Australia’s construction industry is facing a genuine labour shortage at the same time as its apprenticeship pipeline has weakened. That is not a contradiction. It is the predictable result of a system in which the social value of apprenticeships is high, but the private costs and risks to individual employers are immediate and often poorly shared. Construction remains a large employer, with about 1.37 million workers, and skills shortages remain concentrated in the trades. Jobs and Skills Australia has reported that shortages persist across key construction occupations, that nearly half of trade roles were still in shortage in the 2025 Occupation Shortage List, and that insufficient qualified applicants remains the leading shortage driver in sectors including construction. Yet apprenticeship contracts in training fell in the year to June 2025, and trade commencements fell sharply, including among construction trades workers.

The deeper problem is structural. Apprenticeships ask small and medium construction firms to absorb supervision costs, productivity losses, administrative effort, and retention risk over several years, while competitors can poach newly qualified workers or recruit already skilled labour. NCVER’s long-running research shows that supervision is a major cost to employers, that employer size strongly affects outcomes, and that group training arrangements tend to outperform direct small and medium employers on completion. At the same time, the recent evaluation of Australia’s COVID-era wage subsidies suggests that subsidies can lift commencements quickly, but do not automatically improve retention and can create deadweight or poor-quality starts if poorly designed.

Apprentice attrition is also more a workplace problem than a classroom problem. NCVER’s most recent outcomes survey found that for trade apprentices and trainees, the leading reason for non-completion was dissatisfaction with pay, working conditions or the workplace. Earlier NCVER studies found that many non-completers felt like cheap labour, some reported bullying, and structured training quality was sometimes poor or absent. Off-the-job training still matters, but the dominant risk remains weak supervision, poor culture, unstable work, and low early-stage earnings.

The most cost-effective way to rebuild the training pipeline is not to rely mainly on broad taxpayer-funded subsidies. OECD evidence cautions that universal incentives usually have only marginal effects, while levy-funded and sectoral models can correct the free-rider problem by making firms that benefit from the trained labour pool contribute to its creation. International and Australian construction-specific examples already exist: the United Kingdom’s CITB levy-grant model, Denmark’s employer reimbursement scheme, Singapore’s payroll levy for workforce upgrading, and Western Australia’s construction training levy. The strongest reform direction for Australia is therefore a hybrid model: a permanent, industry-governed construction training fund financed mainly by industry levies, complemented by tightly targeted public funding for equity cohorts, regional access, and system-wide public goods such as technical RTO capability, migrant bridging, and quality assurance.

Construction is migrant-reliant, but it is not unusually dependent on recent migrants relative to the wider labour market. When firms can substitute toward experienced migrant workers, temporary skilled visas, subcontracting and under-recognised overseas-qualified workers, the immediate employer incentive to train novices weakens.

From guilds to modern apprenticeships

Apprenticeship is one of the oldest labour-market institutions in recorded history. It traces its roots to ancient craft transmission in Egypt and Babylon, including the Code of Hammurabi, and then to Roman collegia. By the thirteenth century, apprenticeship had become central to western European craft guilds, where masters supervised quality, work methods and entry to the trade, and apprenticeship commonly lasted seven years. The English Statute of Artificers of 1563 tried to regulate conditions and curb exclusionary guild practices, helping to formalise the legal relationship between master and apprentice.

The Industrial Revolution changed apprenticeship rather than eliminating it. Mechanised production increased demand for both skilled and semi-skilled labour, while trade unions and later public vocational institutions helped preserve or reshape apprenticeship for modern industry. Postwar systems in countries such as Germany and France moved toward more formalised combinations of workplace training, school attendance, and public regulation. Modern Australian apprenticeships sit in that historical lineage: they are still based on the same essential bargain of paid work combined with structured learning, but they now depend on a more complex triangle of employers, training providers and government.

That long history matters because it clarifies what an apprenticeship is really for. Apprenticeships do not exist simply to meet a short-term vacancy. They exist to reproduce a skilled occupational labour force over time. When employers, governments or training providers start treating them as just another subsidy program, or as cheap labour for immediate production, the institution begins to fail. NCVER’s research on non-completion repeatedly points to this tension: apprentices stay when the relationship actually functions as training; they leave when it feels like ordinary low-paid labour with weak support and uncertain progression.

Why apprenticeships are shrinking despite labour shortages

The first reason is that labour shortages do not automatically make training attractive to employers. Jobs and Skills Australia’s shortage analysis shows that construction shortages are primarily driven by too few qualified applicants, not by an absence of vacancies. That means employers need skilled labour now, whereas apprenticeships produce skilled labour only after several years. In practice, firms respond to urgent shortages by jacking up wages, using subcontractors (known in the industry as 'working on an ABN'), stretching existing staff, deploying informal training, or seeking migration pathways. In March 2026, JSA still found that Skill Level 3 roles remained the hardest to fill, with a fill rate around 55.5 per cent, confirming that trades shortages can persist even as broader labour-market conditions soften.

The second reason is fragmentation. Construction is dominated by small and medium enterprises, short project cycles, subcontracting chains and uneven workloads. NCVER’s employer and completion research shows that smaller and less experienced employers have weaker completion outcomes, while group training organisations can improve results because they centralise recruitment, pastoral care, compliance and placement management. This is exactly what a fragmented industry struggles to do on its own.

The third reason is that many employers prefer lower-commitment training options. NCVER’s 2025 employer survey found that 79.0 per cent of employers used informal training, 50.9 per cent used unaccredited training, 57.0 per cent used accredited training, but only 28.7 per cent reported having apprentices or trainees. Among employers that provided no training, the top reasons were that current employees were already adequately trained or that training was not relevant. In other words, apprenticeships are no longer the default method by which Australian employers build capability; they are one option beside many easier, shorter and more controllable alternatives.

The fourth reason is employer cost and risk. NCVER’s cost study in the plumbing and electrical trades found that the highest employer costs are supervision costs, and that wages are broadly offset by apprentice productivity. In other words, the problem is not simply “apprentices are paid too much”; it is that experienced tradespeople must slow down and teach, which is hard to absorb in a project-driven environment with thin margins. Older apprenticeships are especially difficult to finance unless the post-qualification wage premium is substantial.

The fifth reason is that subsidies have been episodic and often too commencement-focused. The recent evaluation of the Boosting Apprenticeship Commencements and Completing Apprenticeship Commencements programs found that the wage subsidies generated a very large increase in commencements, with the BAC lifting starts by about 70 per cent, but they did not materially improve retention and may have slightly increased cancellations in some segments. Employers valued front-loaded payments because first-year apprentices are least productive, but the study also identified “sharp practice” and training-system strain. That matters because it implies that temporary wage subsidies can pull commencements forward without solving the deeper quality and retention problems.

Recent policy settings themselves acknowledge this design problem. DEWR’s 2026 apprenticeship incentive materials show that support has been increasingly concentrated on housing construction and clean-energy priority occupations and that, from January 2027, assistance will focus more on apprentices and small to medium employers, with large employers excluded from some incentives. That is effectively a policy admission that broad, untargeted support gives too much money to employers who may have trained anyway and too little to those facing real financing and supervision constraints.

Why completion is so hard and why training often misses employer needs

Construction completion rates are not disastrous by historical standards, but they are still far below what a shortage economy needs. NCVER’s 2024 completion report found that for trade apprentices who started in 2018, the six-year completion rate was 58.2 per cent overall and 57.7 per cent for construction trade workers. That is an improvement, but it still means roughly four in ten do not complete within six years.

The most immediate driver of attrition is the employment relationship. NCVER’s 2025 outcomes survey found that the most common reason trade apprentices and trainees did not complete was dissatisfaction with pay, working conditions or the workplace, nominated by 27.7 per cent. Personal reasons came next at 19.8 per cent. Satisfaction data tell the same story: trade completers reported much higher satisfaction than non-completers, both with on-the-job learning and with off-the-job training. Earlier NCVER work found that non-completion commonly followed interpersonal conflict, poor bosses, redundancy, not liking the work, or a belief that they were being used as cheap labour.

Wages and living costs intensify the problem, especially early in the apprenticeship and for mature-age entrants. The old but still relevant NCVER employer-cost research argued that apprenticeships are inherently more attractive to younger workers than to older workers unless qualified wages are high enough to compensate for the earnings sacrifice during training. That logic has only become sharper in a high-rent, high-cost environment. The apprenticeship model still expects learners to absorb several years of relatively low earnings while producing real labour for the employer.

TAFE and other off-the-job training providers are not the main reason apprentices leave, but alignment problems are real. NCVER’s 2025 employer survey reports that when employers are dissatisfied with accredited training or apprenticeships, the main reasons are poor quality or low standard, or that relevant skills were not taught. Earlier NCVER employer research described long-running complaints that training is too general, insufficiently practical and sometimes delivered using outdated equipment or methods. These are not necessarily complaints about TAFE alone; they are complaints about the architecture of VET provision across TAFE and private RTOs. But because TAFE is the main provider for many apprentices, TAFE sits at the centre of the issue.

Part of the misalignment is built into the system. Skills Insight and ASQA both emphasise that training packages specify industry competencies, not the curriculum or pedagogy. RTOs must decide how to deliver, sequence and contextualise training. That provides flexibility, but it also means outcomes vary with provider capability, local equipment, industry engagement, teacher currency and elective availability. Government consultation material has also noted that because it is not financially viable for providers to run every elective, delivery can become more generic than industry wants. In thin regional markets, that problem is even worse.

The VET workforce itself is another constraint. Productivity Commission reporting shows that the VET workforce is ageing, that VET teachers declined sharply between 2011-12 and 2017-18 before only a slight recovery, and that job advertisements for VET teachers doubled over the decade to January 2024. The average age of the VET workforce was 47.3 in 2021 and almost half were aged 50 and over. That makes it harder to maintain industry currency in fast-moving construction methods and technologies, particularly when tradespeople can often earn more on site than in teaching.

NCVER reports that 59.1 per cent of employers with apprentices and trainees used TAFE institutes as their main training provider in 2025, often because TAFE was the only suitable provider, because course content was appropriate, or because of location and access. TAFE is essential, but it cannot align perfectly with employer need when teacher shortages, equipment costs, thin regional markets, variable provider quality, and a competency-based package model all push toward standardisation rather than deep contextual tailoring.

What international funding models show

With apprenticeship rates plummeting there have been many calls for increased employer incentives. This is essentially more tax payer 'welfare' for business. It is not economically sustainable or responsible.

The international evidence points to a clear financing lesson. OECD analysis warns that universal cash incentives for employers are usually weak instruments because they mostly pay employers who would have trained anyway. By contrast, levy-funded schemes can address the free-rider problem by requiring firms that benefit from the skilled labour pool, including firms that poach, to contribute to apprenticeship costs. The OECD also notes that sectoral levies usually attract stronger employer support than broad national levies because employers can see the connection between their contribution and their industry’s workforce needs.

The United Kingdom’s construction system is the most relevant international example. CITB is legally required to raise a levy from construction businesses to fund skills and training. CITB says the levy enabled it to invest £296 million in skills and training in the previous year and to provide nearly £130 million in grant support to registered employers. CEDEFOP describes the model as a sectoral training fund aimed at ensuring firms that benefit from construction skills also fund the pipeline. Whatever one thinks of the UK’s wider apprenticeship policy, the construction-specific levy solves a core problem that Australia still leaves mostly to general taxation and voluntary employer effort.

Denmark uses another useful model. Its AUB system is an employer reimbursement scheme under which employers contribute collectively and firms with trainees can claim reimbursements when trainees attend school. CEDEFOP notes that the Danish system shares costs across employers and supports school-based periods, while the official Danish business portal confirms that employers with trainees can claim reimbursement and that the scheme is funded through mandatory employer contributions. This is a smart answer to one of the real employer pain points in apprenticeships: paying wages when the apprentice is off the tools and in formal training.

Singapore provides a broader skills funding example rather than a construction-specific one. Its Skills Development Levy is a compulsory employer levy on all employees, including foreign employees, at 0.25 per cent of monthly wages subject to minimum and maximum payments. The levy funds workforce upgrading and training grants through the Skills Development Fund. This is useful because it shows how a system can make all firms, including firms reliant on migrant labour, contribute to training. But because it is economy-wide rather than construction-specific, it is less tightly aligned to the particular labour-market failures in construction trades.

Australia already has domestic prototypes for a better construction funding model. Western Australia’s Construction Training Fund levy is charged at 0.2 per cent of construction project value and the revenue is invested back into industry training, apprentice support, research and careers promotion. The WA Government explicitly states that the levy exists to help maintain productivity and a supply of skilled workers. This is probably the strongest evidence that a construction-levy model is institutionally feasible in Australia and does not need to be invented from scratch.

On the evidence available, the most cost-effective model for Australia is therefore a hybrid. The main funding source should come from a permanent, industry-financed construction training fund, ideally through a sector-specific levy on project value or payroll, with credits or rebates for firms that genuinely train. Taxpayer funding should not disappear, but it should be reserved for areas where there is a strong public-interest case: support for disadvantaged apprentices, regional delivery, pre-apprenticeships, TAFE and teacher capability, robust quality assurance, and recognition/gap training for experienced but unqualified workers and migrants. That conclusion is partly inferential, but it follows directly from OECD’s caution about universal incentives and from the practical design of CITB, Denmark’s AUB, Singapore’s SDL and WA’s CTF.

Migration, migrant communities and the apprenticeship pipeline

Migration and apprenticeships are linked in two ways. The first link is substitution. When an employer can source a partly or fully trained worker through skilled migration, local poaching, or a subcontracting chain, the business case for taking on a first-year apprentice weakens. The second link is complementarity. Skilled migration can act as a bridge while the domestic training pipeline rebuilds, especially when shortages are immediate and severe. Industry bodies such as the National Painting and Decorating Institute have explicitly made that argument, saying that migration is needed while apprenticeship reforms take effect.

Current visa rules reinforce that diagnosis. The Skills in Demand visa requires a nominated occupation on the Core Skills Occupation List and at least one year of relevant work experience. The Student visa normally limits work to 48 hours a fortnight while study is in session. The Training visa is explicitly not for ongoing work and is designed for structured workplace training. The Temporary Graduate Post-Vocational Education Work stream gives eligible graduates of Australian diploma or trade qualifications temporary full work rights, usually for 18 months, provided their qualification and skills assessment align with an occupation Australia needs. These settings create some pathways into the trades, but they are piecemeal. They do not yet amount to a coherent “study a trade in Australia, work lawfully in the industry, build supervised experience, then progress to sponsorship or licensing” pathway.

The ILO has documented apprenticeship systems and reforms across Asia and the Pacific, and UNESCO-UNEVOC works specifically on TVET strengthening, including migrant and refugee inclusion in the Arab States. Different countries have different VET and apprenticeship forms, and migrants may arrive with systems, terminology and status hierarchies that do not map neatly onto Australian apprenticeship structures.

That has practical implications for awareness-building in migrant communities. Australia already has official apprenticeship information, support providers, and workplace-rights material. Apprenticeships Victoria also explicitly identifies culturally and linguistically diverse communities as a target cohort. The right policy response is therefore not to lecture migrant communities about “Australian culture”, but to communicate plainly in community settings that apprenticeships are paid work plus nationally recognised qualifications, that there is financial support available in priority occupations, and that apprentices and migrant workers have enforceable workplace rights.

The most promising awareness methods would be multilingual and community-anchored: campaigns through settlement services, ethnic media, schools, places of worship, community associations and local councils; trade-career ambassadors from migrant backgrounds; translated guides on pay, progression and rights; and family-oriented outreach that explains how Australian trades can lead to stable earnings, small business ownership and licensed occupational status. That recommendation is partly an inference, but it is consistent with the official support infrastructure that already exists and with the wider TVET inclusion agenda documented by UNESCO-UNEVOC.

Using international construction students as a genuine workforce pipeline

Australia currently treats most international VET students primarily as students who may work, rather than as developing trades workers whose education should be integrated with sustained industry employment. A redesigned model could create a new stream of workers by requiring international students enrolled in construction-trade qualifications to secure relevant, lawful employment and complete substantially more verified workplace experience.

The key policy change would be to make industry participation an essential part of the course, not an optional activity undertaken separately from training.

How the model could work

An international student studying painting, carpentry, solid plastering, tiling or another construction trade could be required to:

• obtain employment with an approved construction employer within an initial period, such as three to six months;
• work a minimum number of paid industry hours each semester;
• complete a structured workplace training plan linked to the units of competency;
• have workplace evidence verified jointly by the employer and RTO;
• remain with an approved employer or transfer through a managed placement service; and
• accumulate perhaps 1,500–2,500 hours of relevant employment before receiving the full trade qualification.

This would require changes to course registration, CRICOS delivery arrangements and potentially student-visa work settings. Providers delivering to overseas students must comply with the ESOS framework and the National Code, which establishes nationally consistent standards for overseas-student education. Any new employment requirement would therefore need to be built transparently into the registered course, student agreement and assessment model.

Why this would produce additional workers

Students would enter the industry early

Under the present model, an international student may complete substantial classroom or simulated training without developing a stable relationship with a construction employer. Some students work in unrelated sectors because those jobs are easier to obtain or offer predictable hours.

A mandatory industry-employment model would redirect that available labour into construction from the beginning of the course. Instead of waiting until graduation to seek trade work, students would contribute as:

• trade assistants;
• supervised trainees;
• apprentices or apprentice-equivalent workers;
• materials handlers;
• preparation workers; and
• junior construction workers performing tasks within their demonstrated competence.

Even before becoming fully qualified, they would increase productive workforce capacity.

Employers would gain a recruitment channel

Small construction businesses frequently struggle to find suitable apprentices and may be reluctant to recruit an unknown worker for a traditional four-year commitment.

A structured international-student pathway could give employers access to candidates who have:

• undergone initial safety and practical training;
• demonstrated English-language ability;
• been screened by a registered provider;
• committed to a construction occupation;
• received ongoing training support; and
• entered a formal placement and monitoring arrangement.

The RTO or an industry group training organisation could perform much of the recruitment, matching and administration. This would reduce employer risk and make participation more attractive to smaller firms.

More experience would improve job readiness

Australian trade qualifications are competency based, but the amount and variety of real workplace exposure can differ considerably between learners. Simulated training is useful, but it cannot fully reproduce:

• changing site conditions;
• production deadlines;
• interaction with other trades;
• customer expectations;
• weather constraints;
• quality defects;
• rework;
• commercial productivity requirements; and
• responsibility for completed work.

Increasing the required workplace component would produce graduates who are more useful immediately after qualification. Employers would be more likely to retain them because the workers would already understand Australian sites, terminology, safety systems and standards.

The United Kingdom's City & Guilds Qualification Framework: Lessons for Australia

One of the most interesting international comparisons for Australian construction training is the United Kingdom's City & Guilds vocational qualification system. Although qualifications are now regulated within the Regulated Qualifications Framework (RQF), City & Guilds remains the UK's largest vocational awarding organisation and has trained construction workers for more than 140 years. The system offers a progressive pathway that is often more flexible than Australia's apprenticeship model and provides multiple entry and exit points into the construction industry.

Historical development

City & Guilds was established in 1878 by the City of London Corporation and the Livery Companies to address the shortage of skilled tradespeople following the Industrial Revolution. Rather than relying solely on traditional guild apprenticeships, it created nationally recognised vocational qualifications that employers across Britain could trust.

Today, City & Guilds qualifications are recognised throughout the UK construction industry and are delivered by colleges, private training providers and employers.

---

The three-stage qualification system

Unlike Australia, where most construction trades effectively begin with a Certificate III apprenticeship, the UK system is divided into three progressive stages.

Rather than requiring every student to commit immediately to a four-year apprenticeship, learners can gradually progress through increasingly demanding qualifications.

---

Level 1 – Preparing people for the trades

Level 1 qualifications are designed for people with little or no industry experience.

Typical units include:

• workplace health and safety
• construction mathematics
• measuring and setting out
• hand tools
• power tools
• materials identification
• teamwork
• communication
• introduction to painting, plastering, carpentry or bricklaying.

Importantly, Level 1 students usually spend much of their time in practical workshops learning fundamental trade skills before entering employment.

Benefits

Level 1 reduces one of Australia's biggest problems. Australian employers often say: "I don't have time to teach someone how to use a tape measure."

Level 1 means employers receive workers who already possess basic trade competencies.

---

Level 2 – Occupational competence

Level 2 begins developing genuine occupational skills.

For painters this includes:

• surface preparation
• sanding
• filling
• brush application
• roller application
• spray painting
• wallpapering
• colour matching
• safe use of access equipment.

Much of Level 2 can be completed while working.

Employers can recruit Level 2 students because they already possess practical capability.

This reduces supervision requirements and improves productivity.

---

Level 3 – Qualified tradesperson

Level 3 represents full occupational competence.

Students demonstrate:

• advanced trade techniques
• estimating
• planning
• quality assurance
• decorative finishes
• specialist coatings
• customer service
• supervising others
• solving technical problems.

Completion generally satisfies the requirements to be recognised as a qualified tradesperson.

---

Why this system works

One of the biggest strengths of the UK system is that students can exit and re-enter education. There is no requirement to complete a four-year apprenticeship in one continuous period. Workers can study when it suits their circumstances.

---

Comparison with Australia

Australia's pathway is much more linear. If an apprentice leaves after two years, they often receive no qualification that employers recognise as evidence of occupational competence. This contributes to high attrition. Someone who has completed 70% of an apprenticeship may still be regarded as "not qualified."

---

Advantages of the UK model

1. Lower employer risk

Australian employers must usually commit to:

• four years
• increasing apprentice wages
• supervision
• release for training
• administrative requirements.

The UK allows employers to recruit workers who have already completed Level 1 or Level 2, reducing both training costs and risk.

---

2. Better preparation before employment

Australian TAFEs often begin practical training after an apprentice has already started work.

The UK reverses this. Students first develop practical competence before employers invest in them.

Consequently:

• fewer early mistakes
• greater confidence
• higher productivity
• less supervision.

---

3. Multiple exit points

This is one of the UK's greatest strengths. A student leaving after Level 2 still holds a nationally recognised qualification. Australia generally offers no equivalent recognition for partially completed apprenticeships.

---

4. Greater flexibility

Workers can:

• study full-time
• study part-time
• work then return
• complete units over many years.

Australia's apprenticeship contracts are considerably less flexible.

---

Limitations of Australia's AQF

Australia's Australian Qualifications Framework (AQF) is internationally respected, but for construction trades it has several structural weaknesses.

1. Certificate III is effectively the starting point

Most trade qualifications begin at Certificate III.

There is relatively little use of:

• Certificate I
• Certificate II

despite these qualifications being available.

This means many beginners enter workplaces with limited practical experience.

---

2. Heavy reliance on employers

Australia expects employers to provide much of the practical training.

This creates problems because:

• many construction businesses employ fewer than five people
• supervisors are under production pressure
• small firms often cannot justify the investment.

The UK places greater responsibility on colleges for early-stage skill development.

---

Could Australia adopt a similar system?

A possible Australian model might look like this:

This would allow prospective apprentices to demonstrate genuine capability before asking employers to invest in a multi-year apprenticeship.

---

Potential benefits for migrant workers

A staged qualification system could also help migrants entering Australia's construction industry.

Many migrants arrive with practical skills but no Australian qualification. A modular pathway would let them:

• complete a short bridging program covering Australian WHS requirements, building regulations and workplace practices;
• gain recognition for existing skills through recognition of prior learning (RPL);
• enter at an appropriate qualification level rather than starting from the beginning; and
• progress to full trade recognition while employed.

This could be particularly valuable for migrants from countries where vocational education is primarily school-based or where apprenticeship systems differ substantially from Australia's.

---

Implications for Australia

The City & Guilds model demonstrates that vocational education does not have to be an "all-or-nothing" apprenticeship. Progressive qualifications allow learners to build recognised skills over time while giving employers greater confidence in the capabilities of new recruits.

For Australia, adopting more meaningful use of Certificate I and II qualifications, strengthening recognition of intermediate achievements, and expanding pre-employment practical training could reduce employer risk, improve apprentice retention and create clearer pathways for both school leavers and skilled migrants. These reforms would complement, rather than replace, the AQF and traditional apprenticeship system while making it more responsive to the needs of a modern construction workforce.

A cost-effective reform package for Australia

The first reform should be financial architecture, not just another temporary subsidy. Australia should establish a national construction training fund, modelled more on WA’s CTF and the UK’s CITB than on short-lived budget measures. A low levy on construction project value or a sector payroll base would spread costs across the firms that benefit from the labour pool, including firms that currently train little or not at all. Credits, rebates and grants should then flow back to firms that employ apprentices, to group training organisations, and to providers delivering high-quality recognition-of-prior-learning and gap training. This would reduce the burden on general taxpayers while correcting the free-rider problem identified by the OECD.

The second reform should be to move from commencement-heavy incentives to completion-heavy incentives. Australia’s recent policy already points in that direction, with stage-based and priority occupation support under the apprenticeship incentive system. That shift should go further. Employers should receive part of their subsidy only at key retention and completion milestones, and apprentices themselves should get stronger income support in the first two years, when drop-out risk is highest and wages are lowest. This would target the real leakage point rather than overpaying for starts alone.

The third reform should be to scale up shared-employer and rotational models. NCVER’s evidence that group training organisations outperform small and medium direct employers is one of the clearest actionable findings in the whole apprenticeship literature. In a project-based industry, a portable apprenticeship model makes sense: one employing entity, multiple host sites, guaranteed training oversight, and continuity when one project ends. Construction is exactly the sector where that institutional form has the greatest payoff.

The fourth reform should target the TAFE-employer interface. They should be tied to local industry compacts that involve employers, unions, TAFEs and Jobs and Skills Councils, with explicit goals around teacher secondments from industry, equipment modernisation, course scheduling aligned with construction work patterns, and rapid feedback loops when employers identify repeated skill gaps. We need reform of the construction package for the construction industry to make it more relevant for the industry of today and the future. The UK Model serves as a good example of the direction we need to go in.

BuildSkills Australia's Residential Construction Mobility Study recently identified the need to 'Upgrade experienced workers into qualified workers through a national skills assessment and gap training framework'. We believe such a framework already exists but is often not funded. In most states RPL and gap training are not funded. It is only funded in QLD by CSQ and in NSW by the state government. In every other state there is no funding for RPL or gap training.

The fifth reform should be a better migration pathway for trade learners. Australia already allows some temporary residents to undertake apprenticeships in particular circumstances, and it gives post-vocational trade graduates a temporary work right through the 485 visa. But the pathway is still fragmented. A better model would allow prospective workers in priority construction trades to study an Australian trade qualification, complete supervised on-the-job experience with stronger work rights than a standard student visa allows, and move more smoothly into sponsorship or permanent regional pathways when they meet licensing, English and competency standards. Structured workplace experience gained through an apprenticeship or formal industry placement is already recognised in some Home Affairs rules as relevant experience; policy should build on that logic rather than forcing learners through disconnected visa stages. This recommendation is cost neutral to the Australian economy and government budgets because migrants pay for their own training.

Taken together, those reforms would lower the burden on taxpayers, improve completion, reduce the incentive for firms to free-ride, lift the quality and responsiveness of off-the-job training, and make migration a complement to domestic training instead of a perceived substitute for it. They would also align Australia closer to what the Productivity Commission has recently argued more broadly: financial incentives work best when they are targeted, advisory support matters, and low training rates in small and medium businesses are a national productivity problem, not just an education issue.

Author: Daniel Wurm is Managing Director of the National Painting and Decorating Institute, Australia's peak professional body for the painting industry. He holds a Diploma in Vocational Education and Training, and a Diploma in Business. He has 32 years experience in the construction industry, as a trades person and business owner, and 14 years as a senior VET professional.

Citations

Australian Bureau of Statistics. (2025). Labour force, Australia, detailed (Catalogue No. 6291.0.55.004). https://www.abs.gov.au/statistics/labour/employment-and-unemployment/labour-force-australia-detailed

Australian Government Department of Education. (2025). Education Services for Overseas Students (ESOS) Framework. https://www.education.gov.au/esos-framework

Australian Government Department of Home Affairs. (2025). Migration and visa statistics. https://www.homeaffairs.gov.au

Australian Industry Group. (2024). Workforce development and skills reports. https://www.aigroup.com.au

Australian Qualifications Framework Council. (2013). Australian Qualifications Framework (2nd ed.). https://www.aqf.edu.au

City & Guilds. (2025). Construction qualifications. https://www.cityandguilds.com

European Centre for the Development of Vocational Training. (2023). Vocational education and training in Europe. https://www.cedefop.europa.eu

Federal Institute for Vocational Education and Training. (2025). Vocational education and training in Germany. https://www.bibb.de

Fair Work Ombudsman. (2025). Pay and conditions. https://www.fairwork.gov.au

Government of Canada. (2025). Red Seal Program. https://www.red-seal.ca

Housing Industry Association. (2025). Economic and industry forecasts. https://hia.com.au

Institute for Apprenticeships and Technical Education. (2025). Occupational standards and apprenticeships. https://www.instituteforapprenticeships.org

Jobs and Skills Australia. (2025). Occupation Shortage List. https://www.jobsandskills.gov.au/data/occupation-shortages-analysis/occupation-shortage-list

Master Builders Australia. (2024). Building and construction industry research. https://masterbuilders.com.au

National Centre for Vocational Education Research. (2024). Historical time series of apprenticeships and traineeships in Australia (1963–2024). https://www.ncver.edu.au/research-and-statistics/data/all-data/historical-time-series-of-apprenticeships-and-traineeships-in-australia-from-1963-to-2024

National Centre for Vocational Education Research. (2024). Apprentices and trainees 2024: December quarter. https://www.ncver.edu.au/research-and-statistics/publications/all-publications/apprentices-and-trainees-2024-december-quarter

Organisation for Economic Co-operation and Development. (2024). Education at a glance 2024: OECD indicators. OECD Publishing. https://www.oecd.org/education/education-at-a-glance

Productivity Commission. (2020). National Agreement for Skills and Workforce Development Review. https://www.pc.gov.au

Standards Australia. (2025). Australian Standards. https://www.standards.org.au

State Secretariat for Education, Research and Innovation. (2024). Vocational and professional education and training in Switzerland. https://www.sbfi.admin.ch

UK Department for Education. (2024). Apprenticeships and technical education. https://www.gov.uk/government/organisations/department-for-education

Comments

Leave a comment

Name

Email

Comment