The State of VET in Australia
The Vocational Education and Training (VET) sector in Australia is experiencing significant transformation. With the introduction of the VET Workforce Blueprint, new National Partnership Agreements, updated standards, and looming changes to the ESOS Act, the landscape is shifting rapidly.
Add to this the rebuilding of TAFE, the rise of micro-credentials, dire skills shortages, and increasing business costs, and it's clear that change is the new constant. As Managing Director Andrew Stuart notes:
Recruitment & Hiring Trends
The recruitment landscape in VET has shifted significantly. We're observing several key trends that RTOs need to understand:
- Slowdown in permanent placements: This reflects decreased business confidence across the sector, with organisations being more cautious about long-term commitments.
- Reassessing staffing models: Some traditional roles are being replaced by outsourced administration and compliance processes to reduce risks and fixed costs.
- Increased demand for contract staff: Contract "on-hire" staff who are engaged to address specific changes or challenges are in higher demand.
- Short-term project leads: Professionals with VET experience are in high demand to help achieve change objectives within set project timeframes.
increase in job board registrations in recent months, reflecting a softer demand from CRICOS providers and more professionals seeking new opportunities
Demand for Learning Design
Experienced learning designers with industry specialisations remain highly sought after, especially for work on more technical training packages. RTOs are not only aiming to meet training package changes but are also focused on:
- Enhancing student engagement and completion rates
- Updating assessments to be more authentic and industry-relevant
- Modernising face-to-face training materials
- Elevating online learning experiences
Large enterprises and government agencies are increasingly seeking more formal approaches to assure learning outcomes in their non-accredited professional development or internal compliance training content.
The Rise of Micro-credentials
Major players continue to invest in the development of micro-credentials. The Australian Government launched the National Microcredentials Framework in 2022 to standardise and promote the uptake of micro-credentials across the country.
This initiative supports lifelong learning and helps address skill shortages by providing flexible, targeted training options. RTOs that can develop and deliver high-quality micro-credentials are well-positioned for growth.
Investment in Strategy
Savvy businesses view recent changes as opportunities for disruption and are actively searching for emerging prospects. Key strategic focuses include:
- Revenue-cost alignment: Strategies that align revenue with costs, with a preference for models that reduce fixed overheads in favour of direct costs.
- Optimal student experience: Strategic thinkers are exploring how to maintain quality while being ready to scale when market conditions improve.
- Targeted go-to-market strategies: VET providers are ensuring their strategies are targeted, adaptable, and deliver short-term ROI.
Focus on Cost Reduction
Efficiency is a top priority for all providers. Organisations are seeking strategic support to rethink their operating models with several key objectives:
- Increasing operational efficiency
- De-risking their businesses
- Adopting new technologies where there's potential to reduce operating and transition costs
- Reducing fixed costs while improving quality
Growth & Acquisition Opportunities
Despite the challenges, growth opportunities exist for those who know where to look:
- Revenue diversification: RTOs are looking to diversify their revenue sources, especially those reliant exclusively on international students or state government funding.
- Acquisition targets: Asset-strong organisations continue to search for acquisition targets. RTOs are being sold, and there's been no significant slowdown in applications to register new RTOs.
- State funding contracts: Several clients are looking to acquire RTOs with state funding contracts, focusing on community services, business, and WHS licence/trades scopes.
What's Next for the Sector
The impact of changes to legislation for CRICOS providers has been well documented, but the full effects are yet to be realised. We've observed many experienced VET professionals:
- Leaving the private sector in favour of education-related roles within government agencies
- Leveraging their transferable skills to reinvent themselves in alternative sectors
There's also increased demand for pre-re-registration audits, with a particular focus on preparation and transition support to the new Standards for RTOs 2025.
Conclusion
With new regulations, shifting workforce demands, and evolving educational priorities, businesses are being forced to adapt quickly. Many are seeking flexible staffing solutions and ways to balance costs with revenue.
The demand for specialised learning designers is growing as organisations work to enhance student engagement and update their training materials. Providers are focusing on efficiency and cost reduction, adopting new technologies to improve quality and reduce risks.
Navigating these changes requires agility and smart planning. At Edutemps, we're committed to supporting organisations through this complex landscape, helping the VET sector not just survive but thrive amidst these shifts.