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Insight issue #58 22 August 2016

Building innovation – are the foundations solid enough?

Now is the time to embrace new ideas in science and innovation according to the Federal Government’s National Innovation and Science Agenda (NISA). The Agenda has been promoted as a means to boost productivity and the economy, focusing on the need for greater collaboration between education and business sectors; for risk-taking and financial support for start-ups; for attracting innovators to Australia; and for ensuring Australian students have the skills needed for jobs of the future.

A driving force behind the interest in innovation is that it feeds into productivity growth and hence economic growth and improved living standards.

But what is innovation and innovation skills?

Innovation is a vague concept that means different things to different people. It can be broadly thought of as technological innovation (including research and development) or invention. The Australian Bureau of Statistics defines it as ‘the introduction of a new or significantly improved good or service; operational process; organisational/managerial process or marketing method.’ For something to be innovative, it needs to be new to the organisation. It can either be developed by the firm or be introduced to the firm. Innovation does not need to be something completely new.

It could be argued innovation skills per se do not exist; rather, there are skills for innovation that are essentially technical (for example, science, technology, engineering, business skills) as well as generic, often cognitive or soft skills such as critical thinking, problem solving, communication, entrepreneurship, writing and numeracy. The skills that are needed will depend on the context of their use.

Is innovation for everyone, or just some?

There is no argument against the need to bolster skills needed for jobs of the future. What needs greater consideration though is how we can provide opportunities for everyone–the unemployed or underemployed, people with disability, mature-age job seekers etc–to be part of this ‘exciting time to be an Australian’.

That skills for innovation are also considered to encompass a range of cognitive or soft skills highlight the need to ensure everyone has sufficient foundation skills, that is, English language, literacy and numeracy as well as employability skills. Especially important for the innovation agenda is the development of digital literacy and entrepreneurship skills.

However, OECD assessments indicate that around 44% of Australia’s working-age population (15 -74 years) have low to very low literacy skills with approximately 54% having low to very low numeracy skills. For problem solving skills in a technology-rich environment, 44% of 15 -74 year olds were estimated to have low to very low skills. A recent survey of employers undertaken by the Australian Industry Group found that 93% of participants identified low levels of literacy and numeracy having an impact on their business and note that the “mastery of literacy and numeracy is increasingly more important to meet the challenges of the evolving economy”.

The challenge is for all education sectors—school, vocational education and training, university—to focus on making sure the foundations that will help build innovative, creative, entrepreneurial activity are strong; to put as much focus on ensuring the language, literacy, numeracy and employability skills continue to develop.

Innovation, in whatever form it takes, cannot be fostered among individuals, enterprises or governments, unless the issue of low foundation skills among the broader population is addressed. Otherwise the transformations that innovation could bring—to the way we live, work, communicate—will not be shared by all.