It is certainly not new news that Australia has a shortage of scientists, technologists, engineers and mathematicians. There is also a shortage of school, vocational and higher education teachers and students of these disciplines. The causes are no surprise: a strongly growing economy, under investment in education, particularly over the past decade, and a perception of relative unattractiveness of these disciplines as courses of study and as the basis for employment and career opportunities.

The effect of these shortages is to restrict the nation’s ability to solve many of its societal problems, threaten competitiveness and limit the ability to create future wealth.

Despite Australia being well aware of the science, technology, engineering and mathematics (STEM) skills shortages, business and political response so far has been less than comprehensive. As a short-term measure there has been a very large increase in skilled migration and the use of temporary employment visas, and in the past 12 months re-investment has begun in vocational and higher education.

Many initiatives have been put in place to reassert the importance of STEM at the individual institution, enterprise and school levels. The decision by the Academy of Technological Sciences and Engineering (ATSE) to make education one of its four priority forums is one welcome example and provides the Academy with the opportunity to reawaken public and political interest. But a broadly based intellectual and financial reinvestment in STEM is unlikely to happen in isolation from a recommitment to investment in higher and vocational education more broadly.

As an important step in identifying the quantum and operating model for re-investment, we should take the opportunity to briefly reassess Australia’s skills needs for the future.

In November 2005, the Business Higher Education Round Table (BHERT), of which I am President, hosted a summit on Emerging Skills 2020 and Beyond (the papers are at http://www.bhert.com/). The key themes presented a strong case that ‘more of the same with fine tuning’ will not provide adequate preparation for the challenges and opportunities of the future.

• More than 85 per cent of jobs in a competitive future Australia will require post-secondary education, but less than half the current working population studied beyond Years 9 and 10. “All workers are (and will be) knowledge workers.”
• More than 90 per cent of school leavers will need to complete Year 12 or equivalent, yet the figure has been stuck at 75 per cent for a decade.
• We need Australians to have the skills to work longer in life and have the flexibility to change careers. Within a career, deeper and more specialist skills will be required. Many skills cross several industries with convergence of technologies and operating systems.
• In addition to the ‘core’ academic content of disciplines, employees need to be skilled in safety, customer service, innovation and creativity, and have broader horizons beyond just the economic and shareholder value aspects of work, important as they are. The concept of ‘learning ecologies’ was described, recognising that the future will not be about ‘work/life balance’, but the interconnectedness of all aspects of people’s lives and their place within a global society and local communities.
• Workplaces will be more flexible, utilising opportunities provided by the continuing IT revolution.
• A critical mass of people with STEM skills and knowledge will be a key factor for the future.

Let us look briefly at where we are, how we got there, the size of the gap and the feasibility of closing it.

By global standards, Australia is recognised as having a reasonably good education research and teaching platform. We have examples of global excellence and are relatively free of poor facilities and highly marginalised communities, except for Indigenous Australians. Literacy and numeracy is high by world standards at the upper levels of competence, although we do have a long tail. Australia’s provision of preschool education is at the lowest level in the OECD. Schools have seen a big funding and population shift from public to private, with underinvestment in a public system that still has between 65 and 70 percent of the nation’s students.

Since the innovation of the early 1990s, our vocational education and training (VET) system has an operating model that is being copied by several countries, but has been starved of funds. VET has been regarded as the ‘second-class’ education pathway, in contrast to the culture in several of our competing and benchmark countries.

Depending on the global index used, Australia has two or three universities in the top 100 and all our universities provide good education. But investment in higher education has been on a plateau over the past decade and, alone in the OECD, public investment in higher education as a proportion of GDP has dropped. As a result, student/staff ratios have increased by more than 50 percent and universities have become too reliant on HECS fees and international student income, resulting in serious threats to quality.

Rather than advocacy, recognition of outcomes and encouragement, the political debate has an overemphasis on managerialism and ideology, combined with insufficient engagement from the business community.

In 2003, BHERT produced a publication, Leading Edge, that described many areas of public-sector research excellence. Australia’s Cooperative Research Centres (CRCs) are globally recognised and provide high returns on the dollars invested, but are under constant managerial review for survival and have limited funding horizons. Our overall R&D financial commitment is low by world standards (about 1.7 percent of GDP compared with three per cent for leading countries). Although there would be merit in focusing additional resources in developing one or two of our universities into the world’s top 10 or 20, Leading Edge output suggests there may be more merit in targeting innovation and creativity across a focused range of societal problems and economic opportunities.

The gap between the STEM higher and vocational-education systems we have and what we need and can afford is large, but Australia can close the gap if it wants to. As a precondition, education, creativity and innovation will need to gain a new level of public respect, attracting and justifying the required increased intellectual and financial investment by government, businesses and philanthropists.

Common features of previous successful changes in Australia and other countries would (when translated into a resurgence in STEM) consist of:

• forceful and sustained leadership at the political and government level – this includes a combination of a compelling ‘business case’, clarity of direction, an investment surge and a range of individual and enterprise incentives. In today’s world, this is only likely to be electorally sustained when combined with very visible leadership, advocacy and ‘skin the game’ from a range of stakeholders, including industry;
• a greatly heightened skills culture within enterprises;
• dynamic leadership, combined with financial ‘headspace’ to implement change, at educational institutions; and
• high levels of collaboration between industry, schools, higher and vocational educational institutions, and government.

When these factors have been evident, Australia has a history of implementing great change. Just two examples would be the nation’s improved sporting results following the perceived debacle at the 1976 Montreal Olympics, and the revitalisation of several industries that were pronounced to be in terminal decay in the 1970s.

Several other countries have substantially changed their educational direction, operating models and funding over the past decade. They include New Zealand, Singapore, Ireland, Finland and Denmark.

Many Australian universities and vocational education institutions are taking more ownership of their strategic direction and setting individual missions, recognising their current and future local community needs and leveraging the capabilities they have built up over decades. The Australian Technology Network of (five) universities provides specific focus in the STEM arena.

A large structural and conceptual step change is taking place in Tasmania (‘Tasmania Tomorrow’), aimed at dramatically increasing Year 12, or equivalent, completion rates and the skill levels of mature-aged Tasmanians, leading to improved individual opportunity and a step-change in productivity. Some of the Year 11 and 12 secondary colleges will become ‘academies’. A ‘polytechnic’ will be created to cover the range from Year 11 to advanced diploma, with articulation options to and from university and with strong linkages to graduate employment. A ‘training enterprise’ will deliver customised skills development to industry.

BHERT fosters collaboration between industry and academia through a combination of collaboration awards, seminars, meetings between industry, academia and ministers, position papers, and research projects on a variety of higher education issues. Examples include Emerging Skills: 2020 and Beyond, and Tomorrow’s Universities: the Need for Change in Australia. The next seminar is scheduled for February 2008 on Building Tomorrow’s Engineers. BHERT issued a 2007 election manifesto, Closing the Gap, giving a detailed academic/industry policy position.

Many examples of increasing business/academia collaboration exist in the STEM area, including the Warren Centre at the University of Sydney and the Industry Advisory Network at the University of Technology, Sydney. Fostering this kind of collaboration is another area where universities require financial headspace.

There are many examples of and ways for industry enterprises to collaborate with schools to expose students, parents and careers advisers to the world of STEM. This is particularly relevant during Years 8 to 10 to create a positive image and peer environment for STEM as an educational and career option. ATSE’s STELR project to be launched in 2008 is a great example.

The record shows that Australia can dramatically increase the contribution of science, technology, engineering and mathematics. But can it now create the necessary leadership, develop the will to foster the skills culture, and mobilise the energy to embark on the step change in collaboration?

David Hind FTSE is President of the Business Higher Education Round Table (BHERT) and was recently appointed Chair of Skills Tasmania, an independent statutory authority on skills development reporting to the Tasmanian Government. He is a director of Redkite, an organisation that provides practical support to families of children undergoing treatment for cancer. He was the final Chair of the Australian National Training Authority and in 2005 retired as managing director of Process Gas Solutions, South Pacific, part of the BOC Group. He previously held senior positions with the group in the UK, Thailand, Japan and Australia. David was a member of the Business Council of Australia from 1998 to 2005.