BUDGET GIVES BOOST TO TRADES TRAINING

The 2020 budget announcement saw Finance Minister Grant Robertson share some sobering numbers, reflecting just how much and how long Covid-19 may affect the NZ economy. However, one silver lining for the building industry was the $1.6bn Trades and Apprenticeships Training Package

Apprenticeships in ‘critical industries’ such as building and construction will become free for the next two years, as of 1 July 2020, while employers will be given financial support to carry out training. Those are just two parts of the training package expected to help people obtain trade training, according to Education Minister Chris Hipkins.

“As we emerge from this health crisis, it is important that we now invest in training and education for people who might have lost their jobs, or who want to move into a different sector where prospects are better,” Hipkins said.

The 1.6bn package includes the following:

• $334m of funding for additional tertiary education enrolments.
• $320m of targeted investment support for free trades training in critical industries over the next two years, to help people who have lost their jobs retrain, and allow new employees in some essential services to train on the job. This will include courses linked to industry skills needs – such as building and construction, agriculture, and manufacturing – and vocational courses such as community health, counselling and care work. The fund will be available from 1 July, 2020.
• Up to $412m support for employers to retain and keep training their apprentices to provide continuity.
• $276m funding for Workforce Development Councils and Regional Skills Leadership groups, to be established to give industry and regions a greater voice and help them respond to Covid-19.
• $141m to support high-quality tertiary and trades education.
• $32m increased funding to meet demand in Trades Academies.
• $50m for a Māori Apprenticeships Fund.
• $19m for group training schemes to retain apprentices.
• $26m operating and capital for a new online careers advice system.

INDUSTRY RESPONSE

Chief Executive of Building Construction Industry Training Organisation (BCITO) Warwick Quinn congratulated the Government and said the real strength lay in recognising the various sides of the training industry.

“The residential sector is by far the largest training ground for construction skills, and construction firms having work is critical to apprentice numbers,” said Quinn. “To this end, the [building of an] extra 8,000 new public and transitional homes, and the Warmer Kiwi Homes package, is a nod to help maintain the supply of work and drive skill demand by employers, who will also be supported if they take on apprentices,” said Quinn.

Historically, the building industry has not been able to escape negative effects from a recession (such as the 2008 global financial crisis, Canterbury earthquakes, and the 1987 stock market crash). However, Quinn said: “the core challenge for the construction sector is retaining apprentices in the system. This package goes a long way towards breaking the ‘boom and bust cycle’ and keeping talent in the system.”

He also said that, despite unprecedented times, it is still a great time to enter trades.

“There will be roles available, and it’s not all about being ‘on the tools’. As people look to their next career move, the building and construction sector offers a range of opportunities.”

EASING FINANCIAL PRESSURES

Auckland residential building company Shore Build has a strong pipeline of work. Its director Ash Hare says that the $412m of support for employers will be a big help for businesses in need, but the $320m towards fees free training will do more for his business, which has nine apprentices. “

For most apprentices, they’re typically not on big wages for the first couple years. On top of that, they have huge costs living in areas such as Auckland with high rental prices, transport costs and other general needs,” said Hare.

“By eliminating the annual fees that come with training, it helps alleviate the financial pressure, so workers can focus more on their learning.”

Hare said he was unsure how much the package would act as a catalyst for people to join the trades, but believes those who have always been interested will now have an easier time doing so.

“The younger generation is different and views trades in a way that is less attractive than other industries. However, there are those who have it in their blood, and others who are on the fence and deliberating if they are ready to take a leap into a sector like building and construction. I don’t see the training package incentivising uninterested individuals to join, but it may provide the final encouragement needed for those who need a little push,” Hare said.

Details on how each slice of funding will be implemented are yet to be released. Under Construction will provide an update as more is revealed in the coming weeks.