This week, the National Centre for Vocational Education Research (NCVER) will release its annual Total VET Activity data report. The Australian skills training system is very fortunate to have a national skills data collection and analysis agency such as NCVER that brings together and analyses data at this scale and depth. Other advanced economies do not have this capacity.
While the states and territories – and the Commonwealth too – have multiple levers that control the speed and scope of data that NCVER is able to work with, it places Australia in a good position to understand the size, scope and shape of our nation’s skills system.
The data for 2024 show that year, there were around 5.13 million students in skills training, a growth of 1.8% of the year prior, and 90.8% of those student enrolments were supported by independent skills training providers. So, what will about 2025 bring?
While certainly not having a crystal ball, there are a few things that are likely to be factors in whatever the data show later this week for the 2025 Total VET Activity data.
Strong labour market demand continues to support further growth in student numbers. While there was some moderation in employment growth through 2025, the overall labour market was comparatively tight, with continuing shortages across a range of sectors including health care, aged care, disability support, residential and civil construction, and clean energy related sectors. These are all sectors with a heavy reliance on workers from the skills training sector.
Second, the persistence of the Free-TAFE project may have stimulated participation among some learner cohorts. However, this data is not available to NCVER from the state, territory and Commonwealth governments, so any movement that might be attributable to that initiative won’t be reflected in the data released this week. What is clear however, is that in the Government-Funded students 2025 data released earlier this month, is that more funding is not equating to more students, with the number of government funded students falling by around 91,000 since 2023.
Third, there has been a greater trend for employers to support their staff in more frequent life-long learning initiatives in the skills training sector, through priority short form qualifications and skills.
On the other hand, there are factors that are likely to have softened demand and limited growth.
These include Australia’s ongoing slower overall population growth. This has the natural effect of reducing the pool of learners.
The very significant slowdown for international education in the VET sector is also a very significant factor. The 2025 year saw the lowest number of international student enrolments in the skills sector since before 2013.
Also, it may well be that a degree of the contained demand from the post-pandemic increase in skills training has now been absorbed. That would make another year of significant growth less likely and would be consistent with the deceleration evident between 2023-24.
Overall, and given these factors, it is more likely that the growth in the sector will be led by fee-paying students and businesses rather than through government funding. Overall sector growth in the region of around 2.0%-2.2% seems feasible, which would mean a total skills training sector comprising more than 5.23 million students, nearly a million more students than in 2021.
Whether Australia is able to meet our national productivity needs with a skills training sector of this size, at this growth trajectory, as the major partner in the tertiary education system is becoming an ever more pressing question.
Felix Pirie
ITECA Chief Executive Officer
Further Information —
If you have any questions regarding the above, please contact the ITECA team at [email protected] you have any questions regarding the above, please contact the ITECA team at [email protected].