Myth and reality: employer sponsored training in Australia

Abstract

In 1990, Australia implemented an employer training levy, the Training Guarantee Scheme. The Training Guarantee was abolished by the incoming Coalition Federal government in 1996 after much negative publicity about its impact, particularly on small business. Recently, there have been calls to revive the notion of an employer training levy as result of statistical evidence that employer expenditure training has declined since 1996. In this context, employer training expenditure has been taken as a proxy for employer commitment to training. This article considers the statistical evidence on employer training in Australia and concludes that the case against Australian employees is far from clear cut. Data from a variety of sources suggest strongly that Australian employees provide a similar level of training to their employees as employers in other developed countries. The paper proposes that it is the distribution of employer training expenditure that is important to long-term skills formation rather than the total expenditure.