Advanced trade, technical and professional qualifications – matching supply to demand
There is a limited number of areas where it is clear that increasing the number of people with trade, technical or professional qualifications would definitely reduce skill shortages. These areas are in engineering, building and medical professions. Demand in these areas has been driven by increased use of technology, increased construction activity and increased demand for health services. In other areas examined in the report, improving the quality and relevance of qualifications is likely to be as important, or even more important, than increasing the number of people graduating.
This is report is the second in a series of three reports looking at the supply of and demand for advanced trade, technical and professional qualifications. The first report, looking at demand for qualifications is available on Education Counts.
Author: David Earle [Ministry of Education]Date Published: July 2008
12 - Conclusion
The following table summarises the findings for each field of study discussed above and rates them in terms of the effectiveness of increasing the number of people with qualifications to address shortages. Red (or dark grey) indicates low effectiveness, amber (or mid-grey) moderate, and green (or light grey) high.
|
Field |
Level 4 certificate |
Level 5-6 diploma |
Bachelors and above |
| Information technology | Moderate match Very high unemployment Moderate premiums | Good match Higher unemployment Limited premiums | |
| Engineering and related technologies | Strong match Low unemployment (males) Good premiums | Strong match Low unemployment (males) Good premiums | Strong match Average unemployment (males) Moderate premiums |
| Architecture | Strong match Low unemployment (males) Moderate premiums | Strong match Low unemployment (males) Limited premiums | |
| Building | Strong match Low unemployment (males) Good premiums | Strong match Low unemployment (males) Good premiums | Good match Average unemployment (males) Good premiums |
| Medicine | Strong match Low unemployment High premiums | ||
| Nursing | Good match Average unemployment Negative premium | Strong match Low unemployment Negative premium | Strong match Low unemployment Negative premium |
| Other health | Moderate match Higher unemployment Negative premium | Good match Lower unemployment Negative premium | Good match Lower unemployment Moderate premiums |
| Accountancy | Good match Average unemployment Moderate premiums | ||
| Finance and sales | Poor match Average unemployment Good premiums | Poor match Higher unemployment Moderate premiums | |
| Human and welfare studies and services | Good match Higher unemployment Negative premium | Good match Higher unemployment Negative premium | |
| Behavioural science | Limited match Average unemployment No premium | ||
| Law | Strong match Low unemployment Good premiums | ||
| Food and hospitality | Good match Average unemployment Negative premium |
The major conclusion of this analysis is that there are a limited number of areas where there is a clear case that increasing the number of people attaining qualifications would make a definite contribution to addressing skill shortages. These areas are:
- Engineering (all levels)
- Architecture (diploma)
- Building (certificate and diploma)
- Medicine (bachelors and above)
- Other health (bachelors and above)
- Law (bachelors and above).
There are a few others areas where increased numbers of people attaining qualifications may contribute to reducing skill shortages. However, in these areas, the quality and relevance of provision may also be important to address, as well as the conditions of work in some areas. These areas are:
- Information technology (bachelors and above)
- Architecture (bachelors and above)
- Building (bachelors and above)
- Nursing (diploma and bachelors)
- Other health (bachelors)
- Accountancy.
In the remaining areas, increasing the number of people attaining qualifications is unlikely to make a particular contribution to easing skill shortages, unless there are also improvements in attractiveness and conditions of employment.
The main underlying drivers for demand for increased numbers of people with advanced qualifications have been the boom in construction, increased use of technology and increasing demand for health services.
The data used in this analysis reflects the situation as at March 2006, just after the peak of a construction industry cycle (see Earle, 2008, figure 2.1). Five out of the ten areas listed above are strongly related to the construction industry. Law is also indirectly influenced, in the areas of property conveyancing and resource consents. Therefore, the data is likely to overestimate the current demand in these areas.
Recent figures show that the demand for labour in the building industry has flattened out, well below the peak of 2005 (NZIER, 2008a). The housing market boom has ended, with domestic building consents decreasing and sales dropping. Firms are indicating an intention to reduce investment in buildings and plant and machinery. However, commercial building consents have continued to increase, so there may be an increase in commercial building in the near future, accompanied by further growth in infrastructure investment, particularly roading (NZIER, 2008b).
The key issue for the building- and construction-related areas will be to ensure that there is sufficient supply of new graduates to meet the long-term demands of the industry and deliver the new skills required as the technology involved evolves and develops.
It should be noted that the education area was not examined in this report due to limitations on the availability of census data, at the level required to examine this field of study. The first report highlighted shortages of early childhood teachers and science, mathematics and technology secondary teachers. It is likely that these are both areas where increased supply of graduates may help.