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Insight issue #53   ·  28 November 2014

The role of VET in economically vulnerable regions

Economic upheaval, whatever form it takes (plummeting financial markets at a global level, changes to the terms of trade and natural disasters are examples), is not an infrequent occurrence. How vulnerable communities are to the structural economic changes that such events prompt may be determined by factors such as population size, communities’ ability to adapt to the change, or their economic diversity.

Economic vulnerability in Australia, 2002–12: an employment perspective looks at ways to characterise the vulnerability of regions to structural economic change, with a particular focus on changes in employment within industries over time. NCVER found the impacts of structural economic changes are broad and sustained and tend to affect all employment in a region, not just particular industries.

Indicators of economic vulnerability

Five indicators are used to determine economic vulnerability:

  • the change in the average hours worked per region
  • the change in the total hours worked in each region
  • the extent of population change in a region
  • a simple index of structural or industry shift within a region across two time periods
  • an index of turbulence within a region, that is, the extent to which people move from employment to unemployment, and from unemployment to employment.

Focusing only on these indicators provides a narrower view of what some refer to as community disadvantage, a concept that covers the economic as well as social and environmental factors.

In 2012, manufacturing, health care and social assistance, and retail industries tended to dominate in the more economically vulnerable regions. Whereas mining and construction featured strongly in the least economically vulnerable regions, even though the cyclical nature of these industries can be seen as a challenge. Not all vulnerable regions have clearly dominant industries but have instead a broader mix of industries.

What role does VET have?

Looking at indicators of economic vulnerability can highlight where and what type of assistance might be provided to help people in vulnerable areas get or retain jobs. This is relevant to vocational education and training (VET) providers who are most often tasked with responding to the training needs of retrenched workers or those in economically vulnerable industries.

The role of VET in lessening the impact of structural economic change is the focus of two current research projects recently commissioned through the National VET Research program targeted funding round. Dr Darryn Snell from RMIT is looking at factors that facilitate or impede cross-occupational skills transfer between declining and growing occupations. The second project, by Professor Victor Callan and Dr Kaye Bowman, Callan Consulting Group, will focus on factors that impact upon the successful skills transfer, re-skilling or training of older workers being affected by structural economic change in the manufacturing industry. Both projects will be completed in 2015.

To access Economic vulnerability in Australia, 2002–12: an employment perspective, visit www.ncver.edu.au/publications/2707.html.

To find out more about the two recently commissioned projects, go to:

Cross-occupational skill transferability: challenges and opportunities in a changing economy.

Skills transfer, re-skilling and training of older workers in response to industry restructuring.

This work was produced by NCVER on behalf of the Australian Government and state and territory governments. 

Image: Getty Images/Thinkstock