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Issue #1585      March 13, 2013

Many apprentices live below poverty line

Independent research has revealed that many trade apprentices are living below the poverty line, with low pay a crucial tipping point that deters people from entering trades or leads to them dropping out of their training.

Apprentice wages have also failed to recognise shifting demographics, with more than a quarter of those entering trades now aged over 25.

Produced by Professor John Buchanan from the Workplace Research Centre at the School of Business at the University of Sydney, the report was released at the Electrical Trades Union’s National Apprentice Conference in Sydney last month.

Electrical Trades Union assistant national secretary Allen Hicks said that with first year apprentices now earning barely over half the pay of an unskilled burger-flipper at a fast-food retailer, it was no surprise that completion rates for apprenticeships were critically low.

“The current system is from the 1950s, when apprentices were 15 years old and lived at home with mum and dad,” Mr Hicks said.

“It has failed to address the fact that many people who want to enter trades in 2013 are aged in their 20s and 30s, and often have children and mortgages.”

He said that the system also ignores the fact that many modern apprentices are independent adults who start their trade having completed Year 12 and even holding vocational education and training qualifications.

“This report has revealed that even living an extremely frugal lifestyle, it is physically impossible for a first or second year apprentice to live independently away from the parental home in cities such as Sydney, Perth, Darwin or Canberra.”

In addition, low pay rates are putting many apprentices below the poverty line, which the report has confirmed is a crucial tipping point impacting on the take up and completion of apprenticeships.

“If it’s hard for a 17-year-old apprentice to survive, imagine what it is like for a 35-year-old with a wife and kids. It’s no surprise we are failing to entice more Australians into these vital skill areas.”

Professor Buchanan’s report includes worrying findings about the impact of current wages on meeting Australia’s ongoing skills needs.

“Financial incentives often become the tipping point which encourage young people not to take up a trade,” the report states.

“The wages and conditions of electrical apprentices are a critical factor in the recruitment and retention of apprentices, and apprentices are critical for the future skill base of Australia’s economy.”

The report is an important step in identifying how retention rates could be substantially improved.

“Adult apprentice pay rates have not even been included in all modern awards, which only exacerbates the drop in wages older apprentices often experience when they start their training,” Mr Hicks said.

“The end result is that financial constraints make it at best unattractive, and for many people impossible, to commence and complete apprenticeship training.”   

Next article – International Women’s Day – Perth

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