Education providers

VET health check: COVID’s impact on the sector

30 January 2022

4 mins read

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The impact of COVID-19 continues across our lives, requiring constant adaptation and making it difficult to plan.

The vocational education and training (VET) sector is facing particular challenges, mainly related to online learning. At the same time, critical skill gaps present providers with opportunities to respond to industry needs.

In our role as education finance specialists, we are connected to hundreds of providers throughout Australia. To help them gain deeper insight at this uncertain time, we have summarised the key findings from three recent analyses of COVID’s impact on VET, published by ASQA, the OECD, and AISC. We hope you find this sector health check useful.


Signs of adaptation and provider opportunities
The sector has shown early signs of strong adaptation. The Australian Skills Quality Authority’s (ASQA) interim report on provider activity showed that most were planning to adjust delivery to be COVID-safe and/or adding additional training.


From 23 March to 31 December 2020, ASQA received:

  • 11 notifications from providers closing due to COVID-19
  • 53 notifications from providers closing temporarily
  • 1,220 notifications from providers planning to vary their delivery to be COVID-safe
  • 8,026 applications from 1,381 providers to add qualifications, courses, or units of competency


ASQA and the Australian Industry and Skills Committee (AISC) have both identified emerging skill gaps and priority areas that present opportunities for VET providers. They include:

  • Aged care, disability support, and healthcare
  • Infection control training
  • Digital and cyber security
  • Teacher/trainer courses in online delivery
  • Training in managing disrespectful, aggressive or abusive customers
  • Employability/enterprise skills due to the increase in job seekers


ASQA has cautioned providers not to fill gaps with unregistered training as it can harm student outcomes and provider reputation. Visit its COVID-19 support page for more information.


ASQA recommends consulting with industry on new training so it meets their needs and ensuring you have adequate resources to deliver it, including skilled trainers.


Online learning challenges VET providers globally
Digital learning using current technologies is better suited to academic learning. In its report, Implications of the COVID-19 Pandemic for Vocational Education and Training, the OECD found that VET providers struggled to use online learning for practical teachings, which tend to dominate VET courses.

Some countries responded by prioritising VET when reopening, some lost nearly an entire year of learning and others – most prominently, Poland – adopted a hybrid model with in-person classes for practical components and remote learning for theory based elements.

The OECD found that VET providers in all countries it surveyed adopted online learning platforms. In addition:

  • 78% used take-home packages
  • 74% used mobile phones
  • 70% used television
  • 35% used radio
  • 29% used other forms of distance learning


The OECD also found that teachers needed support with remote teaching as many had limited experience in it. Australia’s TAFE system put teams in place to help teachers move to online delivery, focusing on content design, technology platform use, virtual classroom management, best-practice digital delivery and troubleshooting (TAFE Directors Australia, 2020).


“In Australia, only 19% of the 1200 courses delivered in TAFE institutes had some form of digital delivery before the pandemic.”
TAFE Directors Australia, 2020


Solutions sought for work-based learning
With work-based learning limited during the pandemic, providers and governments took various actions to support the VET sector. The OECD found that governments and other key stakeholders in some countries responded by introducing more flexibility to work-based learning. For example, apprentices in France were able to take up to six months to find an apprenticeship contract, instead of three. Chile reduced the minimum number of apprenticeship hours from 360 to 180.

Several countries introduced or scaled up financial incentives to support employers in providing work-based learning opportunities, including Australia, Austria, France, Germany, Ireland, and Luxembourg.


“In Australia, the $2.8 billion Supporting Apprentices and Trainees wage subsidy is expected to help up to 90,000 employers keep about 180,000 apprentices and trainees across the country in work and training.”
Implications of the COVID-19 Pandemic for Vocational Education and Training, OECD


However, the OECD report cautions against financial incentives, noting:

  • Firms face other barriers that need to be addressed, such as lack of skills and experience to effectively train students and manage the associated admin load
  • Financial incentives are not sustainable for many governments facing severe budget pressures due to COVID-19
  • It’s difficult to cost-efficiently prevent those employers who don’t need the financial support from accessing it
  • International experience shows financial incentives need to be carefully evaluated based on policy objectives


Work-based learning impacts could worsen
It is possible the pandemic could lead to further reductions in VET work-based learning opportunities, beyond the impact of COVID-safe restrictions on workplaces.

The OECD report noted that previous economic recessions have tended to affect apprenticeships more than regular jobs. It said the current crisis could affect work-based learning further because of uncertainty about subsequent waves of the pandemic and because digitisation introduced to workplaces during the crisis could remain.

Shortages of work-based learning opportunities could prevent current students from graduating and affect future enrolments if prospective students think work-based learning might not be possible.


“It has been estimated that the offer of apprenticeships and traineeship opportunities in Australia will be reduced by 30% over two years. This represents about 130,000 fewer places available from the start of the pandemic until mid 2023.”
Implications of the COVID-19 Pandemic for Vocational Education and Training, OECD


The report said recent data showed apprenticeship and traineeship commencements in Australia were 18.8% lower in the 12 months ending 30 September 2020 than in the year before. The fall was larger in non-trade occupations.

However, not all countries experienced a drop in work-based learning opportunities. Participation was stable in Switzerland and in France, the number of apprenticeship contracts finished in 2020 was higher than in 2019, partially reflecting incentives introduced during the pandemic.


Sector recovery important for the economy
While VET has been significantly affected by the pandemic, the sector is also a key pathway to our economic recovery from it.

The OECD’s international comparisons show that high-quality vocational education is the cornerstone of transitioning young people into jobs. Its report notes that VET can play a key role in the recovery from the COVID-19 crisis, by equipping students with the skills the labour market needs and providing adults with relevant up-skilling and re-skilling opportunities.

In order to do this, the sector must respond to the emerging skill gaps and priority areas covered above. It also needs to be responsive and flexible to ensure content and delivery is relevant and accessible. Emerging technology could play an important role here, especially augmented or virtual reality technology that can deliver practical learning remotely.

As a final note, ASQA and AISC are collecting feedback on the pandemic’s impact on providers. If you would like to contribute, please complete the online forms.


If you would like to discuss education finance solutions to attract and retain students, please get in touch.

Alternatively, check out our suite of innovative finance solutions for Education Providers here.


This article summarises findings from:
–  The OECD’s report: Implications of the COVID-19 Pandemic for Vocational Education and Training
–  ASQA’s pandemic challenge assessment
–  AISC’s COVID-19 priority issues