommence their apprenticeship.

Cancellation rates, as well as suspensions and recommencements, will show a more complete picture of how the Australian Apprenticeships industry has fared through COVID-19. As the current data release only includes the initial stages of COVID-19, future data releases will give more information on these issues.

Historical trends

COVID-19 has undoubtedly affected Australian Apprenticeship commencements, however these figures were already declining year on year prior to the pandemic. 2019 financial year commencements were the lowest in over two decades, and 2020 is shaping up to be much lower.

While the Australian Apprenticeships industry and governments consider ways to recover apprenticeship numbers from COVID-19, it is important to aim higher than simply returning to 2019 levels. 

Role of employers

Employers are a key component of the Australian Apprenticeships model; without an employer willing to take on an apprentice or trainee there can't be a commencement. As the economy recovers post-COVID-19, commencement numbers will be driven by employers deciding to commit to Australian Apprenticeships to hire staff.

New NCVER research also highlights the vital role that employers play in the completion of apprentices, particularly those in the traditional trade areas. This report shows that most apprentices who do not complete report employment related reasons for withdrawing. These include not getting on with their boss or colleagues, not liking the work, poor working conditions, and poor pay.

While comparing 2010 and 2019 data, the NCVER researchers note the large change in apprentices reporting "I lost my job/was made redundant" with this accounting for 26.9% of apprentices who didn't complete in 2010, versus only 1.9% in 2019. This was attributed to the Global Financial Crisis (GFC) having an impact for the 2010 survey, but not for 2019. If this survey was undertaken again after 2020, it is likely that many apprentice would again be reporting that they lost their job, this time due to COVID-19 rather than the GFC.

The role of employers in commencing new apprentices and helping them complete is clear, and employers need to be assisted in accessing the information, resources and support needed to take on Australian Apprentices. AATIS is currently running a research project examining the types of information employers need when making a decision to take on an apprentice or trainee. You can complete the stakeholder survey here.

Resources

For more information on Apprentice and Trainee statistics, take a look at these NCVER resources: