Historically during economic downturns there has been a return to learning. When jobs were lost many chose to sit out the tough times by studying towards recognised qualifications, thereby, enhancing their chances of employment when conditions improved.
Four turbo-charged trends
Difficult economic conditions brought on by lockdowns and other restrictions are likely to similarly encourage a return to learning. There are, however, at least four important points of qualification. Each is more accurately regarded as an ‘amplification’ of a current trend, rather than a ‘difference’. That is, the current pandemic is turbo-charging changes already in motion, not triggering them.
Firstly, while many may find themselves unemployed, many more are finding themselves underemployed, thereby limiting their capacity to take on a fulltime study load. During the peak of the lockdowns, between March and May 2020, the rate of unemployment jumped up by almost two percentage points from 5.2 to 7.1%. Meanwhile, the underemployment rate increased by more than four percentage points from 8.8 to 13.1%. The latter is unprecedented, yet it occurs in the context where the gap between the two measures was already widening, particularly since 2014. Intriguingly, as labour market conditions have improved, the gap has narrowed sharply, suggesting that either people in employment have extended their hours and/or no longer desire to do so.
*Source: Australia Bureau of Statistics (ABS) (2020) Labour Force, Australia
The related second trend is that fewer are willing to take prolonged time out from their careers to study. A survey by Deloitte, albeit now a few years old, finds that Australia’s workers (aged 18 and over) favoured work-relevant, continuous, bite-sized learning that helps balance learning, working and other life priorities. A large 45% of study-interested workers preferred this approach to learning over longer periods of intensive study.
It is not a stretch to predict that, following lockdown, people who were either stood down or who took time out to manage household or other demands, will be keen to both enhance their employability and get back to work, particularly if they are concerned about job security. Short courses are an important means of balancing work and learning.
This is not the same as saying that there will be no demand for traditional qualifications. This may be the path chosen by some who find themselves unemployed and struggling to find work. And there may indeed be a spike in demand from school leavers if they are not optimistic about finding a job or if a gap year abroad is off the cards.
Online learning is the other important means that provides flexibility to balance work and learning. During lockdown, it was the only means. This is the third of the trends referred to earlier that have accelerated in the wake of the crisis.
Again, this reflects an evolution in preferences already in play. The same Deloitte survey also found that 78% of study-interested workers preferred at least half of their learning content to be delivered online; 62% preferred more online delivery than in-person delivery. Data from the United States is that demand for online post compulsory education increased by 7% as the pandemic took a toll.
Driving preferences for both bite-sized learning and online delivery is not just flexibility, but economics. Discipline-specific skills have ever-decreasing shelf lives given the rapidly evolving future of work, necessitating continuous development to remain relevant and employable. That is, for those seeking to remain part of the job market, there is a need to embrace “lifelong learning”.
This is particularly so given the rapidity of job births, deaths and transformations. In its report on the Future of Jobs, written in the midst of the pandemic, the World Economic Forum (WEF) found that, while COVID-19 accelerated the rate of job destruction, losses will be surpassed by ‘jobs of tomorrow’ created.
In this context, it is not optimal to take frequent and long breaks to study on campus to acquire new qualifications. It may make few dollars and little sense, if those qualifications are redundant before completion. During difficult economic times, when household finances are tight or uncertain, the imperative is particularly acute.
Transferrable skills have longer shelf lives and are what are in greatest demand from employers. In the previously referenced report on the Future of Jobs, the WEF finds that the pace of technology adoption, in tandem with the COVID-19 recession, is creating a ‘double-disruption’ scenario for workers. In addition to the disruption from the pandemic-induced lockdowns and economic contraction, technological adoption by companies is transforming tasks, jobs and skills.
While the ability to design, program and use technology make the WEF’s top 15 list of skills that surveyed business leaders from around the globe are predicting will be in demand in 2025, they do not make the top five. The top five skills are: analytical thinking and innovation; active learning and learning strategies; complex problem-solving; critical thinking and analysis; and creativity, originality and initiative.
This list will be unsurprising as these skills have been journeying to the tops of similar lists in recent times. What the double disruption has done is hasten their elevation and prominence. Despite the omnipresence of technology, the future of work has never been more human. This is the fourth of our four trends. The challenge for workers, employers and educators alike is how to signal and recognise the transferrable skills this future demands.
Post-compulsory education is remaking itself
Over recent years, painting the optimal future of post-compulsory education has sparked the imaginations of many academic, expert and business commentators. In 2008, there was, what became known in education circles as, the Bradley Review, which argued that “[W]hat is needed is not two sectors configured as at present, but a continuum of tertiary skills provision”. In 2014, the Mitchell Institute called for a reconceptualisation of tertiary education, where there is “a more coherent tertiary system”. In 2018, KPMG reimagined tertiary education, from a binary system to an ecosystem. And in 2019, the Monash Commission called for the renewal of post-compulsory education. It envisaged a system that nurtures adaptable, capable global citizens who are both job-ready and resilient in dealing with change.
There is no need for others to rethink the sector’s future on its behalf as it is already remaking itself.
A new world of post-compulsory education is rapidly emerging. It does not displace the old on-campus experiences with traditional providers offering broad-based and in-depth multi-year qualifications. Rather this world co-exists, interacts with, complements and supplements the old.
The curriculum is being unbundled – separating out discipline-specific and transferrable skills. Alternative, shorter form, and often micro-, credentials are being offered by traditional and non-traditional providers (including employers, industry and professional bodies and others), sometimes in partnership. Shorter form credentials are being accumulated and ‘stacked’ to form clusters of complementary skillsets and, in some cases, full qualifications.
In 2019, the estimated value of the global market was US$10 billion - small in comparison to the US$2.2 trillion spent on formal degrees. The source of this intelligence, Holon IQ, has since observed its explosive growth precipitated by COVID-19. It predicts a doubling of the market over three to five years.
In Australia, when Deloitte undertook its survey, 58% of respondents who were studying at the time were engaged in ‘formal study options’, which it defined as those developed and accredited under the Australian Qualifications Framework (AQF). Around 30% were studying towards non-AQF qualifications, either a professional designation, informal credentialled training, individual units of study or informal non-credentialled study. A larger share (38%) of workers who intended to study in the next three years were planning to pursue non-AQF study.
Less than three years and one pandemic later, credentialled short courses have become an important means of minimising the recessionary impact and positioning state and national economies for recovery.
COVID-19 restrictions have seen the pendulum swing from predominantly face-to-face learning experiences to 100% online delivery. As restrictions ease, it is swinging back again, but to different places, differentially blending face-to-face and online experiences depending on learner preferences, provider capabilities and other relevant considerations.
Shorter form credentials recognise attainment. This can be gained through engagement in learning experiences in either formal face-to-face or online settings, as just described. Or, increasingly, through the assessment of skills learned in other settings. DeakinCo’s Professional Practices credentials, for example, recognise transferrable skills learned in work and related contexts. There is no coursework. Credentials can be earned anytime and anywhere. But they must be earned: applicants must produce evidence that they satisfy AQF-aligned criteria.
A growing number of traditional (for example, DeakinCo and Monash University) and non-traditional (for example, CPA Australia and EY) providers of alternative and micro-credentials are capturing their holders’ attainments in digital badges. These can stand alone or feature in digital passports and ePortfolios and are shared with employers as evidence of applicants’ discipline-specific and transferrable skills.
What’s missing is reform
Post-compulsory education is remaking itself. What is urgently needed from governments is reforms that lubricate rather than add friction to the wheels of creative destruction. Policy and regulation should enable learning over lifetimes by recognising and verifying the quality and level of micro-credentials and supporting their attainment.
To give the Commonwealth and State governments their due, they have been responsive. An innovative initiative of the Victorian Government was to make available to displaced workers COVID-essential courses offered online through eWorks. Through the uptake of digital badges assessed by VETASSESS, these workers have been able to signal to employers their competencies gained and recommence work in areas of high demand, such as sanitisation. At the national level, higher education providers acted swiftly to offer a dizzying array of short courses in fields of national priority, taking advantage of the Commonwealth Government’s April 2020 announcement that it would subsidise fees. A year later, in April 2021, it announced ahead of its 2021-22 Budget that funding would be provided for an additional 5,000 short course places for domestic students at non-university higher education providers for delivery in Semester 2, 2021.
Related, the Commonwealth Treasury has sought comment on extending tax deductions beyond employment-related education and training expenses. The 2021-22 Budget did not include changes to this effect. It merely removed the current non-deductibility of the first $250 of eligible self-education expenses. This perhaps reflects contention regarding the broader reform proposals. While the intent is good, there are better ways of supporting the affordability of lifelong learning for all. The discussion below expands on this thinking.
Supporting the affordability of lifelong learning
In January 2021, the Commonwealth Treasury sought public comment on the proposition that it allow “deductions for education and training expenses not associated with current employment activities.” This is effectively a Government review of TR (tax ruling) 98/9 Income tax: Deductibility of self-education expenses incurred by an employee or person in business which only allows deductions for education and training that are directly related to current employment.
Current arrangements are not fit-for-purpose for the policy objective of rapid retraining of the current workforce, and re-skilling those who are out of work due to structural and COVID-related economic change.
An expansion in scope for tax deductibility of education and training expenses would be a fillip for retraining and better facilitate life-long learning - but other changes could have even greater impact.
In the same consultation, Treasury asked “is a new tax deduction the most effective mechanism to encourage Australians to retrain and reskill to support their future employment and career?” The answer to this question is probably “no”.
As tax deductions are only effective for those earning an income, a further development would be more equitable, and efficient. Ideally, government funding for training could be means-tested, with user co-payments higher for those who can afford it. Funding could then be focussed on those most in need of retraining.
The momentum and direction of change relating to short courses needs and related initiatives needs to be sustained and not unwound as conditions improve. What is needed is a bold and cohesive package of national reforms.
The past reviews, re-conceptualisations, re-imaginings and renewals referred to above were, by and large, inspired by the appeal of a more sector neutral approach to governments’ roles in vocational and higher education. They reflected hopes of seamless transitions, fairness in the reach and application of governments’ support, and of a regulatory approach that ensures the quality of offerings, regardless of whether they fall within the remit of vocational or higher education.
These remain laudable intentions, but they are insufficient to support the fast-emerging realities of post-compulsory education just described. Change abounds, irrespective of the roles played by governments, and has been turbo-charged by the current pandemic. To lubricate the wheels of change, governments need to be enablers – assisting access and choice – and assurers – of the level, equivalency and quality of credentials.
To this end there is a need to reform governance, regulatory and funding arrangements. Governance of post-compulsory education should ideally be neutral regarding credential length, sector or State, necessitating that Commonwealth and State governments rise above politics and act as one to support all post-compulsory learners. For optimal regulatory effect, credentials in need of accreditation, whether short or long, should ideally be recognised and verified within the same framework. In a less resource-constrained world, government funding assistance would also be credential-neutral, give agency to learners, and support lifelong-learning.
With COVID hastening the pace of change in post-compulsory education, the wheels are already in motion giving governments the opportunity to be the good oil. While the reforms required would still represent significant change, they are necessary, and perhaps easier while there is already great momentum.
About the author
Mary Clarke is the founder and principal of DXP Consulting, and the lead author of the 2018/19 Parents Report Card. She has headed the education policy function for a professional body, and executive and senior public service economic and policy roles. Mary holds an Executive Masters in Public Administration and an Honours degree in Economics.