Shedding light: private ‘for profit’ training providers and young early school leavers

By George Myconos, Kira Clarke, Kitty Te Riele Research report 23 September 2016 978 1 925173 62 8


This research aims to shed light on the role of private providers in delivering training to a particular cohort of learners, young people who have left school early. The authors surveyed 130 private ‘for profit’ registered training organisations (RTOs) to find out their perspectives on teaching and learning practices, engaging with early school leavers, and the educational and wellbeing support services provided to the young learners.

While the private RTOs in the study were eager to show a willingness to support the learners to complete their qualifications, unsurprisingly, their ability to do so is limited by the commercial realities of running a business in the ever-changing vocational education and training landscape.


About the research

This research aims to shed light on the role of private providers in delivering training to a particular cohort of learners, young people who have left school early. The authors surveyed 130 private, for-profit registered training organisations (RTOs) to find out their perspectives on teaching and learning practices, engaging with early school leavers, and the educational and wellbeing support services provided to these young learners.

Key messages

  • Young early school leaver learners face a range of barriers to participating in education and completing their qualifications. The extent and persistence of these barriers is not always evident until after enrolment. Given the often small size of private RTOs, there remain challenges as to how they can help address barriers to participation in and completion of VET.
  • The size of private RTOs is important, with private RTOs claiming their small scale appeals to early school leavers who may have struggled in larger institutional settings. However, the size of many private RTOs can also cause problems as they may be too small to provide adequate infrastructure and support services to the learners.
  • The strengths identified by the surveyed private RTOs include:
    • mentoring and pathways support staff
    • language
    • literacy and numeracy programs and support
    • strong employer/industry connections to facilitate workplace-based training.
  • The private RTOs in the study were eager to show a commitment to early school leavers and a willingness to support these learners to complete their qualifications. However, unsurprisingly, this is limited by the commercial realities of running a business in the ever-changing VET landscape and funding regimes.

The practices of private RTOs have come under intense scrutiny in recent times. With the introduction of the total VET activity (TVA) data collection, it will be useful to glean more information over the coming years and hopefully help shed more light on private RTOs and the training they provide to all learners.

Dr Craig Fowler
Managing Director, NCVER

Executive summary

In this research we investigate an oft-criticised segment of the vocational education and training (VET) sector in Australia — private, for-profit registered training organisations (RTOs) — with the aim of gaining a clearer understanding of the approaches they adopt in training 15 to 19-year-olds who have left school early. Through a nationwide survey of private RTOs and a series of consultations with providers and industry stakeholders in Victoria, South Australia and Queensland, we set out to reveal the nature of training provided by private RTOs to those young people seeking to complete their initial qualification and the ways by which they respond to the needs of their young learners. On the basis of the findings we consider the changes that may be needed in order to improve the training outcomes for this growing cohort of learners.

The research is set against a background of federal, state and territory-based training entitlement regimes, which ensure a greater role for the VET sector in supporting the initial qualification attainment of young Australians. It has also been undertaken at a time when state and national governments are promoting a marketised and, consequently, highly competitive provider environment, prompted largely by the 2012 National Agreement for Skills and Workforce Development and the National Partnership Agreement on Skills Reform. These initiatives saw an expansion in both the number of private RTOs accessing government-funding, which now comprise approximately 3000 of Australia’s 4200 registered training providers1, and the number of private RTOs delivering vocational education to early school leavers.

In this context we see a convergence of two trends: a high number of private RTOs that often lack the infrastructure, economies of scale and student supports found in TAFE (technical and further education) institutions; and a high number of young early school leavers relying on such providers to help them to renew or continue their education.

While the numbers of young people undertaking vocational education have increased, the completion rates of publicly subsidised courses remain very low. Data from the National Centre for Vocational Education Research (NCVER) indicate that, for those aged under 25 years in full-time study with no prior post school qualification, the estimated completion rate is 51.6% (NCVER 2016). This suggests that catering to the needs of young people in VET — across all provider types and settings — remains a significant challenge. It is for this reason that we focus on the private RTOs, who now represent a prominent segment of the VET landscape.


The characteristics of private RTOs catering to the 15 to 19-year-old cohort

  • Private RTOs consider their small-scale, intimate and relatively informal learning settings to be distinctive characteristics. They regard their ability to engage learners face-to-face, either in small groups or individually, as a distinct advantage.
  • Private RTOs report that their relatively close connections with employers, including their capacity to facilitate training in a workplace context, are of great benefit to young learners as they respond positively to practical, hands-on, real-world learning.In addition to the size and scale of delivery, a frequent benefit identified by the provider interviewees was their focused ‘scope of delivery’ in a limited range of fields of education. This specialisation enables strong links with employers and the capacity to contextualise student support services for particular industry and occupational needs.

Identifying the private RTOs’ early school leaver cohort and their needs

  • A significant proportion of the early school leavers gravitating towards private RTOs and, in all likelihood to vocational education in general, have experienced a range of social and educational challenges. The cohort in question can, by most measures, be regarded as disadvantaged.
  • While providers are aware of the many needs of their young students — arising from personal, familial, and social problems, which in many cases also contribute to their disengagement from mainstream secondary schooling — the scale and complexity of the needs become evident to trainers gradually, and subsequent to enrolment.
  • Barriers that are likely to impede completion were ranked by the survey respondents, with the most prominent being disengagement, low motivation and commitment, lack of support when experiencing relationship problems, health, drug and alcohol problems, and learning difficulties.
  • Other barriers identified were poor social and communication skills, confusion about career goals and financial, transport and housing stress. Although concerns with language, literacy and numeracy (LLN) skills deficiencies did not rank as the most pressing concern for survey respondents, they did figure prominently in interviews with private RTO staff.
  • Providers conveyed what they felt were widely held views among employers: in essence, that students lack the social skills needed to engage in the workplace, as well as an understanding of the basic expectations of that setting.

Lessons from a review of how private RTOs address student needs

  • Providers are ill-equipped to address complex personal and social barriers to learning, more often limiting their assistance to the provision of the internet, study spaces, computers and some academic skills support.
  • Remedial language, literacy and numeracy programs are available in many instances, but the approach across those private RTOs consulted is inconsistent. For many, ‘literacy’ is a context-specific term, with the key determinant being the expectations of the industry associated with the qualification.
  • Developing positive interpersonal relations with students is considered vital. Therefore the skills deemed essential for trainers were relationship-building, empathy, patience, humour, behaviour management, planning and leadership, the capacity to mentor and act as a role model, as well as a sound knowledge of the chosen trade.
  • Interviewees emphasised the importance of providing the guidance and stability that enables a young person to make informed decisions about their future, within or beyond the confines of the industry associated with their current training.
  • Employment-based training, along with structured workplace learning, was ranked the most important of all formalised program-level student supports.
  • External agencies, notably Job Services Australia agencies, play an important role in referring young people to the appropriate training; however, private RTOs are concerned that misjudgements often lead to training that is of little interest to the young person.
  • Private RTOs have difficulty reconciling the needs of young early school leavers, who may be indecisive, confused and experiencing instability, with the requirements of a training system that is, by design, prescriptive. They spoke of a tension between ensuring progress is made towards qualifications and the need to provide support and guidance to those who are yet to articulate, let alone decide upon, a preferred pathway.

The role played by private RTOs and the challenges faced

  • Young early school leavers constitute a growing cohort for private RTOs and the key driver of increasing enrolments is federal, state and territory government policy aimed at increasing educational attainments through the use of learner subsidies.
  • Private RTOs expressed what seemed to be a shared sentiment: that efforts directed to mentoring and supporting young people go largely unrecognised and that private RTOs are not accorded due respect in the VET sector.
  • There are concerns among private RTOs and industry stakeholders about low-quality training, resulting from poor regulation of the sector, and about the possible consequences not only for learners, but for those who may eventually be in the care of graduates still lacking essential skills.

Conclusion and recommendations

Although this research provides the perspectives of a significant number of private RTOs, it is not a definitive account of the interactions between young people and these providers, or of the interactions of these RTOs with the wider community of training providers. Nonetheless, we can say that, on the basis of the survey and interview feedback from private RTOs and stakeholders, there is a stated commitment on their part to assist the young early school leaver cohort in attaining vocational and broader life skills. It is equally apparent from feedback that the capacity to realise this commitment is diminished in large part by the commercial realities, policies and funding regimes that encourage ‘short-termism’. Indeed, while the relatively small scale of most operations is an advantage, this very feature intensifies their commercial vulnerability and further reduces the capacity of providers to develop the expertise and tailored programs needed to assist young learners. Based on these conclusions we submit the following recommendations:

  • Government, industry, referral agencies, and those in education should regard private RTOs as partners in efforts to re-engage young people whose education has been disrupted.
  • More effective career guidance — prior to and during training — should be provided by schools and referral agencies in order to assist young people to make better assessments of their goals and suitable training options.
  • The apparent effectiveness of employment-based training, along with private RTOs’ specialisations and their closer links with industry, should prompt governments to shape policies that maximise the potential of private RTOs.
  • Incentives could be provided to employers hosting young learners to encourage closer collaboration with private RTOs in the provision of structured mentoring and support.
  • The importance of small informal and welcoming learning settings must be acknowledged, as must their limitations. To maximise the advantages inherent in small-scale operations, targeted assistance should be provided to suitably qualified niche providers for the express purpose of increasing their capacity to address student needs.
  • Intake and enrolment process requirements should be modified such that they have the capacity to identify a broad range of wellbeing needs, and the information gleaned should prompt cross-sector referrals by private RTOs and closer relations between private RTOs and specialist support agencies.

1   Source: 2015 National VET Provider Collection, extracted from on 3 August 2016.


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