Shaun Twaddle wants to see employers focus their efforts on supporting the third of school leavers who don’t enter the tertiary education system work-ready and into meaningful employment

By Shaun Twaddle*

Many young people are not work ready.

Talk to any employer in New Zealand who has tried to take on new staff recently and this will be one of their key gripes.

But is this really an issue?

Or is it simply one of those ‘things were different in my day’ chestnuts?

In my view it is a bit of both.

The only way I can see the work readiness issue of our young people being resolved is for employers and educators to work together to not only improve our productivity potential, but our overall wellbeing.

I am not talking about some kind of kumbaya hand holding exercise – I am talking about prioritisation of core issues and then both employers and the education sector putting in the hard yards in a few key areas over a number of years.

So what do employers actually want from our young people?

You don’t have to look far to find employers or their representatives grumbling about the work-readiness of young people.

For example, Employers Manufacturing Association Chief Executive Kim Campbell caused a bit of a media stir earlier this year by saying that

businesses keep reporting young people are leaving school without adequate work readiness skills.[1]

It’s great that employers are making their grumblings known, but as you will hopefully see – employers need to do more than just grumble.

Looking past the generic grumblings of employers it is clear that employer’s expectations increase as the level and type of study undertaken increases.  This makes sense.

For example, an employer may expect a young apprentice can just expect them to go out and ‘do an efficient and high quality job’ but wouldn’t dare expect the same thing of an 18 year old school leaver with NCEA Level 1.

There are, however, a few key skills that employers look for regardless of the role.  In its annual Occupational Outlook report the Ministry of Business, Innovation and Employment outlines 10 key skills employers look for:

- communication skills

- customer service skills – in person, on the phone, and online

- ability to work well in a team

- literacy and numeracy skills

- confidence in learning about and using computers and technology

- planning and organisational skills

- initiative and a can-do attitude

- problem-solving skills

- good work habits and independence

- understanding of health and safety

These skills are all transferable, which means they are useful in a wide range of jobs and are not specific to any one occupation or field.

So where are young people meant to get these skills?

What employers are after is a mix of capabilities and competencies that, in theory at least, are obtainable from our compulsory education system.  But are they?  Once again, it is a yes and no response.

The secondary education system is geared towards providing young people with foundational skills that provide the largest positive spillovers, enable people to enter tertiary education, obtain more skills and, of course, provide greater returns.

As the main investor, the government has identified that NCEA Level 2 provides young people with these foundational skills.  Hence the Government’s Better Public Service (BPS) target of increasing the proportion of 18 year olds with NCEA Level 2 or equivalent to 85% by 2017 (78.6% in 2013).

Now don’t get me wrong, the Government’s BPS target is laudable.

But, here is the issue: NCEA Level 2 foundation skills, the skills required by employers and work competence are not the same.

Yes, there are crossovers, but at the end of the day, NCEA qualifications, whatever way they are packaged, are primarily focused on providing the foundation for young people to progress into tertiary education rather than work.

The transitions that school leavers make are extremely important and can have a profound impact on their future outcomes, wellbeing and work readiness or ‘worth’ to employers.

Education data shows that 64% of domestic school leavers transitions into tertiary education in the year after leaving school with 29% undertaking university study and 35% entering into sub-degree tertiary education (i.e., going to a polytech, a private training establishment or entering industry training).[2]

Of young people transitioning into tertiary education, the government wants them to achieve at higher levels.  The economic rationale is simple - individuals, the economy and society benefits from young people gaining a tertiary education.  The government is explicit about this in its BPS target to have 55% of 25–34 year olds with have a tertiary qualification at Level 4 or above by 2017 (53.8% in 2013).

I am not so concerned about these 64% percent of school leavers.  The vast majority have an NCEA Level 2 qualification (71%).  By the time they graduate they will, hopefully, have demonstrated an ability to grasp a subject matter, progress it, and then demonstrate competencies in it.

Yes, there are tensions between employers and educationalists around some of this stuff, but in the grand scheme of things, I don’t think this is where greatest gains are to be had.

So where does that leave the 36% of school leavers who don’t transition into tertiary education?

The transitions that school leavers make are extremely important and can have a profound impact on their future outcomes, wellbeing and work readiness or ‘worth’ to employers.

Young people who do not transition into tertiary education are set off on a different trajectory than those that do.

If this doesn’t concern you, then it should.

Only 57% of domestic school leavers who do not transition into tertiary education have an NCEA Level 2 or higher.  Worse still, 18% have no formal school qualification.

These are the people that most employers see applying for jobs.  If these young people don’t find work, they are at risk of leaving the country or, worse, becoming what policy wonks term ‘not in employment, education or training’ (NEET).

There are initiatives to support these young people – but employers need to be engaged

The government has a few really good ideas for informing students about what employers are looking for and actually involving industry in the process.  One such initiative is Vocational Pathways, its flagship education initiative, launched in 2013. 

Vocational Pathways  is a collaborative effort between industry representatives and the secondary and tertiary education sectors (I can tell you from experience that this type of collaboration doesn’t happen very often!).

It utilises the existing NCEA system in a way that provides six[3] broad vocational and academic pathways for secondary school students at NCEA Level 2 that are recognised and valued by employers.  Each of the six pathways is designed, among other things, to

- show secondary school students the foundation and ‘work ready’ skills that employers are looking for;

- bring the real world beyond the classroom, and keep young people interested in study;

- give students clear options based on the future they see themselves; and

- provide employers with a better understanding of the relevance of the study.

As you can probably tell, I think Vocational Pathways is a great initiative.  To this end, I have spent a lot of time over the past couple of years on various Vocational Pathways working groups.

But there is one big obstacle that I thinks needs to be overcome if it is going to live up to its potential and be powerful in supporting those who need it the most – secondary school students that are not going to directly transition into tertiary education.

In my view, the Ministry of Education can’t do this alone.  To their credit, they recognise this and are engaging with industry and employers.

But let’s be honest – how many of you had heard about Vocational Pathways before I mentioned it?

Employers and secondary schools need to work better together if this is going to work.

The families of students also need to know about the initiative and engage with it.  Most parents of secondary school students know how many credits are required to get into university – this is not hard, as universities have had years of experience in getting their message across.

The challenge for Vocational Pathway is not to compete with this message, but to provide an alternative set of core requirement that are valued by employers, known and easily understood.

But employer engagement in education is also needed elsewhere

It’s all very good to say that employers should focus on school leavers who don’t transition into tertiary education. But in reality employers are increasingly being drawn into battle in a number of other parts of the education sector as well.  It's no-ones fault, and no one is narcissistically out to screw employers or young people over.  The education system is complex and even the best intentioned policy has unintended consequences. 

The following are two examples where I heard of employers getting involved in education recently.  They are two of many.

One relates to a policy that the government seems increasingly wedded to over the coming years:  not providing government funding to people to study at a level that they already have a qualification in.  On the face of it, this makes sense from an investment perspective.  As a taxpayer, why should we be funding someone to gain a Level 2 qualification post school when they already have an NCEA Level 2 qualification?

In many, if not most cases, taxpayers should not.  In a few instances however, there is a valid reason for the government to fund this sort of education if industry demands it.  For example, in the forestry industry, with its high rate of work-related injuries and fatalities, would employers really be wanting to employ someone with an NCEA level 2 qualification but no health and safety knowledge or ability to work unsupervised? My response would be no.  Similar parallels could be to a number of industries where personal or public safety are of paramount importance, such a healthcare or the operation of heavy machinery.   There has to be a happy medium somewhere.

My second example is a potential unintended consequence of the governments push to get young people to achieve at higher levels.  This, along with other policies, incentivises some in the education sector to ‘bump up’ the level of qualifications or units to meet particular needs, such as higher funding levels. Many in the sector call this ‘qualification creep’.

So why is qualification creep concerning employers?  Qualification creep is a worry because it makes the qualification system so much more complex for employers who want to take on young people and, ultimately, could threaten the credibility of the New Zealand Qualifications Framework.

What does this mean for employers and in what direction should they be pulled?

Employers are being pulled in multiple directions by the education sector and they have limited resource – they have businesses to run too !

The impact of employers being pulled in various directions is that their influence over education becomes seriously diminished.

In my view, there are realistically only a small number of areas in education that employers can actively get involved in. This will help ensure that they get the biggest bang for their buck.

Improving the work ready skills of the 36% of school leavers who do not transition into tertiary education/Vocational Pathways must be one of these.

Yes, it will be tough and take time, but if we don’t fix the problem before the crucial secondary-transition stage, it will just become worse further down the track.

All the other areas, such as qualification creep and workforce planning, should be left to a series of industry bodies who have, as one of their core roles, responsibility for advocating the skills needs of employers and industry with the education sector.

Until recently, industry training organisations (ITOs) had this role as one of their mandated functions. Yes, their performance in this role was mixed, but they did come up with some real gems – Vocational Pathways, for example, came from the ITO sector.

I would advocate that we give this role back to ITOs and, at the same time, set some clear expectations of what this role entails.  After all, isn’t this government all about high trust, high accountability’ relationships?

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[1] http://www.scoop.co.nz/stories/BU1406/S00871/wanted-work-readiness-certificates-for-school-leavers.htm

[2] Domestic school leaver transitions derived from Ministry of Education ‘Transitions from School to Tertiary data’ (2013).

[3] The six broad pathways are: Primary Industries; Services Industries; Social & Community Services; Manufacturing & Technology; Construction & Infrastructure; and Creative Industries

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Shaun Twaddle is a senior economist at Infometrics. Shaun has spent most of his career focusing on tertiary education, skills and the labour market. You can contact him here »