Building Australian ICT skills

Transcription

1 Building Australian ICT skills Report of the ICT skills foresighting working group

2 ISSN Commonwealth of Australia 2006 This work is copyright. Apart from any use as permitted under the Copyright Act 1968, no part may be reproduced by any process without prior written permission from the Department of Communications, Information Technology and the Arts. Requests and inquiries concerning reproduction and rights should be addressed to: The Commonwealth Copyright Administration Attorney-General s Department National Circuit BARTON ACT 2600 Or posted at This report has been produced by the Australian Department of Communications, Information Technology and the Arts.

3 Building Australian ICT skills Report of the ICT skills foresighting working group in order to realise the predicted productivity benefits it will be necessary to support an appropriate level of investment in skill formation and in ICT related R&D The introduction of new ICT technologies involves an extensive learning process that generates significant knowledge and innovation... Forecasting Productivity Growth 2004 to 2024, DCITA, 2006

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5 Contents Executive summary...1 Key findings and recommendations...5 Industry leadership...7 ICT labour market intelligence...7 Upgrade of the IT Contract and Recruitment Association placement data collection...8 Access to information on ICT skills, occupations and careers...8 ICT workforce retention, retraining and up skilling...9 ICT workforce attraction...9 Research on ICT skills in schools...10 Background Building ICT Skills as a Strategic Priority Formation of the ICT Skills Foresighting Working Group...13 The Key Strategic Role of ICT in Australia s Economy ICT as a major driver of economic growth Technology trends The Structure of the Australian ICT Industry...18 Major ICT labour trends and issues ICT Employment The changing nature of ICT employment Demand for non technical ( soft or employability ) skills...27 Role of Education in ICT skills supply ICT skills development in schools...32 Career Advice Australia Role of the VET sector in ICT skills development...33 VET in Schools program...33

6 4.3 Role of Universities in ICT skills development...34 University ICT course enrolments...35 ICT graduate employment Articulation of course pathways between university and VET sectors...36 Skills development in the marketplace The role of employers...39 ACS ICT staff training survey Outsourcing and off shoring Skilled migration...41 Future ICT skills demand Challenges and issues in ICT skills foresighting Forecasting and technology trends ICT skills forecasting in Australia Modelling the future Current modelling...47 The future ICT professional...49 Conclusion...53 Appendices...57 Appendix A...59 ICT Skills Foresighting Working Group Membership and Terms of Reference...59 Appendix B...60 Overview of the ICT industry in Australia...60 Appendix C...62 Overview of ICT employment in Australia...62 Appendix D...73 Overview of ICT Skills Supply in the Higher and Vocational Education Sector...73 Endnotes...79

7 Executive summary

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9 Building Australian ICT skills Executive summary Targeted and decisive action is required to enhance Australia s level of information communication technology (ICT) skills and capability in order to maintain competitiveness and maximise the potential of ICT generated productivity growth across all sectors of the economy. Research by the Department of Communications, Information Technology and the Arts and the Productivity Commission has demonstrated that ICT has played a major role in Australia s productivity growth in recent years, highlighting its potential to support further sustained growth. Australia must ensure that these productivity gains are secured and built upon by increasing ICT labour force participation levels and building the ICT skills base. A highly skilled ICT workforce is the key to business productivity improvement through innovative use of ICT. This in turn provides businesses with the capability to compete successfully for export opportunities. The ICT Skills Foresighting Working Group, chaired by Keith Besgrove, Chief General Manager, Information Economy Division of DCITA, has analysed prevailing trends and identified a number of major inhibitors which threaten Australia s future ICT skills development, productivity gains and competitiveness. These are: inadequate coverage and access to quality data on demand for skilled ICT occupations; poorly defined systems of classifying occupational skills leads to gaps and inconsistencies in available data series; apparent declines in industry investment in workforce retraining and up skilling; flow on effects within the ICT industry of intergenerational social and demographic factors, such as the ageing workforce, changing workplace attitudes and generational patterns of work; outmoded and negative perceptions of ICT occupations and careers due to a poor understanding in schools and across the community of the diversity of ICT occupations and opportunities; evidence of a tightening ICT labour market and the emergence of recruitment difficulties for some ICT skills; falling entry level job numbers for new ICT graduates and a marked decline in ICT course enrolments in the university and VET sectors all suggest a declining pool of local ICT workers in the medium to longer term; the variable nature of ICT, over time and across industries, that requires ICT professionals to regularly redefine and reassess their roles, functions and skill requirements; and lack of multi jurisdictional cooperation in regard to the issues outlined above. Unless these issues are adequately addressed they will lead to a severe constriction in the supply of skilled ICT workers and increase the risk of sustained skills shortages. The recommendations in this report suggest key areas to be addressed by government, industry, and education and training providers. Working together to improve the way ICT is represented to parents and young people, to encourage higher levels of ICT workforce participation and to improve understanding of the nature of ICT related work throughout the economy.

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11 Key findings and recommendations

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13 Building Australian ICT skills Key findings and recommendations Industry leadership One of the major issues identified by the Working Group was the lack of public and private sector cooperation on many of the issues challenging the ICT industry. While a vast amount of data was available on the issue of skills across the ICT industry, there was no evidence to suggest it was being coordinated adequately or effectively. The recent participation Summit also came to the conclusion that efforts being made by individual organisations would be maximised if they could be aggregated and managed under a single industry leadership group. Recommendation 1 The Working Group recommends the formation of an industry leadership group to develop and facilitate improved ICT information and participation in ICT occupations and careers. ICT labour market intelligence There is currently a lack of consolidated useful data and information on ICT skills market intelligence. This, along with the poor dissemination of the detailed information which is available, prevents labour market participants gaining a well informed understanding of the ICT skills market and future skills demand. The Online and Communications Council and the PartICipaTion Summit also identified shortcomings in current statistical collections and access. Improved information on skills in demand and ICT occupations and careers are needed by industry, employers, ICT professionals, students and education and training providers. This information will enhance training and career planning, course and curriculum development, and assist government policy development. Recommendation 2 The Working Group recommends that the proposed industry leadership group take on improved market intelligence as one of its main activities and work with government to: assist industry to implement a national ICT nomenclature and job description framework consistent with the new Australian and New Zealand Standard Classification of Occupations (ANZSCO) occupational classification; and adapt and implement policies being established overseas to improve information on skills in demand and thereby assist government policy development.

14 Building Australian ICT skills Upgrade of the IT Contract and Recruitment Association placement data collection The IT Contract and Recruitment Association (ITCRA), in conjunction with Multimedia Victoria, has established an internet based data collection of IT placements with data supplied by 32 of its members. The data is currently published for Victoria only. However, with a relatively small effort the data collection process could be greatly improved to align the data with the new ANZSCO occupation classification and published for all states and territories. Recommendation 3 The Working Group recommends that the Australian Government fund the establishment of an open access National ICT Skills Tracking and Monitoring System based on the Multimedia Victoria/ ITCRA model. Any information collected should be presented in a manner consistent with recommendation four. Access to information on ICT skills, occupations and careers There is currently a lack of public access to data about the ICT skills labour market, largely due to the poor dissemination of the quality data already available. The new Skills Australia (web/online) portal being developed by DEST and DEWR appears to be the most obvious initiative to address this issue. The website will provide information on skill shortages, industry skill needs, future employment growth and education, and training opportunities across all occupations. It will include a specific ICT module. Recommendation 4 The Working Group recommends that the Australian Government work with key stakeholders to improve access to quality data and analysis on ICT skills and jobs by aggregating and maintaining weblinks and data on the ICT skills market. This would include analysis of ICT labour market trends and projections as well as information on career structure on an upgraded Skills Australia website.

15 Building Australian ICT skills ICT workforce retention, retraining and up skilling There is a perception that industry investment in ICT workforce retraining and up skilling has declined, but there is little data on this important issue for either the ICT industry or the broader ICT labour market. The combined impacts of the ageing workforce, changing generational patterns of work and the apparent failure of many employers to upgrade workplace skills could mean that Australia risks being unable to sustain key ICT based economic capabilities, operations and services in the future. Recommendation 5 The Working Group recommends that the Australian Government, in cooperation with industry stakeholders, fund additional research into staff retention, retraining and up skilling issues and practices. This could include: ACS and AIIA undertaking regular review of investment in and attitudes towards staff retention, retraining and up skilling as part of their regular surveys and consultations with members; CompTIA Australia, possibly through the new IT Pro Australia website, undertaking a survey into investment in and attitudes towards vendor training; and DEWR including questions in its ICT skills shortage surveys on employer investment in and attitudes to staff retention, retraining and up skilling. ICT workforce attraction The Working Group identified as a major concern an outmoded and negative perception of ICT occupations and careers, and a poor understanding in schools and across the community of the diversity of ICT occupations and opportunities. The Working Group concluded that there is an urgent need for action to address negative perceptions of ICT careers in the community which lead many young people and those who influence their career choices (such as parents, teachers, career advisers) to underestimate the opportunities available in ICT and thus to turn away from considering a career in ICT. Recommendation 6 The Working Group recommends that the Government work with industry, the education and training sector and State/Territory governments to re focus the way ICT is presented by: jointly funding, developing and delivering a National ICT Awareness Campaign consisting of a national communications campaign addressing negative perceptions of ICT and highlighting the opportunities and attractiveness of ICT careers; enhancing ICT careers promotion and outreach efforts to schools by leveraging the new Career Advice Australia (CAA). In particular this would include: forming strong links with the network of National Industry Career Specialists (NICS) and Regional Industry Career Advisers (RICAs); providing them with information and advice on the modern ICT workplace, jobs and careers and ICT skills in demand and in shortage; and promotion and marketing of the ICT module of the Skills Australia website as part of the above.

16 10 Building Australian ICT skills Research on ICT skills in schools The Working Group expressed concerns that the quality of ICT teaching in schools, and the outmoded image of ICT work presented, may be deterring students from considering ICT as an option for further study at university/tafe and as a career choice. This was an issue that also received considerable attention at the participation Summit. In particular the Working Group raised concerns about the teaching of ICT as a specialised subject in the later school years. The Working Group considered that the focus should be on teaching fundamental ICT principles, useful as a foundation for further study, rather than on specific programming areas. Recommendation 7 The Working Group recommends that action be taken to review and enhance the teaching of ICT in schools. The working group suggests that: government fund detailed research on school ICT teachers to assess the characteristics (e.g. gender, age), qualifications and challenges of ICT secondary and high school teachers; and ICT industry bodies and leading ICT vendors work with education agencies and professional bodies to assist and support school ICT teachers and teaching staff in universities and TAFEs.

17 1 Background

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19 Building Australian ICT skills Background 1.1 Building ICT Skills as a Strategic Priority Building and maintaining a sustainable and world class ICT workforce and ICT skills base is necessary to meet the current and future needs of the economy and ensure that Australia continues to achieve strong productivity, economic and social benefits from ICT. As part of its fourth term commitment the Australian Government recognised the need to support future economic growth by addressing Australia s growing demand for skilled labour and the challenges of skills shortages and mismatches. Research by the Productivity Commission 1 and the other government bodies 2 predicts future declines in labour force participation as the Australian population ages. Increasing labour force participation through ongoing skills development for young and prime age workers, and ensuring older workers maintain their skills and employability are a major priority. In its 2004 election policy statement, Information Technology: Connecting an Innovative Australia, the Australian Government highlighted the reskilling of ICT workers as an important issue. Furthermore, Online and Communication Council Ministers 3 agreed at their August 2005 meeting to collaborate on a more coordinated approach to Australia s ICT capability, particularly ICT skills, and to improve the quality and range of key data 4. These commitments recognise that Australia faces an ongoing challenge to ensure that the available ICT workforce is in line with the changing needs of the ICT industry as well as industries across the Australian economy. 1.2 Formation of the ICT Skills Foresighting Working Group In February the Minister for Communications, Information Technology and the Arts, Senator the Hon Helen Coonan, established the ICT Skills Foresighting Working Group to contribute to the portfolio s consideration of the Australian ICT labour market. The Working Group analysed the current trends and potential developments of ICT technologies, the applications of technologies, and their implications for the ICT workforce and its skills development. This included a review of the ability to accurately forecast future ICT workforce demand, the fit between industry skill needs and existing training, and possible options for better forecasting the future workforce needs of industry. Economic Implications of an Ageing Australia, PC For example: Workforce Tomorrow Adapting to a more diverse Australian labour market, DEWR Online and Communication Council is made up of Federal and State Ministers responsible for Information Technology. Joint Media Statement, Twelfth Ministerial meeting of the Online and Communication Council, 24 August 2005: p.2 Building Australia s ICT Capability 5 Media Release, Building future skills in Australian ICT, February /media/media_releases/building_future_skills_in_australian_ict2

20 14 Building Australian ICT skills The Working Group focused on ICT skills development directly related to the ICT industry as well as the ICT skills needed in other industries in the economy. However, the Group did not concern itself with broader basic ICT skill levels required in business, government and by people in the Australian community. In addition, issues such as off shoring and skilled migration were not given detailed attention as they were areas which fell outside of the Working Group s terms of reference. The members of the Working Group as well as its terms of reference are provided at Attachment A.

21 2 The Key Strategic Role of ICT in Australia s Economy

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23 Building Australian ICT skills The Key Strategic Role of ICT in Australia s Economy 2.1 ICT as a major driver of economic growth There is a strong consensus both internationally Organisation for Economic Co operation and Development [OECD] and in Australia that ICT is a major driver of economic growth and productivity, principally through its capacity to enhance efficiency and innovation. ICT provides the communications infrastructure and the means to access and store data and to manipulate it to provide information critical to business, government, research, education and community operations. Innovations using ICT that capture, transmit and display data and information electronically have become a central ingredient to the growth of national productivity. Over the past two decades, up to 85 per cent of productivity growth in the manufacturing sector was due to technology, of which ICT was a significant part. 6 Recent research by DCITA, Productivity Growth in Service Industries 2005, has found a strong correlation between productivity growth and ICT use and intensity. ICT intensive services that have experienced high productivity growth include communications, electricity, finance and wholesale trade. ICT transformation and innovation is a broader social process encompassing technological, organisational and cultural change. The DCITA commissioned study Achieving Value from ICT: Key Management Strategies demonstrated that regardless of the business size, organisational structure or industry, those that combine their ICT investments with good management practices achieve the greatest value from their ICT outlays. The essentials of good ICT management consist of being ICT aware, possessing a strong change management philosophy, a strategic organisational culture, and providing effective leadership. The rising role of ICT in economic activity has made it critical to the achievement of Australia s national goals, for example, future economic growth, national security, dealing with demographic change, environmental management, education and health. As ICT is a collection of many constantly evolving technologies, the continuous process of technology migration and the emergence of new solutions require frequent renewal of the economy s technical know how. 2.2 Technology trends Business demand for ICT and ICT innovation are interdependent, and ICT take up, infrastructure capability and level of integration in turn influence the adoption of other ICT technologies. Current ICT technology trends can be grouped into those related to infrastructure and those related to the business enterprise. Infrastructure technologies experiencing the highest growth are broadband networks and wireless systems, which form the communications backbone of business enterprises. Achieving Value from ICT: Key Management Strategies, DCITA data/assets/pdf_file/25466/achieving_ Value_from_ICT_ _Key_Management_Strategies.pdf

24 18 Building Australian ICT skills Enterprise technologies that businesses are investing in are those that run applications internally and manage linkages with other businesses, such as e commerce and supply chain systems (e.g. Enterprise Resource Planning). Developments and improvements in core ICT technologies such as processor speeds, miniaturisation and bandwidth are fuelling rapid changes in the capabilities of the communications platforms and the services they provide. For example, digitisation is blurring the boundaries between communications infrastructure and services such as television and telephony. Devices which attach to these platforms, such as 3G mobiles and games platforms, are acquiring functionality which cuts across traditional industry distinctions. ICT is facilitating change in business models and allowing new business models to emerge which have implications for skills demand. For example, the customisation of software is reportedly declining in favour of proven off the shelf business processes. 2.3 The Structure of the Australian ICT Industry The Australian ICT industry is a source of internationally competitive products and services that contributes to a significant percentage of productivity growth across the Australian economy. In the value of Australian production in ICT goods and services by ICT specialist firms is approximately $48.7 billion, of which $2.9 billion was ICT goods, $16.5 billion computer services and software, and $29.3 billion telecommunication services. More detail is provided in Attachment B. ICT Research and Development (R&D) is also important to future economic and employment growth. Most sectors of the economy spend a significant portion of their R&D effort on ICT R&D (Table 1). This figure as high as 77 per cent in the finance and insurance sector. The supply of high level research skills is a fundamental input to the success of industry research and these skills are most fully developed by post graduate research training.

25 Building Australian ICT skills 19 Table 1 Industry ICT Employment for Industry Sector Aug 2005 Number employed % share ICT Capital Expenditure Share of Industry Sector Expenditure (%) ICT R&D Share of Industry Sector R&D Expenditure (%) Mining Agriculture, forestry and fishing * Transport and storage Manufacturing Construction Retail Trade Health and community services np Wholesale trade Accommodation, cafes and restaurants np Property and business services Personal and other services np Government administration and defence Education Cultural and recreational services np Electricity, gas and water supply Communication services Finance and insurance All industries Source ABS collections. Notes *: Data not collected np: Data not published

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27 3 Major ICT labour trends and issues

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29 Building Australian ICT skills Major ICT labour trends and issues 3.1 ICT Employment In February 2006, Australia employed approximately ICT practitioners across all sectors, representing 3.6 per cent of the total workforce. The Australian ICT industry accounts for some 40 per cent of ICT professionals. The remaining 60 per cent are spread throughout ICT user industries across the economy. This reflects the development of a broader ICT capability, greater reliance on ICT based services and integration of ICT in virtually all economic activity. Intensive ICT user industries include the communications, electricity, mining, manufacturing, financial services and services sectors (Table 1). More detail is provided in Attachment C: Overview of ICT employment in Australia 3.2 The changing nature of ICT employment The roles that ICT professionals perform are becoming increasingly diverse and cause constant change in the job tasks within ICT occupations. The work of an ICT professional can now encompass: management of significant ICT contracts with major vendors; development of application oriented solutions; implementation, management and support of ICT systems; and selling of ICT products and services; and undertaking consultancies. The skills required vary considerably. They range from very specific in depth technical knowledge and expertise to others where broader technical ability is needed alongside good interpersonal and project management skills. Converging technologies and capabilities driven by ICT, and consequent changes in markets and business models, is continuing the rapid and spreading adoption of ICT technologies by business and governments. Distinctions between old and new economies are now blurred as many older industries are becoming hybrid industries with a strong ICT dependence. It is increasingly difficult to distinguish between ICT service and hardware providers and companies providing specialist electronic hardware or software solutions. For example, in the areas of robotic equipment or toll related financial services the outputs are predominantly ICT based yet wouldn t be considered as ICT output in the traditional sense. As ICT is increasingly embedded in all aspects of business and government operations, ICT professional skills and competencies are becoming core elements of many occupations. This trend has increased the need for a clear understanding of the fundamentals of business and markets as a necessary part of the ICT professional s skills. As ICT professionals now work in multi disciplinary teams dealing with complex problems, they also require problem solving abilities, negotiation skills and a capacity to understand the needs of customers and project colleagues.

30 24 Building Australian ICT skills Figure 1 seeks to illustrate the multiple career pathways and influences on skills supply for the ICT workforce. Figure 1: Key Pathways and Influences on ICT Skills Supply

31 Building Australian ICT skills Demand for ICT skills Figure 2 shows the indexed long term employment growth of ICT professionals compared to all professional occupations and all occupations. It demonstrates the significant growth the ICT profession has undergone since Figure 3 shows the breakdown of this growth amongst the three largest ICT occupations and demonstrates that computing professionals have had the most substantial increase. Figure 2: Long term employment growth for ICT Professionals*, compared with Professionals and All Occupations: 1986 to Professionals ICT Professionals All Occupations Aug-86 Aug-88 Aug-90 Aug-92 Aug-94 Aug-96 Aug-98 Aug-00 Aug-02 Aug-04 *Source: ABS Labour Force Survey IT Managers and Computing Professionals (DEWR trend data)

32 26 Building Australian ICT skills Figure 3: ICT Professionals Employment February 1996 to February ICT Professionals 150 Computing Professionals Computing Support Technicians 25 Information Technology Managers 0 Feb-96 Feb-97 Feb-98 Feb-99 Feb-00 Feb-01 Feb-02 Feb-03 Feb-04 Feb-05 Feb-06 Source: DEWR 2006 In the lead up to 2000 (Y2K) ICT employment was driven by the pressure to upgrade computer software combined with strong growth in ICT investment by communication service and the finance and insurance industries. Also in 2001 the world wide ICT industry suffered a sharp contraction in demand in many markets and this led to a substantial restructure of large international firms such as Nokia, Motorola and Ericsson. Australia felt some of the repercussions of this development. Following a strong period of growth between 1994 and 2003, the slowing of demand for ICT products and services led to a levelling out and then fall in growth of professional ICT in February The strong rise in the past year has taken employment of ICT professional to a new Australian peak with ICT professionals employed in February There are many and varied reasons for skill shortages in ICT. In particular the demands for specific skills related to specific technologies can happen with both new and outdated technologies. A sudden lack of employees with skills in new technologies can outpace the supply if enterprises and governments suddenly adopt new technologies and their applications. Equally, businesses using older ICT technologies can sometime find the recruitment of practitioners difficult because the needed skill sets are becoming rare. Several technologies are often employed to develop a solution, and increasingly they are being combined to inject innovation into products and services provided by older industries and other fields of research. Many industries and areas of research are becoming increasingly dependent on the advances in ICT to support their leading edge research and applications. For example, the convergence between nanotechnology, biotechnology, information technology and cogitative science is widely acknowledged as an important area of research which is expected to yield significant innovation.

33 Building Australian ICT skills 27 Each technology has a pool of skills related to it, ranging from electronic hardware to software and systems know how. There are well over a hundred recognised and evolving ICT skills currently in demand in the Australian labour market. These skills will continue to change as business, government and consumers find new ways to improve productivity and make product and service innovations. Furthermore, demand for ICT skills changes as ICT tools and enhancements change business models and firms grow and move up the value chain. This stimulates demand for different skills and skill sets. These systemic changes in business can create skill deficiencies or skill gaps. A mismatch of skills demand and supply can result in there being both ICT unemployment and skills shortages (structural unemployment). Outsourcing and off shoring, the continuous growth of ICT products and services, and the diffusion of these new technologies to other industry sectors contribute to these dynamic changes. The forecasting of potential skill shortages is particularly difficult because of the lack of fine detail in the data on ICT in the labour market. The DEWR annual Australia wide ICT skills shortage survey is as comprehensive as possible in analysing ICT skills in demand. In undertaking the survey in 2005 DEWR contacted 90 recruitment agencies and 124 employers. Any improvements in the quality of data obtained from these recruitment agencies and employers will assist in improving the quality of the survey and its overall findings. 3.4 Demand for non technical ( soft or employability ) skills Employers of ICT professionals are now requiring these professionals to possess a broader skill set in addition to technical expertise. A report prepared by the Austrian ARC Systems Research Centre for the European Union, The Human Resource Factor in the Information Society Future, reviewed a wide range of sources and identified a number of trends as characterising the emerging needs of the European ICT market. Significant trends identified include: increasing need for employees with broader skills sets, in addition to technical expertise; businesses identifying ICT tools with the potential to positively influence productivity; increasing demand for more specialised technical skills; rapid change means that ICT professionals need to be flexible and open to continuous learning; organisational structures and workplace cultures require flexibility and responsiveness to facilitate learning; and the rate of growth of the industry means that more skills of all kinds will be needed.

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35 4 Role of Education in ICT skills supply

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37 Building Australian ICT skills Role of Education in ICT skills supply It is now generally acknowledged by governments, leading industry and professional associations, employers and the education and training sector that there is an urgent need for improved targeting of information and advice on ICT courses and careers to school students. A recent Victorian Government study, Attitudes to ICT careers and study among year old Victorians 8 found that: 72 per cent claim that they don't know very much about ICT courses.offered; 86 per cent agreed that specialising in ICT opens doors to careers in many types of industries or businesses; 40 per cent of interviewees showed at least "some interest" in pursuing an ICT career, with 10 per cent expressing a "strong interest"; 59 per cent agreed that the greatest disincentive to working in ICT was being stuck in front of a computer all day; 6 per cent plan to do an ICT course at university but none of these are female; the major influences on decisions related to young people undertaking courses (in the order of influence are word of mouth, parents, teachers, careers advisers, friends, TAFE and university open days, careers expos and careers guides; and when asked about the best methods to promote ICT careers to young people: 94 per cent considered work placements or job experience in an ICT company would be effective; 90 per cent considered schools visits and information sessions by young people who have been successful in ICT would be effective; and 90 per cent considered competitions sponsored by ICT companies to encourage innovation and technology in schools or universities would be effective. Strategies to improve advice on ICT courses and careers to school students could include improved research and marketing and new approaches in order to: address commonly held public misconceptions about the nature and scope of ICT work and occupations; and improve the understanding of school students at all levels, and of teachers, career advisers and parents, of potential career and study opportunities in ICT, in particular that approximately 40 per cent of ICT professionals work outside of the ICT industry. The Working Group concluded that there is an urgent need for action to address the negative perception of ICT careers in the community which is turning many young people away from considering a career in ICT.

38 32 Building Australian ICT skills The supply and development of ICT skills within the education sector is influenced by a multitude of factors, the principle being: the capacity and role of formal education, training institutions (schools, universities and VET) and vendor training in skills development; the ability to attract new entrants into ICT education/training and into ICT careers; ICT course enrolments in universities have a lagged impact in four years time when currently enrolled students graduate; graduate employment which is the first step to building experienced practitioners; and low demand for graduates can discourage future course enrolment. The following sections of this report describe these major sources of ICT skills supply and further explore some of these issues and concepts. 4.1 ICT skills development in schools The development of basic ICT literacy skills for students and teachers in schools falls outside of the Working Group s terms of reference. However, the Working Group identified as relevant the related issues of: the overall level of understanding by teachers in schools of ICT jobs and careers; and the quality of teaching of VET based ICT subjects in schools. These two issues in particular were identified as having a possible impact on students understanding and attitudes to considering further study or employment in ICT related areas. The Working Group noted that there are already significant commitments and initiatives at the Australian and State Government levels targeting these areas, in particular: Partnerships in ICT Learning is a project that will equip teachers to focus on the technology related needs and challenges for different groups of Australian teachers; Making Better Connections project focuses on teachers professional development in their use of ICT; Teaching Australia Australian Institute for Teaching and School Leadership supports and advances the effectiveness and standing of the teaching profession. ICT will be addressed in this context; and Australian Government Quality Teacher Programme focuses on the renewal of teachers and leaders skills and understanding within a range of priority areas including literacy, numeracy, mathematics, science, and technology (including ICT), vocational education in schools and the National Safe Schools Framework. However, the Working Group found that while considerable research has been funded into the generic ICT skills of school teachers, no specific research has been undertaken into the skills and understanding of school teachers who teach ICT to students through vocationally oriented ICT courses, including as part of the VET in Schools program. The Working Group also noted the submission 9 made by the Australian Science Teachers Association to the DEST audit of science, engineering and technology skills. The submission stated that the teaching profession was facing particular challenges in relation to the aging population of science teachers ASTA Submission to Audit of Science, Engineering and Technology Skills

39 Building Australian ICT skills 33 adapting to ICT within the curriculum. In addition the submission stated that there was a need for the provision of financial and infrastructure support from government and industry to broaden the reach of existing professional learning opportunities available to teachers. Career Advice Australia The Department of Education, Science and Training (DEST) presently funds a range of career development and advisory initiatives targeted at schools across Australia. The Working Group noted that it would be desirable for leading ICT industry and professional bodies to work with DEST through these existing initiatives to improve understanding and promotion of ICT careers to schools, teachers and career advisers. There is an ideal opportunity for leading ICT industry and professional bodies to work with DEST on the early development of the recently announced Career Advice Australia initiative, in particular the new National Industry Career Specialists. 4.2 Role of the VET sector in ICT skills development The vocational education and training (VET) sector plays a primary role in the provision of training for ICT workers. VET is delivered within a range of training environments, including TAFE institutes, a range of schools, agricultural colleges, universities, community education providers and private providers with a focus on the teaching of skills required in the workplace. The VET sector provides a wide range of opportunities for a diverse student population and demand. IT in the VET system incorporates Computer Science, Information Systems and other Information Technology. A new National IT Training Package (ICA05) has been endorsed by industry and replaces the former National IT Training Package (ICA99) which was developed in The new framework, developed in close consultation with the ICT industry, provides a far more highly developed and structured system of qualifications and pathways to better reflect the current and emerging ICT skills needs of industry. In 2005 NSW TAFE developed an associate degree in cooperation with several universities and industry associations, including the Australian Information Industry Association (AIIA). The associate degree is being piloted initially with overseas students and aims to be comparable with two year university courses. NSW TAFE is negotiating to ensure students, who complete the associate degree and then want to move on to a three to four year university degree, can secure significant credits for the work already covered. 10 Also in 2005 Box Hill Institute, a Victorian TAFE institute, received accreditation to deliver three degrees in the ICT industry: a Bachelor of Computer Systems (Networking); an Associate Degree in Computer Systems (Networking) and an Associate Degree in Software Development. This was a first for the TAFE system for a TAFE Institute to be able to offer a Bachelor program in its own right serving the ICT sector. Each Degree had industry leading the design phase and focuses being applied and practical in line with industry specifications. Further details in regard to the Vocational Education and Training sector are provided in Attachment D. VET in Schools program VET in Schools is defined as a program which allows students to combine vocational studies with their general education curriculum. Students participating in VET in Schools continue to work towards their Senior Secondary School Certificate, while the VET component of their studies gives them credit towards a nationally recognised VET qualification. 10

40 34 Building Australian ICT skills Outcomes from students studying ICT as part of the VET in Schools program provide mixed results. Analysis of data obtained from DEST (May 2004 survey data) on student participation in and outcomes from the VET in Schools program found that: Of all students participating in structured workplace learning (i.e. work placements under the program), 11 per cent were in ICT work placements and of this number 33 per cent were female students. ICT had the highest outcomes of students going onto either full time work or study (77 per cent) post placement but with the main outcome related to full time study (55 per cent) and 22 per cent onto full time work [the data does not specify whether or not the full time study is ICT related]. Female ICT students more likely than male students to go onto full time study rather than full time work. The overall trend in participation and outcomes from 2001 to 2004 has remained stable. The program appears to provide a pathway option for some students into further study although the precise nature of the study cannot be determined from the survey data. 4.3 Role of Universities in ICT skills development Universities are a major source of new ICT professionals. However, the rapid rate of technological change creates challenges for universities to keep pace with the skills needed to build and maintain new technologies. Traditionally, the cycle for review, development, and implementation of new curricula takes five to eight years. This is severely misaligned with changing technology cycles which can be counted in months rather than years. This nexus, between the capabilities of universities and other higher education bodies and industry needs, relies on effective linkages and collaborative approaches between industry and universities to avoid misalignment in the demand and supply cycles. A number of universities have openly stated their preference for focussing on providing foundation skills to ICT students, rather than focussing on specialised narrow skills, which they argue might quickly become redundant as market demand changes. The conclusion drawn by leading academics working in the ICT field is that it is not possible for universities to respond to narrow, short term technical specialisations. This is compounded by the fact that only four universities have IT Faculties (Monash, UTS, QUT and Wollongong). Of the remaining 39 universities ICT is often located in a department or school within the Faculty of Engineering or Business. There is debate about whether freestanding ICT Faculties will be sustainable in the future given the strong trend towards ICT graduates with a strong understanding of business. Indeed, even those universities with freestanding ICT Faculties are pursuing more broadly based multidisciplinary ICT programs and degrees. For example, the UTS has a combined technology business degree, where a full time student undertakes two business subjects and two ICT subjects. However the capacity of most universities to establish alternative business models to respond to short term specialisations is currently severely limited, given competition for funding with other disciplines such as engineering and business. Even universities with purpose built ICT Faculties find the choice between their core teaching business and more market driven short courses is constrained by available teaching staff and resources which are primarily dependent on undergraduate enrolments. The lack of flexibility is considered to be particularly acute for many universities in an environment of constrained funding levels, falling ICT course enrolments and increased government reporting requirements. Rather than seeking to predict skill demands and shortages, students are given the opportunity to gain experience in a variety of technology platforms through their course work. This way, students not only gain experience in the Microsoft operating system but also open source software such as Linux.

41 Building Australian ICT skills 35 Practical implementation skills and experience in current technologies is emphasised through lab work, and this means that over time the primary skills specialization for different student intakes has shifted from Cobol to C+ to Java. Some universities emphasise industry work placement as a core part of the degree, with a four year degree offering one year in industry (sometimes referred to as sandwich courses). Several leading universities have reported that factors such as the industry downturn in , and changes to higher education funding arrangements, has made it difficult to maintain industry placements as a compulsory element, and three year degrees are also offered which excludes the industry placement component. Many universities are making provision for more complex arrangements in cross disciplinary degrees, such as combining ICT units with studies in commerce, languages and health sciences to enable wider choices which may raise the employability skills of graduates. Project management in particular is receiving a strong focus. Some universities are also recognising that for graduates to be marketable in an international ICT employment market, they may need a good understanding of the regulatory regimes and IP rules in different overseas jurisdictions. This suggests an increasing internationalisation of ICT curricula. There is also likely to be increased need for students to be more culturally sensitive and globally aware in order to be effective in overseas ICT markets. A view from some in the ICT industry is that while universities are coming to terms with the need to develop undergraduates broader business and interpersonal skills that they need to enter the workforce, this is happening slowly in a piecemeal way and a more concerted effort is needed. Universities however consider that they are severely constrained and lack the flexibly to respond to industry and market demands and potential student preferences. This includes legal and funding requirements placed upon them by government when making curriculum and course changes, and the long lead times in preparing information and marketing on new course offerings. University ICT course enrolments University graduates are the major source of new ICT professionals. However the number of students commencing ICT university studies continues to decline. This decline in total ICT enrolments has been due to a general decline in Australian students enrolling in professional courses, and to their selection of other courses. Figures from the NSW University Admissions Centre show first preference applications to study IT in 2006 were down 17.3 per cent. First round offers for IT courses in NSW fell 15 per cent in 2005, after falls of 25 per cent and 24 per cent in 2003 and 2004 respectively. In Queensland, first preference applications for 2006 were down 12.2 per cent and first round offers dropped 49.6 per cent between and The long term trends in other states have been just as evident. For example, in Victoria, the number of students enrolling in IT courses at Monash University dropped from 4716 in 2001 to 2497 in 2006, a decrease of close to 48 per cent. Similarly, enrolments at Melbourne University dropped from 2200 to 1608 between 2001 and Swinburne University experienced a drop of close to 25 per cent during the same period. However, some universities are reporting an increase in students applying for blended courses, that is, courses offering a mix of technology and business. For example, in 2006, Deakin University recorded an increase of about 10 per cent in demand for blended courses offering majors in accounting information systems and other business focused areas. While there are not official projections of the number of ICT graduates from Australian universities, there have been several claims of pending skills shortages.

42 36 Building Australian ICT skills ICT graduate employment Recent DEWR analysis of data on graduate outcomes, drawing on GCCA Graduate Destination Surveys, shows that the proportion of students in higher education computing courses working with the same employer before and after graduation has fallen markedly in the past decade. DEWR noted that this trend is not conducive to strengthening of education work linkages for ICT occupations. Concern has been expressed that off shoring will reduce demand for ICT graduates. Since the industry contraction in 2001, ICT graduate employment has been relatively slow to recover. This is reflected in the starting salaries for computer science graduates, which fell from around fifth highest in 2000 through to 2002, then slipped to ninth in 2003, and then partially recovered to seventh in The salary variances can be tied to large ICT consultancies which cut back on graduate recruitment in downturns, but aggressively seek the top tier graduates as demand for services is expected to rise. In the current upturn in demand, this factor and the perception that there has been some shift back to in house delivery of ICT services, away from off shoring and outsourcing, have been attributed as reasons for the increased demand for graduates. Indeed, data from the Olivier Group, which surveys employment in the ICT market, reported that graduate opportunities continue to rise. For example, in March 2006 Olivier reported that in the previous twelve months vacancies for technology graduates had.risen by per cent. The falling enrolments in ICT courses over the past three years may also be a factor in improving employment opportunities for graduates and may help drive up graduate salaries (see Olivier Job Index November 2005). 4.4 Articulation of course pathways between university and VET sectors There are a number of avenues for enhancing connections between the Higher Education and VET systems, and providing improved skill development pathways and outcomes: Articulation, usually takes the form of students completing or undertaking a VET qualification(s) first and then completing the university qualification to obtain the degree; Credit transfer, consists of either a full or partial transfer between components of existing awards; Joint courses or dual sector awards/programs, require collaboration.in.development.of the course between the two institutions. In order to create opportunities for students to articulate from TAFE to university there is a need for considerable collaboration between the sectors. There are many courses that provide opportunities for articulation. Articulation requires a sequential pathway between qualifications in VET and higher education, allowing students to progress from one qualification to the next, and offering multiple entry and exit points This usually takes the form of 2+2 years, 2+1 years and 1+2 years, where a VET qualification articulates into a bachelor degree. In 2004, DEST agreed to fund an initiative to investigate the impediments to articulation with a particular emphasis on the VET (Vocational Education and Training) and HE (Higher Education) providers in the ICT industry. The project, Impediments to Seamless Articulation, commenced in January 2005, with the final report and recommendations presented to DEST in August The recommendations included further research into existing articulation arrangements with HE institutions that did not provide input to the study, provision of a database tool to map VET and HE programs to each other and a number of pilot projects to test the outcome of better guidance within articulation pathways.

43 5 Skills development in the marketplace

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45 Building Australian ICT skills Skills development in the marketplace Vendor training and training validation through certification is a critical component of technology skill development. It is important for professionals to understand the technology they are using in relation to business planning and development. Working with industries that develop the technology is critical to the formation of skills. It is also important for companies who are purchasing and deploying the technology and services to understand the skills required to protect their investment. For professionals it is critical they have globally recognised ICT industry skills with a direct correlation to the ongoing development of technology and its integration within diverse industry sectors. The Computer Technology Industry Association (CompTIA) launched IT Pro Australia 11 in October 2005 to raise the public profile in Australia of vendor training and to offer improved information and support to ICT professionals seeking to upgrade their vendor qualifications. An ongoing challenge for the ICT industry, in particular vendor companies and CompTIA Australia, is working with the formal education and training sector to better integrate and/or link vendor training and certification with university curriculum and the VET National ICT training packages. 5.1 The role of employers Retraining is an ongoing part of most ICT practitioners' work.experience..ict.is.dynamic and.constantly requires the upgrade of existing skills and new skills to work with the periodic introduction of new technologies. A great deal of the upgrading of skills occurs on the job. In addition, employers may support formal training and practitioners can seek to undertake tertiary studies to build their skills base. ICT courses are offered by TAFE, universities and vendor certified trainers. Some ICT professionals who have been in the IT business for many years may however find it difficult to convert their skill sets. The reported high costs 12 of self financing ongoing skills development can be a potential barrier to skills upgrading for some IT professionals. ACS ICT staff training survey The ACS has recently undertaken a survey, including many of Australia s top ICT employers, to obtain a better insight into attitudes to training of ICT staff. Information was sought on issues such as the main requirements and skills currently seen to be important, and those that will be needed within the next three to five years. The survey has revealed a gap across all technical and non technical areas surveyed, between training identified as being necessary by firms and that being planned For example, in (year), costs for the Cisco Certified Network Associate Program were approximately $1000 per semester.

46 40 Building Australian ICT skills A key message from this is that ICT professionals should not be relying on their employers to supply all their training needs. Because there is a consistent gap across all training areas surveyed, it is reasonable to assume that employers consider that employees should be contributing to their own training requirements around 25 per cent of their own technical training and 30 per cent for training in non technical areas. There are implications in this for ICT employees and firms. For employees, unless they are initiating their own skills update their skill set could be out of date in as little as three to five years. Conversely, employers are likely to have to undertake major retraining programs or spill and fill over the same time frame because current employees will not have the full compliment of skill sets they need for their business needs. The majority of employers surveyed indicated that they believed employees need to look at completely overhauling their skill sets every three to five years, suggesting that this is indeed what is happening. 5.2 Outsourcing and off shoring Greater focus on outsourcing, and in particular off shoring, of ICT services as a means to obtain ICT skills has emerged in recent years, driven by the expectations of access to lower cost services and greater flexibility. Outsourcing to Australian based ICT service companies has existed for decades and influenced the location of ICT skills between service providers and customers. Off shoring has been enhanced and strengthened by the development of digital information and communications technologies and the fall in telecommunications costs. However, off shoring is susceptible to cultural and communications issues. The ICT related activities that lend themselves to off shoring include computer programming, back office functions such as billing and processing and customer services such as call centre operations. The current levels and the pace of growth in off shoring are unclear, though expectations are for off shoring to continue to steadily grow for the foreseeable future. While off shoring has the potential to remove skills shortages it also has the potential to reduce demand for skills in surplus. In December 2004 the Australian Information Industry Association (AIIA) released the report Status of Off shoring Outsourcing in Australia: A Qualitative Study prepared by ITR Principal Mark Hollands. The report canvassed the opinions of senior executives in Australia s leading companies, software and application developers and key ICT policy influencers. One of its main findings was that despite the consistent view that offshore outsourcing threatened many jobs, the potential for new jobs is also significant. Recommendations of the report focussed on assisting displaced workers to retrain and re enter the workforce, to ensure a supply of new workers with the skills required to attract offshore outsourcing to Australia. The Australian Computer Society has also commissioned research 13 in this area which concluded that the dynamic nature of the ICT industry often means that there is very little time for ICT workers to identify and learn new skills, and re skilling ceases to be a priority for some employers. This generally places the onus for re skilling and up skilling on ICT professionals themselves. In addition the report concluded that much of the unemployment and under employment in ICT is caused by people not having appropriate skills mixes. While there are some ICT professionals who have not maintained the necessary skill levels or learned new skills required, this needs to be weighed against years of valuable practical experience and managerial expertise. 13 ACS Policy Statement on Off shoring, May 2004 and Study of ICT Outsourcing and Off shoring in Australia, Whitehorse Strategic Group, May 2004

47 Building Australian ICT skills 41 More recently, one of the world s leading consulting firms McKinsey & Company reviewed the impacts of off shoring on the US workforce 14 and concluded that while the US economy gains from off shoring, companies and governments should do more to help workers cope with the faster rate of job change. 5.3 Skilled migration Obtaining the right balance in the numbers and capabilities of ICT immigrants to meet domestic requirements is a complex question. There are a number of factors which make a perfectly tuned immigration program difficult to achieve, these include: the complexity of the local market place; the lack of current information about skills demands; inconsistent nomenclature; lags involved in immigrant selection; and the difficulty of having immigration officials with sufficient knowledge and experience to match the capabilities of individual applicants with domestic market requirements. However, improving arrangements through the availability of more accurate and current information would allow better operation of immigration arrangements. 14 US Off shoring: Rethinking the Response, December 2005 McKinsey & Company

48

49 6 Future ICT skills demand

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51 Building Australian ICT skills Future ICT skills demand 6.1 Challenges and issues in ICT skills foresighting The concept of foresighting involves identifying possible future scenarios and the impacts of influential factors over time. It offers a way of assembling a big picture view of the possibilities presented by emerging technology set in broader economic, social and demographic contexts. The foresighting becomes very useful for many purposes, such as to aid policy development to help education providers set curriculum and academic places; to help people manage their careers; to aid employers to manage professional development of their workforces; and much more. Foresighting also facilitates the development of a shared community of understanding across a range of stakeholders. This in turn facilitates more meaningful dialogue amongst stakeholders on the issues that will influence future outcomes. As was noted during the Vision 2020 process conducted by the former Australian Communications Authority (ACA), creating foresight improves our capacity to deal with complexity and uncertainty. 15 Effective foresighting facilitates stakeholder understanding of the opportunities, threats and challenges faced, stimulating debate and further research. Foresighting complements forecasting, and the accuracy of foresighting is highly influenced by the quality of forecasting available. Forecasting assists by providing more accurate knowledge about trajectories and related trends and developments, and good forecasting is a highly desirable prerequisite for good foresighting. 6.2 Forecasting and technology trends At first glance using technology trends to forecast future demand for skills may appear to be a promising approach to forecasting future demand for ICT skills. However, the reality is that the research and analysis task is difficult, costly and remains risky as one seeks to develop a reasoned assessment of what is likely to eventuate. Other major constraints on finer forecasting of ICT skills demand are: the size of current skill pools are unknown due to information lags; specific future demands for related skills, and the time frame in which the impacts will occur, are unknown; and there are a diverse number of factors that influence demand for particular skills (eg firm size, industry sector, technological environment, immigration, regional location and globalisation). In addition, two major hurdles have to be overcome: obtaining representative estimates of future ICT investment (purchasing plans) by business and government; and interpreting the new skills that will be in demand and the other impacts on the ICT skills market. The purchasing plans will encompass a wide range of ICT. Some ICT will be new, some will be well established technologies, and others will be upgrades of currently used products. Each category will require a range of different skills. They will largely involve the several hundred ICT skills in common use. The skills relevant to a specific new ICT product or service may include specialised knowledge as well as more broadly established skills. 15 Vision 20/20: Future Scenarios for the Communications Industry Implications for Regulation (Final Report, April 2005)

52 46 Building Australian ICT skills Assessment of the impact of investment on skills demand will need to consider capacity of the current skills pool to supply the skills, how the new skills required can be obtained, and in what time frame they will be available. The make up of the current skills pool is poorly understood. Each ICT practitioner has their individual portfolio of skills and the current labour market data collection stops at a measurement of occupational groups. This makes it impossible to estimate the dimensions of the current use of skills and how practitioners and trainers may adapt to demands for new skills. Without a sound knowledge of the current skill base it is not feasible to forecast future needs. Interpreting demand requirements related to both old and new technologies, and combining this with forecasts of the supply of new skills from retraining practitioners and new entrants to the ICT workforce, is an immense task. It is unlikely any reliably useful forecasts can be made even with detailed data on primary and secondary ICT skills in use. The United Kingdom and Canada have both tried integrating technology forecasts with labour market statistics to attempt to forecast future ICT skills supply and demand. Both studies resulted in very high level analyses that reflected on broad technology trends. The level of analysis did not facilitate detailed planning to respond to the broad trends. Demand for the diverse technical skills that make up the ICT labour market constantly changes and it successfully adapts in the longer term. Although shortages appear in some specific skills from time to time, the market does work to even out supply and demand of ICT skills. New technologies are constantly entering the market, while others are reaching a peak of utilisation. Other technologies are progressively outdated over long periods, but some residual continuing demand for older ICT skills remains. More commonly, the core technologies widely in use are progressively upgraded and ICT practitioners upgrade their skills concurrently. 6.3 ICT skills forecasting in Australia The issues involved in forecasting ICT skills supply and demand were thoroughly examined as part of the background research for this project. The major conclusion drawn is that the complexity in dealing with rapid changes in ICT trends, market dynamics and economic conditions, combined with the limits of available data, does not support reliable quantitative forecasting of skills demand and workforce numbers. Long range forecasting is limited by relatively short technology planning and investment cycles, and horizons for both the private and public sectors. The quality of the foresighting will largely depend on the quality of information available and modelling based on incomplete information may have significant weaknesses. Long range forecasting requires not only complete and accurate statistical trend data, but also accurate and detailed understanding of new and emerging technologies, products, trends in ICT goods and services markets, business innovation cycles, and social and demographic trends. There are many relevant parameters involved in any sound analysis and long term forecasting. However, there are a further set of economic, social and demographic factors which also impact on the demand for and supply of ICT workers and on the structure and composition of the ICT labour market, such as: economic trends and cycles, both domestically and globally, where boom and bust periods impact on the demand for skilled labour; market trends and investment cycles, which impact on new business and technology developments and demand for skilled ICT labour;

53 Building Australian ICT skills 47 population dynamics, including intergenerational impacts on labour force participation rates, migration and potential labour shortages; labour market re structuring over time in response to workplace reforms, the productivity benefits of ICT adoption and changing expectations of working arrangements (e.g. work/life balance, teleworking); and environmental and societal changes, such as climate change, spiralling living costs (eg rising fuel prices), urban congestion resulting in new ways of working (e.g. teleworking), with greater emphasis on online/virtual engagement and interactions and rising consumer expectations. 6.4 Modelling the future Primary factors influencing possible outcomes for skills foresighting include: 1. directions of current and future ICT research and development; 2. directions in the business investment cycles and level of investment by industries and governments; 3. scope for emerging technologies to form the basis of new or upgraded products, services and capabilities; 4. pace at which the new or upgraded products and services are taken up by consumers, business and government; 5. skills required in association with these products and services; 6. current availability of ICT skills (existing, upgraded or new); and 7. capacity for retraining, immigration and new graduates to meet emerging skills demand. 6.5 Current modelling Modelling is commonly approached from the top down by extending economic models to identify corresponding growth or decline in demand for particular industries and occupations across the economy. The Monash University economy wide economic model, an applied general equilibrium model that includes a labour market extension for occupations, contributes to DEWR s preparation of employment projections by industry and occupation. DEWR job turnover estimates, part of the occupational information available on Job Outlook online ( are based on projections prepared by the Centre for the Economics of Education and Training (CEET) at Monash University. 16 DEWR currently prepares projections of employment growth for industries and occupations to the year These projections are based on several factors, including: industry and occupation employment projections provided by the Centre of Policy Studies (CoPS) at Monash University (from the Monash University economy wide economic model); actual employment growth in recent years; occupational factors (for example, technological change); and qualitative information on industry and occupational developments. DEWR s employment projections are for Australia as a whole. The information created provides a broad indication of likely national job demand, but does not forecast state or regional skills demand or the prospects for specific skills. One key dimension missing from the forecasts are the likely supply and the specific skills of these positions. 16 DEWR Job Outlook, Department of Employment and Workplace Relations, June 2004.

54 48 Building Australian ICT skills Industry employment projections are part of the development of the occupational projections. Future demand for ICT occupations in Australia is driven by the combined impact of: projected employment growth for the main industries employing ICT workers (industry growth effect); and changing occupational composition: demand for an occupation resulting from a higher share of employment in industries (occupational share effect). The occupational employment projections are at an aggregated level, especially since the current occupational classification groups ICT Professionals into just two unit groups (IT Managers and Computing Professionals). Consequently, DEWR employment projections are for three ICT occupations: IT Managers, Computing Professionals and Computing Support Technicians. The latest DEWR projections (2006 update) indicate that there will be around new jobs in these three ICT occupations in the next five years. It has been suggested that modelling technology trends could provide a more detailed analysis which could identify specific skills that will be in demand. Work is being undertaken to explore the upgrading of the Monash model to take account of technological and social change on future labour demand. A complementary supply side forecasting system is currently being prepared. 17 DEWR undertakes a six monthly ICT skill shortage survey which is based on the recent recruitment experience of employers and ICT recruitment agencies, and examines whether employers have been able to find suitable workers. The ICT skill shortage research focuses on specialised ICT skills, not just occupations, due to the complex nature of ICT demand. The survey asks employers if they expect these skills in demand to get easier or harder to find over the next 12 months. The DEWR ICT skill shortage survey provides information on the percentage of ICT vacancies filled and skill shortages and recruitment difficulties for around 80 specialised ICT skills, for each State and Territory. DEWR has earlier noted that Australian and world economies are experiencing rapid evolution in specialised skill needs and such prediction (of future skill needs) is not prudent. The focus is therefore rather on providing information on prospective skill needs that will help to guide the response of the employment, education and training markets. 18 The scope for reliable ICT skills forecasting in Australia is at present severely limited by the difficulty and cost of obtaining the complete and accurate detailed information required to develop well founded forecasting models. 17 C Boswell, S Stiller and T Straubhaar, Forecasting Labour and Skills Shortages: How Can Projections Better Inform Labour Migration Policies, Migration Research Group, Hamburg Institute of International Economics (HWWA), July DEWR submission of May 2003 to the Senate Inquiry Bridging the skills divide

55 7 The future ICT professional

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57 Building Australian ICT skills The future ICT professional There is increasing speculation about the changing roles of ICT professionals and how to best describe the nature of their work to help students, teachers, parents, career advisers and the wider community gain a better understanding of the modern ICT workforce. In launching CompTIA Australia s new IT Pro Australia organisation in October 2005, the Minister for Communications, Information Technology and the Arts, Senator Helen Coonan noted that: The hallmarks of the ICT professional will soon include creative, interpersonal and project management skills, as well as expertise in specific areas such as health and education, and the ability to effectively mesh hard and soft skills. 19 The Working Group suggests that the term ICT professional is now far too generic and fails to provide the necessary context for the ICT work that is performed. This might be addressed by developing a new hybrid description which combines the essential technical aspect of their work i.e. being a technologist, with the industry or particular discipline in which the technology is being applied e.g. communications, financial services, health, mining etc. This would generate an entirely new set of occupational descriptions for ICT such as financial services technologist, communications technologist etc. Within these job titles there could also be scope to emphasise their particular field of specialisations, just as occurs now in many areas of medicine and the law. For example, I m a financial services technologist specialising in e security. The intention would be that this new shorthand might be more readily understood when promoting and describing ICT careers to young people, parents and teachers. The new ICT nomenclature developed as part of the Australian and New Zealand Standard Classification of Occupations (ANZSCO) will help to identify occupational clusters within ICT Professionals. Research from leading industry analyst Gartner presents a vision of the future ICT professional in 2010 as the versatilist one who has numerous roles, assignments and experiences and creates synthesized knowledge and context that fuel business value. For ICT professionals to function as the versatilist they will need to understand business realities industry, core processes, customer bases, regulatory environments, culture and constraints 20. Gartner predicts that by 2010 the ICT profession will be split into four main areas of expertise: technology infrastructure and services, with growth in service, hardware and software companies. Network design and security will remain strong everywhere, with routine coding and programming off shored to developing economies; information design and management, with growth in business intelligence, online consumer services, workplace enhancement. Search and retrieval practices and collaboration, particularly in ICT user, systems integration and consulting companies. In this area Gartner predicts there will be a demand for professionals with linguistics, language, information design and knowledge management skills; process design and management, involving standard operational processes (for outsourcing vendors), competitive business processes (for ICT user companies) and design of automation software (for software vendors); and 19 ICT skills essential to international competitiveness, Media Release 19 October The IT Professional Outlook: Where Will We Go From Here? Gartner Research Report Sept 2005

58 52 Building Australian ICT skills relationships and sourcing management, requiring ICT professionals to acquire skills in this area which demands strengths in managing intangibles, negotiating among different parties and coordinating outcomes among geographically distributed parties with different work agendas and cultures. In some instances ICT professionals in this area will serve as relationship managers between overseas service providers and domestic customers. Gartner goes on to suggest some of the ways in which ICT professionals and employers can make the transition to this new environment and some of the challenges for employers: ICT Professionals start now to assess and build their business specific, core process and industry knowledge; choose the area of expertise which best suits them and what appeals to them and place increased emphasis on learning and relationships as key factors for their success; look outside the traditional business ICT world for new challenges and opportunities and new emerging roles in areas such as in leisure and entertainment, not for profit and government; acquire business training and education as well as technical proficiency; and tap into professional, personal and social networks, whether to face to face or virtual, to explore options and opportunities and to keep an objective eye on their career paths. Employers develop and redirect professional opportunities for staff; develop growth paths and careers opportunities within each of the four areas of expertise; and anticipate that some ICT professionals will want to move out of technical areas into new more business focussed areas.

59 Conclusion

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61 Building Australian ICT skills Conclusion The ICT Skills Foresighting Working Group was established to provide advice to Government on a range of issues relating to the information and communication technology (ICT) skills market. In addressing these issues the Working Group has reviewed current trends and likely future developments within Australia s ICT industry and their implications for ICT skills development. This included forecasting future ICT skills demand, the fit between industry skill needs and existing training, and options for better meeting the future skill needs of industry. In contributing to the preparation of this report the Working Group acknowledges that the recommendations put forward are not an overarching solution to the supply and demand issues surrounding the ICT skills market. However, the Working Group firmly believe that a coordinated response to the recommendations from government, industry, employers, ICT professionals, students, and education and training providers will form the basis for positive change. Implementation of the recommendations in this report is critical if Australia is to maintain competitiveness and maximise the potential of ICT generated productivity growth across all sectors of the economy.

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63 Appendices

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65 Building Australian ICT skills 59 Appendix A ICT Skills Foresighting Working Group Membership and Terms of Reference The ICT Skills Foresighting Working Group was chaired by Mr Keith Besgrove, Chief General Manager, Information Economy Division of DCITA and supported by a DCITA secretariat. Mr Andrew Bray and Mr Denis Hart of the Department of Workplace Relations and Employment also attended a number of working group meetings and provided information such as that presented in Appendix C. The working group membership was: Ms Danika Bakalich, CompTIA Australia Mr Michel Hedley, Australian Information Industry Association Mr John Maddock, Box Hill Institute Mr Edward Mandla, Australian Computer Society Professor Ron Weber, Monash University Assoc Prof David Wilson, University of Technology Sydney Mr Norman Lacy, Executive Director, Information Technology Contract and Recruitment Association (ITCRA) Ms Megan Lilly, General Manager Education and Training, Australian Industry Group The Terms of Reference for the working group were: 1. Work with DCITA on an analysis of the implications for possible future industry skill needs of technology trends, global industry changes, current and future challenges in the domestic economy and possible emerging markets for Australia s ICT industry. 2. Assist DCITA to identify possible emerging gaps between the skill requirements of industry and current education and training arrangements, and to identify possible mechanisms to enable the ICT skill needs of industry to be more effectively met from within the Australian education and training system. 3. Work with DCITA to develop possible options for informing the design of university, vocational education and training (VET), industry and private education and training curriculum, courses and programs, including on-the-job training programs, and the training, retraining and up-skilling decisions made by employers and ICT workers. 4. Contribute to preparation of a report by DCITA on the main findings and conclusions from the analysis and possible options for better meeting the future skill needs of the ICT industry.

66 60 Building Australian ICT skills Appendix B Overview of the ICT industry in Australia The traditional Australian ICT industry, as measured on the basis of firms deriving at least 50 per cent of their income from the sale of ICT goods and services, accounts for only some 40 per cent of ICT professionals. The remaining 60 per cent are spread across other sectors of the economy for example, banking, transport, agriculture reflecting the shift of the ICT industry into domains in which it operates, the integration of ICT in economic activity and the increasing reliance of all economic sectors on ICT based goods and services. This picture is confirmed by the 2005 Sensis Business Index Special Report, ICT Production in Australian SMEs, Sensis survey of a representative sample of small to medium enterprises (SMEs) across the economy estimated that 85 per cent of the ICT goods and services produced by SMEs in Australia are produced by firms outside the ICT industry as traditionally defined. Firms outside the ICT industry were producing ICT for their own business operations, to sell as ICT or to embed in other goods and services that they sold. Nevertheless, the traditionally defined ICT industry represents Australia s core capability in ICT production. According to the ABS ICT Satellite Account 21, the value of Australian production of ICT goods and services by ICT specialist firms is estimated to be approximately $58.8 billion: manufacturing $1.8 billion wholesale trade $8.9 billion telecommunication services $32.6 billion computer services $15.5 billion ICT value added production by specialist ICT firms only is 4.1 per cent of total Australian GDP in 2002/03. However this estimate does not take into account the full contribution of ICT tools and enhancements across the economy through improved operational efficiency, product and service innovations, and new business models and markets. The Australian ICT industry comprises about specialist ICT firms which employ approximately people. As shown in Table 1, most of the firms are micro firms (0 4 employees) and the 188 largest firms (100 or more employees) account for 55 per cent of total employment in the industry. Table 1 ICT firm size and employment ( ) Firm size (number of employees) Total number of ICT businesses (%) Total ICT industry employment (%) or more ABS, ICT Satellite Account 2002/03, Cat. No , released March 2006

67 Building Australian ICT skills 61 Australia is developing strengths in computer services and software in niche high end applications and markets, reflecting the competitiveness of Australian skills and the demand from Australian users. McKinsey & Company identified two strands of major opportunities for Australian ICT producers: 22 providing specialised applications and services to global markets for example, for the mining sector and computer games industry; and providing specialist skills and services for global multinational companies for example, as regional hubs for high end research and development work. 22 Australia: Winning in the Global ICT Industry, 2003

68 62 Building Australian ICT skills Appendix C Overview of ICT employment in Australia In February 2006, Australia had ICT workers spread across all sectors of the economy. While it is difficult to draw clear boundaries around the question of what are ICT occupations, the occupations presented in Table C.1 are the main ICT specific occupations and provide a guide to the employment base for ICT. The two largest occupations Computing Professionals and IT Managers together comprise ICT Professionals. In February 2006 there were ICT Professionals employed in Australia. Table C1: Employment in ICT occupations (February 2006) ASCO code Occupation Employed 000 Share of ICT employment (%) 2231 Computing Professionals IT Managers Computing Support Technicians Electronic Trades Electrical and Electronics Engineers Communications Trades Electronic Engineering Associates Electrical Engineering Associates Electronic Instrument Tradespersons Total employment in ICT occupations Source: DEWR trend analysis based on ABS Labour Force Survey data ICT represents about 3.6 per cent of the total workforce and is higher than for Europe (about 2.5 per cent) and the United States (about 2.8 per cent). This is likely to be an under representation of ICT occupations as some ICT occupations and specialisations are not explicitly recognised in the current occupation classification used by the ABS. Table 1 shows the occupation code, based on the Australian Standard Classification of Occupations (ASCO 2 nd edition), for each ICT occupation. The new Australian and New Zealand Standard Classification of Occupations (ANZSCO) will significantly upgrade the quality and usefulness of data collected on ICT occupations. ANZSCO will also provide an alternative view of ICT occupations that will reflect a more inclusive view of the ICT industry. The ANZSCO classification will be implemented in the August 2006 Census, and in the Labour Force Survey from August More information on the ICT nomenclature in ANZSCO is available in the Information Paper on the ABS website ( ABS Cat No

69 Building Australian ICT skills 63 ICT occupations Computing Professionals, the largest ICT occupation, accounts for 45.7 per cent of all employment in ICT occupations across the economy (Figure C.1). The next two largest ICT occupations are IT Managers (12.1 per cent) and Computing Support Technicians (11.4 per cent). The ICT occupations reflect a mix of skill level requirements, based on ASCO 2 nd edition definitions. Professional and managerial occupations, including IT Managers, Computing Professionals and Electrical/Electronics Engineers require a bachelor degree or higher qualification (several years relevant experience may substitute for the formal qualification). Trades occupations, such as Electronic Trades, require an Australian Qualifications Framework (AQF) Certificate III or higher qualification. Associate Professional occupations, for example Computing Support Technicians and Electronic/ Electrical Engineering Associates, generally require an AQF Certificate IV, diploma or higher qualification. Figure C.1 Employment in ICT Occupations February 2006 ( 000) Other occupations requiring high ICT proficiency While the ABS categories focus on the core ICT professional roles, the data do not adequately reflect jobs that require a combination of high level ICT and other skills or knowledge (for example, graphic designers in the multimedia industry or business analysts). The ongoing development and uptake of ICT applications has brought growth in non ICT occupations which are increasingly dependent on high level ICT skills. With the increasing pervasiveness of ICT in all sectors of the economy, expertise in other technologies and industries (for example, the health sector) is becoming increasingly important. Business management skills and interpersonal, communication and other soft and/or employability skills are also assuming greater importance for ICT workers in all industries.

70 64 Building Australian ICT skills Some leading recruitment firms and senior IT executives consider that today s IT professional: must adopt a holistic approach to business, with a strong business and administration base under pinning their technical knowledge and skills; needs to offer a broader range of skills such as customer service, presentation skills, high level report writing ability, high level management and interpersonal skills; needs to be less purely technically focused, given the ready availability of off the shelf software packages; and can make a crossover into ICT from another industry so long as they possess transferable skills, such as an understanding of how a business operates and end to end appreciation of business processes. ICT skills and entry to ICT professional careers According to data provided by members of the Information Technology Contract and Recruitment Association (ITCRA): 9 per cent of IT professionals have no ICT qualifications; 13 per cent have TAFE qualifications; 13 per cent have an industry or vendor certificate; and 52 per cent have an ICT related degree. There is evidence of people from non ICT backgrounds moving into ICT occupations. Ambit Recruitment has identified five main categories in which non technical professionals enter the industry: project managers, with the most successful non IT applicants having backgrounds in engineering, accounting and consulting; IT systems testers (in areas such as retail, banking, finance, insurance and health), with non IT applicants generally being subject experts such as underwriters, bank officers and HR personnel; IT business analysts, with non IT applicants frequently being accountants with analytical experience; IT project coordinators, with non IT applicants generally being project administrators; and IT commercial/contract managers, with commercial managers with MBAs and business managers with legal, financial and contracts experience being a feature. Although migration from non ICT backgrounds is significant, university training remains the key source of new ICT professionals. TAFEs and private training organisations are also significant providers of specific professional ICT courses, but the data tends to be fragmentary and analysis is consequently difficult. Educational profiles for May 2005, for IT Managers, Computing Professionals and Computing Support Technicians, are presented in the Appendix to Attachment C. ICT employment trends IT Managers, Computing Professionals and Computing Support Technicians are the three dominant ICT specialist occupations. Together they account for employment of persons or over two thirds of employment in all ICT occupations. This analysis of ICT employment trends will concentrate on these dominant ICT occupations.

71 Building Australian ICT skills 65 In the past decade employment for ICT Professionals has risen strongly, albeit with employment declines around 1999 and, more recently, in While the employment losses in 2004 reflected the downturn in the ICT industry, this is also an adjustment following the very strong growth in the past 10 years. Figure C2: Employment trends for ICT occupations 10 years to Feb 2006 ( 000) ICT Professionals 150 Computing Professionals Computing Support Technicians 25 Information Technology Managers 0 Feb-96 Feb-97 Feb-98 Feb-99 Feb-00 Feb-01 Feb-02 Feb-03 Feb-04 Feb-05 Feb-06 Source: ABS, Labour force Survey, Australia, DEWR trend data In the 10 years to February 2006 employment for all three ICT occupations rose strongly. Computing Professionals rose by or 50.4 per cent, including: strong growth of or 8.8 per cent in the year to February 2006; employment for IT Managers rose by or per cent; and Computing Support Technician employment grew by or 72.1 per cent. Figure C6 presents employment levels for ICT Professionals, the combination of Computing Professionals and IT Managers, for the period February 1990 to February The number employed rose strongly between 1994 and 2003 to , before levelling out and then falling to in February The strong rise in the past year has taken employment for ICT Professionals to

72 66 Building Australian ICT skills Figure C3: Employment for ICT Professionals Feb 1990 to Feb 2006 Employment trends for ICT occupations mirror developments in the Computer Services industry (an Australian and New Zealand Standard Classification of Industries ANZSIC three digit industry), as shown in Figure C4. As the graph shows, employment in the Computer Services industry rose very strongly in the late 1990s, and during 2000, before declining in the following years. In many respects this decline can be viewed, in part, as an adjustment following the previously very strong growth, as well as reflecting the world wide downturn in the industry. There is evidence of a turnaround, with employment growth in the past year. In the 10 years to February 2006, employment in the Computer Services industry rose by or per cent to Figure C4: Employment in Computer Services Indexed (February 1996 = 100.0) Computer Services 150 Business Services 100 Telecommunication Services All Industries 50 Feb-96 Feb-97 Feb-98 Feb-99 Feb-00 Feb-01 Feb-02 Feb-03 Feb-04 Feb-05 Feb-06 Source: ABS, Labour Force Survey, Australia, DEWR trend data

73 Building Australian ICT skills 67 Graduate employment outcomes Graduate Careers Australia data ( as presented in Figure C5, show employment status in the April following graduation. Employment outcomes (percentage in full time employment) for Electronic Engineering/Computing Engineering and Computer Science improved in 2004 and 2005, but remain below the average for all graduates. Figure C5: IT Graduates Percentage in full time employment, Electronic/Computing Engineering All Graduates Computer Science Unemployment The recent improvement in the ICT labour market is clearly evident in the unemployment rates for ICT occupations. For IT Managers the unemployment rate in 2005 (1.0 per cent) was around one fifth of that in 2003 (4.9 per cent). The unemployment rate for Computing Professionals has halved from 4.1 per cent in 2003 to 2.1 per cent in Occupational unemployment rates do not include first job seekers and hose unemployed for two years or more, and are typically lower than the overall unemployment rate (currently close to 5 per cent).

74 68 Building Australian ICT skills Figure C6: Unemployment rates for ICT occupations Source: ABS, Labour Force Survey, Australia, original data, annual averages Prospects for the ICT labour market Indicators point to a continuing pick up in the ICT labour market in Australia, although prospects vary for skill sets. ICT vacancies have risen strongly in recent years (see Figure C7) foreshadowing short term growth in jobs. Employment levels are projected to rise, albeit not as strongly as in the past decade. Prospects for ICT are linked to Australia s overall economic and employment growth prospects. DEWR s ICT Vacancy Index a count of vacancies on three online recruitment sites has risen consistently and strongly in the past three years, apart from seasonal fluctuations (the ICT vacancy index is not seasonally adjusted). Figure C7: DEWR s ICT vacancy index, January 2002 to April Jan 02 Apr 02 Jul 02 Oct 02 Jan 03 Apr 03 Jul 03 Oct 03 Jan 04 Apr 04 Jul 04 Oct 04 Jan 05 Apr 05 Jul 05 Oct 05 Jan 06 Apr 06

75 Building Australian ICT skills 69 Attributes of ICT Employment in the Australian Economy ICT employment is strongly concentrated (over 70 per cent) in five industries: Property and Business Services (37.2 per cent); Communication Services (12.8 per cent); Government Administration and Defence (7.7 per cent); Finance and Insurance (6.7 per cent); and Manufacturing (6.7 per cent). Table C2: ICT share of Employment by Industry August 2005 Industry ICT Employment for Industry ( 000) Share of total ICT Employment (%) Property and business services Communication services Government administration and defence Manufacturing Finance and insurance Education Retail Trade Wholesale trade Construction Electricity, gas and water supply Transport and storage Cultural and recreational services Health and community services Mining Personal and other services Agriculture, forestry and fishing Accommodation, cafes and restaurants All industries Source; ABS collections; Notes: *data not collected np data not published There is a higher proportion of male ICT professionals in every industry group. A similar picture is apparent for the ICT industry (Table C3), where women constitute 18 to 26 per cent of ICT professional employment. Table C3: Share of Males/Females Employed in ICT roles in ICT industry sub sectors, 2004 Male (%) Female (%) Computer services Telecommunications services Manufacturing and other 81 19

76 70 Building Australian ICT skills An examination of the distribution of ICT workers in the three main ICT occupations shows that around one in five ICT Professionals (IT Managers and Computing Professionals) are women. While only a small proportion of the workforce, comments from female IT managers indicated that the skills of female candidates were valued and competitive in the higher end jobs. Women have a higher share of employment for Computing Support Technicians (28.3 per cent in 2005). Figure C.8 also highlights the high proportion of full time jobs for ICT workers, ranging from around 95 per cent for IT Managers and 92 per cent for Computing Professionals, down to 88 per cent for Computing Support Technicians. This characteristic may impact on female participation in the ICT workforce. Figure C8: Employment in ICT Occupations by Gender Percentage share of employment (2005) In the internet and multimedia sectors, digital industry management is dominated by females with a background in marketing and public relations. ABS Labour Force Statistics indicate that females are well represented in public relations and marketing professional roles, holding about 56 per cent of jobs. They also indicate that females account for about 46 per cent of graphic designers and illustrators. Assessment by the Equal Opportunity in the Workplace Agency (EOWA) of compliance reports submitted by IT employers with over 100 employees indicates that women comprise 31 per cent of employees in the IT sector. This is lower than the average of 47 per cent for all industry sectors. EOWAs report also reveals that females are relatively well represented in management positions across the IT industry despite the low proportion of female employees. Table C4 reveals that 24 per cent of females occupy such positions. Table C4: IT specialist firms and female managers, provided by the EOWA IT specialist firms All % female employees % female managers 24 31

77 Building Australian ICT skills 71 Ageing of the ICT workforce Ageing of the workforce is less pronounced in ICT occupations than for the workforce as a whole. ICT Professionals have a younger than average age profile. The median age for Computing Professionals in 2005 at 35 years (see Figure C3) compares with 39 years for all occupations. In 2005, the proportion of Computing Professionals aged 45 years and over was 22.3 per cent, well below the 35.8 per cent share for all occupations. Figure C9: Computing Professionals Percentage share of employment by age. Median age for this occupation = 35 years. ICT skill shortages The Department of Employment and Workplace Relations (DEWR) undertakes research on ICT skill shortages, based on recent recruitment experience of employers and ICT recruitment agencies. The ICT skill shortage research focuses on specialised ICT skills, not just occupations, due to the complex nature of ICT demand. The skill shortage findings are a key input to the Skilled Migration Program, especially the Migration Occupations in Demand List (MODL). ICT skill shortage information is also used more generally to facilitate better occupational targeting in the Migration Program. The 2005 ICT survey was undertaken in each state and territory and involved contact, by telephone, with 123 employers and 90 ICT recruitment agencies across Australia. The findings of the survey indicate that there has been a pick up in demand for ICT skills (around 70 ICT skills were examined). The ICT skills in shortage or with recruitment difficulties vary across the states, including 24 ICT skills in shortage in New South Wales. This is important as New South Wales has about 53 per cent of ICT vacancies and 40 per cent of ICT employment.

78 72 Building Australian ICT skills Figure C10: ICT Vacancy Filling Rates 2004 and 2005 Source: DEWR ICT skills Shortage survey May 2005 The ICT survey findings indicate that nearly 84 per cent of vacancies advertised by employers were filled within six weeks of advertising, almost the same filling rate as the previous survey in May 2004 (see Figure C10). Of the larger states, between 2004 and 2005 vacancy filling rates rose in New South Wales, Victoria and South Australia, but fell sharply in Queensland. The survey found that the ICT labour market has tightened (see Figure C9), a view consistently evident in the advice from ICT recruitment agencies that they were experiencing recruitment difficulties, and in many instances shortages, for some ICT skills. Figure C11: Number of suitable applicants per ICT vacancy 2004 and NSW VIC QLD SA WA TAS ACT NT Australia Source: DEWR ICT Skill Shortage survey May 2005

79 Building Australian ICT skills 73 Appendix D Overview of ICT Skills Supply in the Higher and Vocational Education Sector Definition of ICT Information and communication technology occupations have constantly evolved and expanded over the last 10 years. Continual redefinition of the profession over this time has meant that standards for data collection have changed periodically. These changes mean that the supply chain can be mapped more accurately over the last five years than for any longer period, and the data presented in this report will concentrate on analysis over this time. The Australian Qualifications Framework Comparisons between qualifications and their requisite education and training can be made across schools, vocational education and the higher education sectors through the Australian Qualifications Framework. This framework, implemented fully since 2000, provides for articulation and standardisation within an integrated set of 12 nationally and internationally recognised qualifications across Australia. It gives ICT practitioners flexible pathways between different education and training choices and encourages transitions through the levels. Comparative data is collected. 23 ICT skills supply from Higher Education Participation in Higher Education can be measured in a number of ways. Using completions as a measure of output, this analysis provides an indication of trends regarding the quantity of ICT graduates. However, it takes some three to five years to acquire a degree in ICT fields and thus the level of commencements will continue to influence the level of output some years down the track. DEST annually collects and collates data on higher education students on award course completions, commencing students and field of study classifications from those institutions which receive operating grants from the Commonwealth. 23

80 74 Building Australian ICT skills Figure D1: DEST Higher education statistics 2004: Time Series Award Course completions 1994 to 2003 Award Course Completions for All Students by Citizenship and Broad Field of Education (Information Technology), 1994 to Information Technology (b) (a) (a) (a) (b) (b) (b) Domestic students Overseas students Total students (a) Data for have been mapped from field of study classification to field of education classification.. (b) The data takes into account the coding of Combined Courses to two fields of education. As a consequence, counting both fields of education for Combined Courses means that the totals may be less than the sum of all broad fields of education Figure D1 shows that there has been more than a doubling in the number of students studying information technology between 1994 and Since 2001 this growth has been represented by the large increases in the number of overseas students (by more than one thousand percent). Domestic ICT enrolments steadily climbed until 2000, when there was a sudden fall of approximately 11 per cent, with fluctuations in enrolments since this time. This fall in ICT completions domestically contrasts with a continual increase in student numbers overall across the 10 year period examined. In 2003, IT students were 8.9 per cent of broad field of education categories. IT student numbers increased by 3.3 per cent in 2003, but this was below the average of 5.4 per cent. However this does not reflect the students of other fields studying aspects of IT (i.e. creative arts has the highest increase of 14 per cent and undoubtedly contains an increasing IT or digital content component) and the impacts of technology convergence blurring distinctions between ICT and the fields of endeavour they are used in D755 49D0 ABEB 91EC384F71EA/4221/summ_tables_3.xls

81 Building Australian ICT skills 75 ICT Skills supply from the VET sector Overview The administration of the vocational education sector has changed recently with the abolition of the Australian National Training Authority (ANTA) in 2004 and with the transfer of its function within DEST and specific national industry skills councils. The industry skills council of most interest to the ICT industry is the Innovation and Business Skills Australia (IBSA), which administers the ICT and telecommunications training packages. Within IBSA, ICT areas of skills development focus on networking and network security; services and support; testing; project management; database design and development; software development; systems analysis and design; systems administration and management; web and multimedia technologies; customer contact centres; and programming. The cultural and creative arts sectors are also increasing their ICT components through units in multimedia and web design, and moving towards managing and creating more digital content. National Training Packages A training package is a nationally endorsed and recognised set of integrated training and assessment components for a specific industry, industry sector or enterprise that can be used for developing and recognising people s competencies. Each training package must consist of the three key components of competency standards, assessment guidelines and a qualifications framework. These are then endorsed by the National Training Quality Council (NTQC). The ICT and the telecommunications packages are the ones of interest to the Working Group. Information and Communications Technology Training Package (ICA05) The Information Technology Training Package endorsed in October 2005 includes 22 qualifications, ranging from Certificate I in Information Technology to higher level qualifications in a range of specialisations including network security and information

82 76 Building Australian ICT skills Overview of Information and Communications Technology Training Package (ICA05) Level Certificate I Certificate II Certificate III Certificate IV Qualification ICA10105 Certificate I in Information Technology ICA20105 Certificate II in Information Technology ICT20102 Certificate II in Customer Contact ICA30105 Certificate III in Information Technology ICA40105 Certificate IV in Information Technology (General) ICA40205 Certificate IV in Information Technology (Support) ICA40305 Certificate IV in Information Technology (Websites) ICA40405 Certificate IV in Information Technology (Networking) ICA40505 Certificate IV in Information Technology (Programming) ICA40605 Certificate IV in Information Technology (Testing) ICA40705 Certificate IV in Information Technology (Systems Analysis and Design) ICA40805 Certificate IV in Information Technology (Multimedia) Diploma ICA50105 Diploma of Information Technology (General) ICA50205 Diploma of Information Technology (Project Management) ICA50305 Diploma of Information Technology (Systems Administration) ICA50405 Diploma of Information Technology (Networking) ICA50505 Diploma of Information Technology (Database Design and Development) ICA50605 Diploma of Information Technology (Website Development) ICA50705 Diploma of Information Technology (Software Development) ICA50805 Diploma of Information Technology (Systems Analysis and Design) ICA50905 Diploma of Information Technology (Multimedia) Advanced Diploma ICA60105 Advanced Diploma of Information Technology ICA60205 Advanced Diploma of Information Technology (Network Security Telecommunications Training Package (ICT02) The Telecommunications Training Package, which is currently under review, includes 18 qualifications ranging from Certificate II to Advance Diploma specialising in either the customer contact or technical aspects of the industry

83 Building Australian ICT skills 77 Overview of Telecommunications Training Package (ICT02) LEVEL Certificate 11 QUALIFICATION ICT20102 Certificate II in Customer Contact ICT20202 Certificate II in Telecommunications ICT20302 Certificate II in Telecommunications Cabling Certificate 111 ICT20402 Certificate II in Telecommunications Access Network ICT30102 Certificate III in Customer Contact ICT30202 Certificate III in Telecommunications Certificate 1V ICT30302 Certificate III in Telecommunications Cabling and Customer Premises Equipment ICT40102 Certificate IV in Customer Contact ICT40202 Certificate IV in Telecommunications Engineering ICT40302 Certificate IV in Telecommunications Computer Systems Diploma ICT40402 Certificate IV in Telecommunications Network Planning ICT50202 Diploma of Telecommunications Engineering ICT50302 Diploma of Telecommunications Computer Systems ICT50402 Diploma of Telecommunications Photonics Advanced Diploma ICT50102 Diploma of Customer Contact Leadership ICT60202 Advanced Diploma of Telecommunications Engineering ICT60302 Advanced Diploma of Telecommunications Computer Systems ICT60102 Advanced Diploma of Customer Contact Management VET student and training data VET data includes information on training provided through VET in schools, pre apprenticeship and apprenticeship programs, national training packages delivered through government and private training providers and certifications and niche training provided through industry partnerships. The VET sector also collects statistics compliant with the Australian Standard Classification of Education. Therefore comparisons between data can be made at the broad level of the fields of education classifications (i.e. for the information technology designation). Much of this data has been taken from that compiled by IBSA from National Centre for Vocational education research (NCVER) data drawn from their draft Industry Skills report. 27 VET Students and subject enrolments by major course field of education, VET data includes information on training provided through VET in schools, pre apprenticeship and apprenticeship programs, national training packages delivered through government and private training providers and certifications and niche training through industry partnerships. The VET sector also collects statistics compliant with the Australian Standard of Education. 27 NCVER, Australian vocational education and training statistics Students and courses 2003, ANTA 2004 page 3 Downloaded 2004

84 78 Building Australian ICT skills The following table shows data at the broadly designated information technology subject area: Table D1: VET Students and subject enrolments Information Technology IT students by major course field of education 2 Subject enrolments by subject field of education IT As can be seen, there has been a substantial fall in student numbers of 33 per cent between 2002 and This is set against an overall fall in VET students of 5.5 per cent. Female students represent 32 per cent of students in This is in contrast to the higher education sector where female students in 2004 represented 29 per cent and 18 per cent of undergraduate and postgraduate students respectively. Female students are therefore less likely to be enrolled in IT courses as their levels of qualification increase. Figure D4: VET Students by major parent training package, The data refers to the national training packages related to Information technology and telecommunications. Students by Information and Telecommunications Training Package Information Technology Telecommunications The number of students completing packages with the VET system has fluctuated with peaks in 2000 and 2003 and a five year low in VET in Schools The subjects undertaken within the VET in schools program are those at the Certificate I and II levels. These subjects tend to be IT rather than telecommunications based. The following data shows a fall enrolment in VET in school IT courses: VET in Schools Activity, , Australia 29 Field of Education % change IT For a given Module/Unit of Competency, the parent Training Package denotes the industry that developed the training package. 29 Source: NCVER National VET Provider Collection, released July 2005; Public VET System Tables for Australia

85 Building Australian ICT skills 79 Appendix endnotes 1 Taken from B402 45A6 9C B16FE/7636/ 12Appendices.xls, Higher Education Statistics 2004, Appendix Source: NCVER National Provider Collection, released July 2005, Table 20 available at. 3 Source: NCVER National Provider Collection, released July 2005, Table 29 available at. 4 Source: NCVER National VET Provider selection, Released July 2005, Table statistics/vet/ann04/id04/s&c2004table22.xls

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88 Further information Department of Communications, Information Technology and the Arts