Vocational Education Skills and the rise of the ‘how to’ economy

A drop-off in postgraduate enrolments in the higher education sector is an indicator the world of work is already changing. What are the implications for Vocational Education skills from the decline in enrolments numbers?

Trends in the higher education postgraduate student market are not usually top-of mind for busy vocational education and training providers. Though the VET sector rightly calls to be put on an equal footing with higher education, often, we still see ourselves as a very separate market.

Perhaps we should be making more comparisons – and taking closer note of higher ed trends.

One trend is an ongoing decline in postgraduate recruitment in higher education. As detailed by education policy expert Andrew Norton, currently at the Australian National University, recruitment among domestic students declined by a total of 10 percent in the four years from 2014 and 2018.

While still high by historical standards, the enrolment drop-off occurred at the same time as there was a larger pool of potential students (which experienced a 9 percent increase at the same time).

Andrew Norton gives us a puzzling equation. More students = less enrolments. Does this add up?

Thankfully, he also suggests potential answers. What we may be seeing – and this is a trend VET can learn from – is that postgraduate enrolments are already being affected by some of the changes being wrought around us by technology and the brave new reality of work in the 2020s.

The half-life of employment skills

Research and advisory firm Gartner recently published a series of education market predictions for 2020. Among them, it said the shrinking half-life of skills should be a priority for educators around the globe. It is a problem Gartner says will affect K-12 students through to postgrads and beyond.

Highlighting the skills gap employers live with today, Gartner cited a 2018 Employee Skills Development Survey which found only 55 percent of managers thought employees actually had the skills they needed for their job. Because of the half-life of skills, that gap was expected to widen. Only 36 percent of managers said employees would have the right skills three years from now. 

The Closing the Skills Gap 2019 Research Report from Wiley Education Services backed this outlook. It found 40 percent of employers estimate a skill is now usable for four years or less. This is paired with the impact of automation, which has forced 20 percent of workers across 19 countries to upskill over the past two years because a part of their work duties had been automated.

The decline of knowledge power

Knowledge still matters. But does it pay off in real-world outcomes? That’s probably one question that occurs to students contemplating investing the time and money required to attain a postgraduate qualification. In an age where the world’s knowledge is increasingly available with a few keystrokes and the quick work of a Google algorithm, is knowing more worth more?

Gartner’s research review shows the balance is shifting from knowledge towards skills (though knowledge, of course, will still be important). For example, a Pearson report found knowledge and skills would be about equally represented in the top half of attributes required by job candidates in the US in 2030, while in the UK skills were predicted to be the prime factor ahead of knowledge.

Another in-depth 2019 research report – Future Skills: The future of Learning and Higher Education – found that 76 percent of respondents among a panel of experts agree or strongly agree with the prediction that ‘an emerging focus on future skills radically changes the current definition of graduate attributes in higher education’. Additionally, 35 percent of respondents said the change was already underway, and another 30 percent said it would be within 5 years.

The rise of the ‘how to’ economy

Gartner argues educators need to be thinking and adapting to the rise of this fast-changing ‘how to’ economy. In the case of higher education, this may require a complete overhaul of the way courses are developed and updated. Gartner pushes for a ‘pace-layering’ approach to future course development, where the half-life of courses match the half-life of the concepts and skills taught in them. This will require educators to use tools and processes that enable agile course development in shorter time-frames – with updates as frequently as every term or even every week.

Andrew Norton’s reflections on Australian postgraduate enrolments support these findings. He writes that mid-career professionals in higher education business and teaching courses, for example, are moving away from the structured education on offer, potentially in favour of sourcing skills direct via online providers. With no particular need to learn skills from recognised brands, professionals are bypassing traditional channels to attain skills on demand, and are choosing to demonstrate these skills directly to their employers in a real-world context.

“The current decline in their [postgraduate degree] market share is illustrative of the fact universities are both beneficiaries and losers as technological change affects not just what skills employees need but how they acquire them,” Norton writes. The same says pressures are affecting VET, he says. “At least eight different Australian statistical time series show this trend, which is also evident in vocational education and work-related training that does not result in a qualification… That diverse datasets all point to the same conclusion suggests that there is something going on beyond the idiosyncrasies of any one educational sector, industry, or occupation.”

Future skills are our sector’s vocation

While Norton details an enrolment decline at a time when upskilling and reskilling should theoretically be increasing (potentially showing movement towards online learning models), the environment is still highly favourable for VET providers. With the ability to capitalise on growth in professional development and lifelong education demand among workers (including demand from employers, who will be willing to pay to upskill their people), the ‘how to’ economy is something that plays directly into the hands of VET. All we need to do is follow our vocation.

Want to discover how your enterprise or RTO can adjust to these changing models? Explore how digital credentials and micro-credentials can maintain work-ready capability, or dive straight in with our digital credentials playbook.