The Victorian Automotive Chamber of Commerce (VACC) CEO Geoff Gwilym told GoAutoNews Premium that the parlous state of apprentice uptake in the automotive industry was triggered after the previous federal government earlier this year pulled funding that partly paid apprentice wages.

Now, the new federal government has made no attempt to kickstart that funding program, a silence that Mr Gwilym said combines with an inability to introduce skilled immigrants to create a much weaker outlook for the automotive sector.

The “Australian Government’s Boosting Apprenticeship Commencements” program paid 50 per cent of the apprentice wage in their first year of training and ceased on June 30 this year, replaced with the Australian Apprenticeships Incentive Scheme that has a reduced subsidy of 10 per cent of the wage in years one and two, and five per cent of wages in the third year.

It is available from July 1, 2022 to June 30, 2024 and applies to 77 trades on a “priority list”, seven relating to the automotive industry.

Geoff Gwilym

Mr Gwilym said that with the end of the 50 per cent wage subsidy, he predicts that will lead to a drop off in automotive apprenticeship commencements. 

He said that the now-closed federal incentive subsidies “created an avenue for a lot of employers to take on apprentices with less risk.”

“Consequently, about 50 per cent of all apprentices in automotive were adults over the age of 21, which was a market we normally wouldn’t tap into because employers couldn’t or wouldn’t pay the wage of an adult apprentice.

“We now have major challenges with apprenticeship commencements that are not helped by curtailing the import of international labour over the past two years. Even with the current target of 160,000 migrants, less than 20 per cent of those are skilled migrants. 

“Of that, we’d be lucky to get 1000 automotive personnel from the whole skilled migration scheme in Australia so we’re never going to fill the skills gap with international labour. It is a complement to taking on apprentices but it is not a panacea by any means.”

Mr Gwilym said Australia’s automotive industry was further disadvantaged because of a global shortage of skilled workers including in Europe and North America.

“Unfortunately, one of the things we did really badly in Australia is when COVID came, we sent everybody home. We sent a message that we don’t want you here. And guess what? They listened. And many don’t want to come back,” he said.

“So we’ve still got big challenges here. We need the government to do something really serious around that 50 per cent wage offset for first year apprentices.

“You need something big like that to actually make it meaningful enough for an employer to take on an apprentice.”

Mr Gwilym said that as members of the Australian Chamber of Commerce and Industry, the VACC would at least like to see a new government announce that it will pay the 30 per cent of apprentice wages for the first year. 

“But we’re not at the moment. We’re not getting any signals from our government about a change,” he said.

Mr Gwilym said the federal government has a “skills summit” next month but he was wary about any outcome.

“I just think it’s going to be used as a forum to voice a whole lot of things that different political groups want,” he said. “Disappointingly, that may not have anything to do with skills.”

By Neil Dowling