State of VET survey results – Some interesting perspectives!
April 19, 2016 8 Comments
As some of you know a few weeks ago I asked people who were interested to fill out a quick survey I had created about their perception of the how the VET sector was travelling at the moment and their confidence in the sector moving forward. Now it has taken me a little while to get back to the survey because, frankly, I was overwhelmed by the number of responses that I got and it has taken some time to troll through the data and to think about what that data says. Firstly then a very, very big thank you to everyone who filled in the survey and now on to the results.
Most of the responses were from those in non-public providers, about 70%, 15% were from TAFEs and the final 15% made up of independent trainers and assessors, consultants and others, with respondents from across a wide range of roles within the sector. Which given the make up of the sector itself is not too bad a mix. What I found interesting given the respondents was when I looked at the data there was so much cohesion around the answers to the various questions I posed.
The first two pieces of data are about respondents satisfaction with the sector and how they think the sector will travel of the next 12 months.
A huge 80% of respondents were either very dissatisfied or dissatisfied with the current state of the sector and 79% of the sector thinks that the situation is either going to stay the same or get worse over the next 12 months. Interestingly while as a sector we seem to a little disillusioned shall we say and think things are likely to remain how they are for a while, it seems that we don’t really think it is going to have too much effect on your student numbers. Sure no one it seems expects that there is going to huge growth in the number of students they enroll over the next 12 months but only a small number feel that there will be a significant decrease in student numbers as well.
The other piece of data that I found worrying was perceptions around financial security and profitability. The majority of respondents felt, not unsurprisingly I think, that their profitability was either going to remain the same of decrease. With smaller number predicting increases or substantial decreases
This of course translates into the fact that only 18% of respondents felt that their ongoing financial security was either sound or very sound.
Which then underlies the fact that in general providers feel the revenue they generate from traditional sources is going to decrease over the next 12 months, but there also seems to be a level of confidence that revenue from other sources will rise.
These factors of course will then have an effect on the make up of the VET sector workforce as can be seen below.
So what does all of this mean? Well not unexpectedly I think it points strongly to the fact that we are currently part of a sector which is in a state of flux and which is to some extent attempting to find its feet again and that this general uncertainty will be something we are going to have to live with at least until the end of 2016 and may a little longer after that as well. There will be and in a lot of cases should be a tightening of belts and more fiscal responsibility from providers. We will see less sponsorship of football teams and more money being concentrated where it should be, on student outcomes and completions. We are also going to see the the dollar value per student reduce across the board, be it VFH, State funding or Fee for Service. Providers will get less overall money per student which will result in lower profitability in most cases. Are we going to see more providers abandon the market either voluntarily or through administration? Clearly I think the answer there is a definitive yes. There are still a couple of the larger (primarily VFH fueled providers) who are close to the bone at the moment, but not being publicly traded makes it difficult to know just how close they are. I also think that a number of smaller providers will simply walk away, some for profitability reasons, other just because it is becoming to hard to be a small player unless you other systems supporting you. I know of a number of providers who have walked away from State government contracts to deliver training, because for the small number of students they put through the additional compliance and paperwork made it not cost-effective. These providers haven’t walked away entirely though, but have simply gone back to doing fee for service business.
So what do other people think of the data, what it means and how you think things are going to pan out over the next 12 months or so.