Education and skills are economic issues – July 2007

With WorkChoices and his abuse of the skilled-worker immigration scheme, John Howard is setting us on a low-skill, low-wage economic path. Labor`s alternative is a policy of increased investment in education.

There is a very vibrant debate going on in Australia at the moment – much of it initiated by the union movement – about industrial relations, the skills shortage, the use of s.457 and s.442 immigration visas and the under-investment in vocational and tertiary education.

What is interesting about this debate is the growing awareness that these issues are about the management of the economy and that their neglect will have a serious impact on our future prosperity.

In a federal election year this debate is also about a choice we have for our future: whether we adopt a high-skilled, high-wage route or whether we go down the path of a low-skilled, low-wage economy.

For the past 11 years our TAFEs and universities have been starved of funds and we are now reaping the harvest of that neglect with a severe and chronic skills shortage that can be seen across a wide spectrum of industries and sectors from mining to nursing.

The Australian Industry Group estimates that Australia will need 270,000 more skilled workers over the next ten years. Yet, incredibly, we have turned away over 300,000 people from our TAFEs since 1998 and nearly 150,000 people from our universities since 2001.

There has been a cut to our public investment in tertiary education of 7% (as a share of GDP) since 1995. It is a disgrace that we are the only country in the developed world that has cut funding to the tertiary education sector.

The consequences of this neglect are profound and dire:

  • the ACTU estimates that under-investment  in  traditional apprenticeships will have cost the Australian economy $9 billion by 2014;
  • Australia’s productivity has dropped alarmingly between 1998 and 2005;
  • predictions estimate a shortfall of 40,000 nurses nationally by 2010.

There is now an alternative policy direction

The Howard government is now being asked some searching questions about its track record in these areas and so it should be.

Even harder questions are being asked of the government about its plans for the future.

What we can deduce from its IR laws, its anti-union rhetoric and even its advertising is that we can expect more of the same.

When the neglect of tertiary education is seen in the context of WorkChoices and the flagrant abuse of the s.457 and s.442 skilled immigration visas (see story page 25) you need to consider if this will lead to a low-skill, low-wage economy.

After many years of dysfunction, Labor’s revival under Kevin Rudd has led to a more robust debate about the issues confronting Australia and is providing a genuine policy alternative to what we have had for the past 11 years.

Labor has flagged what it is calling a ‘third wave of economic reform’ that is centred on an increased investment in education, a commitment to a high-skilled workforce, a modernisation of the economy with the creation of a comprehensive, high-speed broadband network, and more money for infrastructure.

And, of course, it has promised to abolish WorkChoices.

A threat to our prosperity

This debate is of great relevance to nurses. A key reason for the nurse shortage is the neglect and under-investment in our universities. The enrolled nurse program in TAFE NSW is almost exclusively funded by NSW Health contracts.

The NSWNA has serious concerns about the way s.457 and s.442 visas are being used to bring in what is effectively cheap, unskilled labour under the guise of ‘a skilled immigration scheme’ that could undermine not only nurses’ current pay and conditions but the standards and quality of our health and aged care.

And we clearly believe that the federal government’s IR laws are intrinsically bad for nurses.

There is now a wealth of economic evidence that links the lack of investment in our TAFEs and universities with the skills shortage and a drop in productivity. This is a major threat to our future prosperity.

There will be a lot of talk about economic management in the lead-up to the federal election and these issues – investment in education and skills and how economic growth is redistributed through decent pay and conditions – must be core components of that debate.