4102.0 - Australian Social Trends, 1995  
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 20/06/1995   
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Contents >> Education >> Education and Work: Employee training

Education and Work: Employee training

In 1993, 6.1 million employees undertook training, a 15% increase from 1989. This increase was partly due to the introduction of training guarantee legislation.

Over the last decade there has been a growing emphasis on education and training in most OECD countries, including Australia. The government has recognised that increasing the range of skills in the labour force, particularly in the areas of high technology, will promote economic growth and improve Australia's international competitiveness.

The government has therefore promoted education and training in several ways. These include: the introduction of the Training Guarantee legislation (TG); the establishment of the National Training Board which is responsible for the development and implementation of a national competency-based training system; the establishment of the Australian National Training Authority (ANTA) which is responsible for TAFE and Skills Centres funding; and the release of Working Nation, the White Paper on Employment and Growth, which includes details of a number of new training programs and modifications to existing programs.


Training

Training refers to activities which develop or maintain skills related to job performance and/or competency. Training includes formal instruction and on-the-job training.

External training courses are those which are organised and conducted by training or educational establishments, agencies or consultants other than a person's employer or business. They include TAFE courses and university studies.

In-house training courses are those organised by a person's employer or business primarily for their own staff and using the employers' or business' staff or training consultants.

On-the-job training involves activities such as being shown how to do the job, watching others work, asking questions of co-workers and teaching oneself.

Small employers are organisations with between 1 and 19 employees. Medium employers are organisations with between 20 and 99 employees. Large employers are organisations with 100 or more employees.

Training Guarantee legislation

In July 1990, the government introduced the Training Guarantee legislation (TG). The TG required employers with a set minimum annual national payroll ($226,000 in 1993-94) to spend a minimum proportion of their payroll (1.5% in 1993-94) on training. Those who spent less had to pay the shortfall in taxation. In July 1994, the TG was suspended for two years because of the demonstrated commitment by industry to meet its training obligations over the past few years, and in the light of the government's commitment to training reform outlined in Working Nation, the White Paper on Employment and Growth.


Employee training
In 1993, 86% of all employees undertook some form of training, up from 79% in 1989. This increase was partly due to the introduction of the TG and most of it occurred in on-the-job training. On-the-job training was also the most common form of training, undertaken by 82% of employees in 1993 and 72% in 1989. In both years, almost half of all employees undertook study or a training course, mostly in-house training. There was an increase in the proportion of employees undertaking employer supported external training.

Each employee spent, on average, 5.6 hours on training between July and September 1993. This was down from 5.9 hours during the same period in 19901. This may have been due to increasing costs associated with training or differences in the types of training undertaken.

EMPLOYEES WHO UNDERTOOK TRAINING
1989
1993
Type of Training
%
%
Some training undertaken
79.0
85.8
    Study or training course undertaken
47.8
47.0
      Studied in previous year
16.8
18.6
      In-house training
34.9
31.3
      External training
9.8
11.8
        Employer supported
6.4
7.3
        Not employer supported(a)
3.4
4.5
    On-the-job training
71.8
81.8
No training undertaken
21.0
14.2
Total(b)
100.0
100.0
'000
'000
Total employees
6,704.7
7,078.7
(a) Includes people who attended external training courses while not working.
(b) Totals may not add to 100% because employees may have participated in more than one type of training.

Source: Survey of How Workers Get Their Training (1989); Survey of Training and Education (1993)


Training expenditure1
Between July and September 1993, employers spent $1.1 billion on employee training, an average of $192 per employee. This represented 3% of gross wages and salaries, well above the 1.5% required by the TG legislation.

A greater proportion of medium and large employers than small employers spent money on training. This was mainly because many small employers have an annual payroll below the TG minimum and, therefore, are out of the scope of the legislation. Three-quarters of employers in the scope of the TG legislation spent some money on training, accounting for 96% of all money spent on training. Of employers below the TG threshold, 13% spent money on training.

Employee training by industry
The amount of training an employee received varied according to the industry they worked in. Training provided in an industry is affected by a number of factors. These include the average size of organisations operating within that industry, the extent of technological and structural change taking place, and the mix of private and public organisations in the industry.

In 1993, 91% of employees in mining; electricity, gas and water; and community services undertook training. This was followed by public administration and defence (90%). Employees in the manufacturing industry were the least likely to have undertaken training (80%).

Training expenditure also varied according to industry. The communication and mining industries spent the greatest proportion of their gross wages and salaries (5%) on employee training. The construction and recreation, personal and other services industries spent the least, less than 2%.

TRAINING UNDERTAKEN BY INDUSTRY, 1993
Employees(a)
Average spent(b)
Industry
%
%
Mining
91.2
5.1
Electricity, gas and water
90.7
4.4
Community services
90.7
2.9
Public administration and defence
90.0
3.2
Finance, property, business services
89.2
3.2
Communication
86.6
5.4
Construction
84.8
1.8
Wholesale and retail trade
84.4
2.4
Recreation, personal & other services
82.1
1.9
Transport and storage
81.8
2.7
Manufacturing
80.1
2.6
Total
85.8
2.9
(a) Proportion of employees who undertook some form of training.
(b) Proportion of gross wages and salaries spent on training.

Source: Survey of Training and Education; Training Expenditure Survey


In-house training
In 1993, 2.2 million employees took in-house training courses, a fall of 5% from 1989. The most common type of training courses were in the management and professional field. 30% of employees reported that the main type of course they attended was in this field. This was followed by technical and para-professional courses (13%) and sales and personal service courses (12%). Attendance at courses in each of these fields increased between 1989 and 1993.

Large employers were more likely to offer in-house training programs than small employers. In 1993, less than 1% of the gross wages and salaries of small employers was spent on in-house training. Large employers spent nearly three times as much.

External training courses
In 1993, 836,000 employees attended external training courses, a 27% increase from 1989. 31% of employees reported that the main type of external training course they attended was in the management and professional field. Courses in computing (14%) and courses in the technical and para-professional field (11%) were also commonly attended. Only 4% of employees attended external courses in the clerical or office field.

FIELD OF MAIN TRAINING COURSE ATTENDED BY EMPLOYEES
In-house
External
1989
1993
1989
1993
Field of training
%
%
%
%
Management and professional
26.4
30.1
31.5
30.7
Technical and para-professional
9.9
12.9
10.4
10.8
Trade/craft
4.3
6.2
9.3
8.1
Clerical/office
7.5
5.1
6.1
4.2
Sales and personal service
10.7
11.6
8.5
9.4
Induction
4.3
3.4
(b)
(b)
General supervisory
4.6
3.2
(b)
(b)
General computing
10.4
9.5
12.8
13.5
General health and safety
10.8
7.0
5.8
5.1
Other courses(a)
11.0
11.1
15.6
18.2
Total
100.0
100.0
100.0
100.0
'000
'000
'000
'000
Total employees who attended a training course
2,337.5
2,214.2
658.4
835.6
(a) Includes transport and machinery operation, labouring and related, English language, literacy, numeracy, music, arts and other training courses.
(b) Included in other fields.

Source: Survey of How Workers Get Their Training (1989); Survey of Training and Education (1993)


Reasons employers provided training
In 1994, 32% of employers provided training for their employees during the previous 12 months. The most commonly reported reason was to improve employees' work performance (80%). 99% of large employers provided training compared to 92% of medium employers and 25% of small employers. For all of them, the most commonly reported reason was to improve the work performance of employees.

Meeting the requirements of the TG legislation was reported as a reason for training by 30% of employers overall and by 46% of medium employers. More than half (57%) of the employers above the TG threshold reported that the introduction of the TG in 1990 had resulted in increased expenditure on training for their employees. 6% of employers above the TG threshold who provided training reported that the TG legislation was their only reason for training expenditure.

REASONS EMPLOYERS PROVIDED TRAINING(a), 1994
Small employers
Medium employers
Large employers
Total
Reasons for training
%
%
%
%
Improve work performance of employees
75.6
87.2
95.8
79.8
Enable movement to other positions within organisation(b)
35.2
47.9
68.5
40.6
Multi-skill employees
32.9
51.2
69.3
39.9
Meet Training Guarantee requirements
23.8
46.0
30.7
29.5
'000
'000
'000
'000
Employers who provided training
61.3
20.9
6.5
88.8
Employers who did not provide training
188.5
1.8
* *
190.4
(a) Refers to training during the 12 months ending February 1994. Percentages do not add to total because employers may have had more than one reason for providing employee training.
(b) Includes employees being trained to move to more highly skilled or responsible positions within the organisation, or to fill identified vacant positions from within the organisation.

Source: Training Practices Survey


Reasons employees undertook training
In 1993, retraining to do different duties in the same job was the most common reason employees undertook training (36%). Other reasons for retraining included retraining to get a different job with the same employer (13%) and retraining to change employers (9%).

One-third of employees undertook training to increase their chances of promotion; just over half of them undertook training courses because they saw it as necessary to obtain a promotion while the rest saw it as helpful in obtaining a promotion.

Retraining to do different duties in the same job was the most common reason for both in-house and external training. However, in-house training was more commonly undertaken than external training for promotion reasons. Retraining to change employers was more common among people who undertook external training than among those who did in-house training.

REASONS FOR EMPLOYEES UNDERTAKING TRAINING(a), 1993
In-house training
External training
Total
Reasons for training
%
%
%
Retraining to do different duties in the same job
35.9
37.4
36.2
Necessary to obtain a promotion
21.4
8.6
18.2
To help in obtaining a promotion
16.6
11.9
15.4
Retraining to get a different job with the same employer
13.1
12.9
13.0
Retraining to change employers
7.3
14.7
9.1
(a) Percentages do not add to 100% because employees may have had more than one reason for undertaking training.

Source: Survey of Training and Education


Endnotes
1 Employer Training Expenditure (cat. no. 6353.0).




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