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Forecasting future demands: What we can and cannot know
The vocational education and training (VET) sector seeks to teach courses that will meet future demands from employers in terms of the quantity and types of skills required. The question is how does the VET sector anticipate what these future demands might be in the context of a rapidly evolving economy.
This report is part of the larger research program, ‘A well-skilled future: Tailoring VET to the emerging labour market’.
- The MONASH model for projecting future skills needs is of high quality by international standards, but the complexity of the economy is such that it is not possible to make accurate projections of future skill needs in any detail, or for more than a few years into the future.
- New VET graduates play only a modest part in filling expanding skilled vacancies; other sources of supply are people who learn the required skills on the job and people who already have the required skills, but who are working in other jobs, are out of the labour force or are unemployed, or are migrants.
- VET planners should not try to match training to projected skills needs in any precise way; they should instead focus on distinguishing skills that are in growing demand from those in declining demand, and on skills that take a long time to learn (and to gear up to teach).
- VET planners also need to anticipate areas where there are large numbers of people with specific skills who will leave employment in the forecast period, that is, replacement demand.
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