5 Year Productivity Inquiry: From learning to growth

Getting more value from education

High-quality school and tertiary education systems are vital for a productive workforce. But despite increased investment in schools, foundational skills such as writing and numeracy have stagnated. Employment rates for university and VET graduates have also fallen in recent years.

“Education and skills are essential for productivity growth,” Deputy Chair, Dr Alex Robson explained. “Governments spend over $100 billion a year on education and people spend many years studying. We need to get the best possible value from that investment.”

As part of its 5-year Productivity Inquiry, the Productivity Commission has today released an interim report outlining potential opportunities to improve Australia’s school and tertiary education systems.

“While overall, education outcomes are relatively good, we are seeing some concerning declines,” Dr Robson said. “Combined with a shift in the nature of skills demanded by Australian businesses, it is timely to examine where improvements can be made to improve productivity in these productivity-enhancing sectors.

“With Australia now well and truly a service economy, demand for non-routine skills is at an all-time high. This means a strong foundation from schooling is even more important than for past generations. And we need more innovation, competition and choice in our tertiary education sector.”

According to the report, schools should focus on gathering and spreading evidence to improve the quality of teaching. This could include new ideas for freeing up teachers to spend more time in the classroom and adopting proven technology or new ways of schooling to meet the needs of staff and students.

“For VET and higher education, the question is not just what to teach, but how to teach it,” Dr Robson said. “It could also be beneficial to explore current funding structures that distort the choices of students in favour of universities over VET, limit competition between providers, and restrict the number of available student places.

“There is some urgency in addressing these challenges. The population of post-school students is expected to increase by 20 per cent over the decade to 2030. This is our future workforce. The solution isn’t just simply to provide more places; the answer is also to ensure that our education system can deliver improved and relevant skills.

“Nobody can predict what some of the specific jobs of the future will look like. That is why an agile and adaptable education system is so essential for driving future productivity gains.”

Feedback on the 5-year Productivity Inquiry: From learning to growth is now invited. Submissions close on 21 October 2022 and can be made at www.pc.gov.au.

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• Preliminaries: Cover, Copyright and publication detail, Opportunity for comment, Terms of reference, Acknowledgements, Contents and Foreword
• 1. The value of human capital
  • 1.1 Education is vital for productivity
  • 1.2 What skills are needed for Australia’s future workforce?
  • 1.3 The education sector context
• 2. Building productivity in schools
  • 2.1 Lifting productivity in schools is essential
  • 2.2 Making best practice teaching common practice
  • 2.3 Leveraging digital technology in schools
  • 2.4 Making the best use of school staff
  • 2.5 Disrupting the school model?
• 3. Investing for future skill needs
  • 3.1 Challenges in managing demand for tertiary education
  • 3.2 Improving governments’ subsidy allocations
  • 3.3 Setting prices based on efficient costs
  • 3.4 Expanding access to tertiary education loans
  • 3.5 Potential support for lifelong learning
• 4. Boosting learning outcomes for tertiary students
  • 4.1 Obstacles to quality teaching
  • 4.2 Prioritising teaching quality and relevance
  • 4.3 Supporting retention and completion
• References