A changing economy requires more workers with higher-order skills

Higher-order skills

Higher-order skills³² align with qualifications from Certificate III (plus a minimum of two years of on-the-job experience) to a Bachelor degree or higher.³³ These capture occupations such as doctors, telecommunication technical specialists, plumbers, electricians, and aircraft maintenance engineers.

Around 64% of new workers (226,000) expected over the next three years will need higher-order skills that are acquired through vocational education and training (VET) or higher education.³⁴  

Health care and social assistance is expected to have the highest number of new workers with higher-order skills (50,600). In industries like professional, scientific and technical services; information, media and telecommunications; and financial and insurance services more than 85% of new workers will require higher-order skills.

The level of qualification is a strong indicator of the need for post-secondary school education and training as the pathway to success. This also applies to existing workers, even those with existing post-secondary school qualifications. Many will need some form of additional education and training (or up-skilling) for their knowledge and skills to be contemporary for advancement in their career.

The basics also need to be right. Foundational skills – such as literacy, numeracy, basic digital and general employability skills – underpin effective engagement in education, especially in a knowledge-based economy. An integrated education and training system is a critical enabler. Regardless of the starting point, each person must be able to progress to higher learning without the barriers often needlessly imposed because of differences across education sectors.

Qualifications required for each skill level

Higher-order skills

Skill level 1

A bachelor’s degree or higher.

Skill level 2

An associate degree, advanced diploma or diploma.

Skill level 3

Certificate III (including at least two years of on-the-job training) or Certificate IV.

Other skills

Skill level 4

Certificate II or III.

Skill level 5

Certificate I or compulsory secondary education.

Notes

³² Higher order skills are occupations with skill levels 1 to 3.

³³ Experience may substitute for formal qualification, or in other cases relevant experience may be required in addition to the formal qualification.

³⁴ Employment forecasts for skill levels are derived based on 4-digit ANZSCO occupation employment forecasts from the Victorian Skills Authority. For 22 of the 358 4-digit ANZSCO occupations that had more than 1 skill level, skill levels were assigned based on the predominant skill level of the occupation.