AVIATION IRC SKILLS FORECAST

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1 AVIATION IRC SKILLS FORECAST KEY FINDINGS DISCUSSION PAPER 2017

2 KEY FINDINGS DISCUSSION PAPER MARCH 2017 The purpose of the paper is to provide industry stakeholders with a summary of the key findings from the recent industry intelligence gathering activities overseen by the Aviation Industry Reference Committee (IRC). The key findings will be used by the IRC in the development of the Aviation IRC Skills Forecast and Proposed Schedule of Work for the Aviation Training Package. Once approved by the Australian Industry and Skills Committee (AISC) the Skills Forecast will replace the 2016 Aviation IRC Workplan. Several targeted strategies were employed to collect industry intelligence about the opportunities and challenges for the Aviation workforce and any Training Package review work necessary to meet these industry needs. These included: A Call for Submissions process inviting stakeholder responses about key issues affecting skills and workforce development; An IRC Skills Forecast Survey seeking information on priority skill needs, skill shortages and issues relating to workforce training and; A comprehensive review of Data and Research Sources nominated by the Aviation IRC Australian Industry Standards has been tasked by the IRC to collect feedback from interested stakeholders about these issues on its behalf. HOW TO PROVIDE FEEDBACK Stakeholders are invited to submit their comments on the findings outlined in this paper by close of business on March 17th It is acknowledged that the information provided about issues in this paper is deliberately brief. The purpose of this paper is to validate and confirm the findings, which will inform the advice the Aviation IRC will provide to the AISC. In considering the key issues and themes identified in this paper, we are keen to have any feedback that either confirms your issue has been covered, or else raises an issue you feel should be addressed in the Proposed Schedule of Work (FY17/18 FY20/21) for the Aviation Training Package to be submitted to the AISC on April 28th Responses can be ed to enquiries@australianindustrystandards.org.au For further information please contact: Dan Minton Industry Manager P (03) M Aviation IRC Key Findings Paper March 2017 Australian Industry Standards Ltd. 1

3 AVIATION INDUSTRY OVERVIEW The Aviation industry underpins Australian business and tourism and has an estimated annual revenue of $44.79 billion, adding $15.73 billion to the Australian economy in The industry employs more than 88,000 people across its five main sub-sectors: Domestic commercial aviation, international commercial aviation, general aviation, air-freight transport and aviation support infrastructure. AVIATION INDUSTRY METRICS Revenue ($b) Profit ($m) 3935 Average Wage ($ per year) 80, No of Businesses 1860 Employment Growth (% to 2022) 8.5 Scope: International Airlines, Domestic Airlines, Airport Operations, Non-Scheduled Air Transport 1 The change in employment growth since the 2016 Aviation IRC Workplan is primarily attributed to employment growth in international airlines, where over the next five years a projected rise in the number of international tourists is expected due to factors including growth in Asia, and an anticipated fall in the Australian dollar over the same period. DOMESTIC AVIATION : million passengers carried, 1.8 per cent aircraft trips, 0.2 per cent 8.80 million passengers travelled Melbourne Sydney, Australia s busiest route, of 4.0 per cent million passenger movements - Sydney remains Australia s busiest domestic airport million domestic aviation passengers travelled through regional airports 2 INTERNATIONAL AIRLINE ACTIVITY IN AUSTRALIA international scheduled airlines operated services to/from Australia million international scheduled passengers, 7.0 per cent tonnes international scheduled air freight traffic, 6.0 per cent Top five countries in terms of on board passenger movements: New Zealand, Singapore, United Arab Emirates, USA, and Indonesia 3 1 IBISWorld Industry Reports. Retrieved from 2 Bureau of Infrastructure, Transport and Regional Economics (BITRE), 2016, Domestic aviation activity, Statistical Report, BITRE, Canberra ACT. 3 Bureau of Infrastructure, Transport and Regional Economics (BITRE), 2016, International airline activity, Statistical Report, BITRE, Canberra ACT. Aviation IRC Key Findings Paper March 2017 Australian Industry Standards Ltd. 2

4 AVIATION WORKFORCE AVIATION WORKFORCE NSW QLD VIC WA SA NT ACT TAS 1,100 2,300 1,900 1,850 7,175 Source: ABS Labour Force, Australia, Detailed, Quarterly, Nov 2016 AVIATION SKILL SHORTAGES 14,625 16,375 20, per cent of employers reported experiencing a skills shortage in the last 12 months 4. The occupations reported as being in shortage were: 1. Trainers/Instructors all types 2. Aviation Maintenance Engineers 3. Aerodrome personnel - Reporting Officer, Work Safety Officer, WHS Co-ordinators/Managers 4. Personnel with experience in new technology workers and instructors Employers identified the following reasons for the shortage with the most frequent response listed first. Reasons for shortage Shortage of skilled/qualified personnel Ageing workforce/current staff retiring Remuneration/employment conditions Cost/time to achieve the required qualification Competition from other organisations 4 Australian Industry Standards. IRC Skills Forecast Survey. February Aviation IRC Key Findings Paper March 2017 Australian Industry Standards Ltd. 3

5 KEY AVIATION SKILL ISSUES INTERNATIONAL AVIATION GROWTH Driven by regional economic growth, higher disposable incomes in emerging markets and increased air travel in developing economies, the international aviation market is forecast to continue growth for some time. Shifts in global economic power and demographics, accelerating urbanisation in emerging economies, rapid population growth and rising incomes in these countries, are creating a larger middle class with greater consumption needs and an appetite for travel. Airlines face greater competition for skilled labour, with this already evident for qualified pilots and engineers. Many developing countries are raising pilot wages to attract foreign-trained talent to support their growth. 5 SERVICE DIFFERENTIATION There is a trend toward greater differentiation in service levels provided to airline customers, improving service to the highest revenue customers while unbundling services at the low end of the market to serve price-sensitive customers. This has a flow on to the skills required by the workforce operating in this more differentiated environment. Customer service, problem solving and adaptability skills on top of the technical demands of the role become even more important. EMERGING TECHNOLOGY Aviation businesses are investing in information-based technologies which provide them with opportunities to streamline and automate manual processes and redeploy labour to more valueadded activities such as personalised service offerings. These technologically-driven solutions provide new career paths for existing employees through upskilling opportunities in analytics statistics, information management and mobile applications development and implementation. Employer concerns about the digital skills capability of key segments of the workforce and the impact of the rate of technological change on these workers are noteworthy. 5 PwC. Tailwinds airline industry trends. June Aviation IRC Key Findings Paper March 2017 Australian Industry Standards Ltd. 4

6 KEY AVIATION SKILL ISSUES AVIATION SAFETY REGULATION REFORM The Civil Aviation Safety Authority s (CASA) Part 61 Taskforce released its final report in February An amendment package for the flight crew licensing regulations is proposed early Most of the amendments will address issues that have already been resolved through exemption and approval instruments, and repair other issues where unintended consequences have been identified that need to be resolved. The next steps include further consultation, and legislative drafting as well as implementation planning and preparations. CASA s formal industry consultation process will be used to communicate proposed amendments to the aviation community. The impact of these changes for aviation businesses, training organisations and the workforce will be ongoing. RPAS/UAS/DRONES Remotely Piloted Aircraft Systems (RPAS) is the fastest growing area in civil aviation and this technology is expected to play an increasingly significant role in the aviation industry over the next 20 years. RPAS operations are also offering enormous opportunities across a wide range of other industry sectors and like any rapidly emerging technology, they are challenging existing policy and regulatory frameworks. Regulatory changes were introduced in September 2016 which aim to reduce the regulatory burden for low risk unmanned aircraft operations and facilitate growth and innovation in the sector. A review of aviation safety regulations for the operation of remotely piloted aircraft systems has been announced for early The number of remote pilot licenses issued by CASA has grown from fewer than 100 three years ago, to more than 4,000 today, while nearly 900 organisations are now certified to carry out commercial drone activities. 8 6 CASA, Part 61 Solution Taskforce Report. February CASA. Media release: New drone rules cut red tape. Wednesday, 28 September Australian Financial Review. Drones flying into regions, but improvements needed for cities. Friday, 17 February Aviation IRC Key Findings Paper March 2017 Australian Industry Standards Ltd. 5

7 KEY AVIATION SKILL ISSUES TRAINER/INSTRUCTOR SHORTAGES While commercial Aeroplane and Helicopter Pilots are in high demand, the occupation cannot be qualified as being in shortage due to the large number of candidates with basic licences and skill sets acquired as recreational or General Aviation (GA) Pilots. With the number of pilots predicted to increase substantially in the medium to long term, the need for qualified and appropriately skilled Flight Instructors, Flight Examiners and Flight Operations Inspectors has increased. There is a demonstrated chronic shortage of Flight Instructors and Flight Examiners for both aeroplanes and helicopters. Similar shortages are experienced in other countries, with fierce competition for some specialist skill sets. Multi-crew training and advanced simulator training skills are in particularly high demand 9. The offshoring and/or outsourcing of aircraft maintenance functions by Australian airlines in recent years has had a tremendous effect on the maintenance engineering training landscape. Several generalist engineering training providers have stopped their Aviation courses. There is significant concern within the industry that closing engineering training facilities will impede the ability of training providers and maintenance businesses to rebound or take advantage of international growth opportunities. Aviation maintenance training schools have raised significant concerns about the impact of regulatory compliance (Aviation and Vocational Education and Training (VET)) costs on their ongoing business viability. AERODROME OPERATIONS There is strong demand for ground operations occupations at airports, including Aircraft Baggage Handlers, Airline Ground Crew, Load Controllers, and Airports Works Safety Officers. The demand for these occupations is primarily driven by airport growth, with most major capital city airports being expanded or planned for expansion. High staff turnover rates are a challenge and risk for the viability of aerodrome operations. The annual employee replacement rate is estimated to be 25 per cent, indicating a lack of depth and experience in many operational and support roles. 10 Challenging market conditions remain for regional and remote aerodromes, from both financial and workforce perspectives. 9 Australian Industry Standards. Aviation Workforce Skills Study Australian Industry Standards. Aviation Workforce Skills Study Aviation IRC Key Findings Paper March 2017 Australian Industry Standards Ltd. 6

8 KEY AVIATION SKILL ISSUES TRAINING COSTS Training providers overwhelmingly estimate that, while aviation flight training in Australia is widely recognised as being high-quality compared with other countries, this quality comes at a high financial cost. The poaching of qualified pilots is an issue affecting industry s willingness to invest in training. The current cost barriers faced by individuals and businesses are well understood. However, there is a need for the industry to invest more in upskilling its current and future workforce through public and private funding mechanisms. Flight training schools have raised significant concerns regarding the dual costs of maintaining separate RTO and Flying School accreditation, with many questioning the cost/benefit ratio of continued operations. High compliance costs drive up training costs, which flow onto the Aviation industry. INTERNATIONAL OPPORTUNITIES Strong international opportunities exist for Australian aviation training providers, both in terms of overseas operations and involvement in aviation capacity building efforts of other nations. In the field of aircraft manufacturing and engineering, Australia is considered a leader in the provision of through-life services, particularly applied to military aircraft. In addition, there are several engineering and engineering training areas in which Australia possesses significant, internationally-recognised expertise that holds sizeable potential for international growth. Aviation IRC Key Findings Paper March 2017 Australian Industry Standards Ltd. 7

9 PRIORITY SKILLS The priority skills results are drawn from Aviation stakeholder responses to the IRC Skills Forecast survey conducted in February In order of priority to the industry, the following skills were identified as the most important for the Aviation workforce within the next three to five years. SKILL CATEGORY Technical Collaboration / social skills Piloting Commercial Compliance Ranking of the 12 generic workforce skills in order of importance to the Aviation industry. GENERIC SKILL Managerial/Leadership Technology Science, Technology, Engineering, Mathematics (STEM) Design mindset/thinking critically/system thinking/solving problems Communication/Virtual collaboration/social intelligence Language, Literacy and Numeracy (LLN) Learning agility/information literacy/intellectual autonomy and self-management Customer service/marketing Financial Data analysis Entrepreneurial Environmental and Sustainability Aviation IRC Key Findings Paper March 2017 Australian Industry Standards Ltd. 8

10 BACKGROUND INFORMATION INDUSTRY REFERENCE COMMITTEES New arrangements for training product development commenced in January These arrangements consider the needs of employers of all sizes, across all industry sectors, and ensure the delivery of high quality Training Packages that are nationally endorsed and internationally regarded. Industry References Committees (IRCs): Provide a forum for industry engagement. Direct the review, development and implementation of training package content relevant to the industry sectors they cover. Act as a conduit for industry feedback to the Australian Industry and Skills Committee (AISC) and governments on industry trends. IRCs are composed of individuals and industry members with the experience, skills and knowledge of their particular industry sector. IRCs are supported by independent and professional Skills Service Organisations (SSO) to develop and review Training Packages, and to inform Training Package development priorities. IRCs have a direct relationship with the AISC, and are charged with identifying industry s skills needs, developing business cases setting out the case for change, and providing the sign off on training products before they go to the AISC for consideration. Each IRC will perform the following functions; Gather intelligence for their industry sectors to inform advice on Training Package development and review. Direct the work of its SSO in the development of industry proposals, cases for change and cases for endorsement. Oversight the development and review of Training Packages in line with the requirements of the AISC. Provide sign off for industry proposals, cases for change, cases for endorsement and other submissions for consideration by the AISC. Direct the work of the SSO in preparing the support materials where funding for additional activities is provided. Report to the AISC on progress of its work. Promote the use of Vocational Education and Training (VET) in the sectors they represent. Aviation IRC Key Findings Paper March 2017 Australian Industry Standards Ltd. 9

11 BACKGROUND INFORMATION AVIATION INDUSTRY REFERENCE COMMITTEE The Aviation Industry Reference Committee (IRC) has been assigned responsibility for the AVI Aviation Training Package. Chair: Adam Burford, Aviation/Aerospace Australia Deputy Chair: Doug Nancarrow, Safeskies The AVI Aviation Training Package provides the only nationally recognised Vocational Education and Training (VET) qualifications for occupations involved in: Aerodrome Operations, Airport Safety, Ground Operations, Cargo Services, Customer Service, Aviation Transport Protection, Aviation Search and Rescue, Management and Supervision, Air Traffic Control, Flight Operations (Pilots aeroplane, helicopter, commercial, military, remote and pilot in command) and Flight Instruction. The AVI Aviation Training Package comprises 21 qualifications, 44 skill sets, 216 units of competency and associated assessment requirements and covers Aviation Safety, Ground Operations and Flight Operations. The AVI Aviation Training Package is in the Scope of Registration of 80 Registered Training Organisations. Aviation IRC Key Findings Paper March 2017 Australian Industry Standards Ltd. 10

12 BACKGROUND INFORMATION IRC SKILLS FORECAST & PROPOSED SCHEDULE OF WORK The IRC Skills Forecasts focus on the prioritisation of the skill needs of the industry sectors each IRC has responsibility for. They are developed and reviewed annually in consultation with industry stakeholders, and submitted on behalf of the IRC to the Australian Industry and Skills Committee (AISC) for approval. IRCs are required to consult broadly with stakeholders to ensure a whole-of-industry view about the opportunities and challenges for the workforce and the Training Package review work necessary to meet industry needs. The IRC Skills Forecast is submitted to the AISC to inform the development of a four-year rolling National Schedule for Training Package development and review work. More information on the National Schedule can be found at: AUSTRALIAN INDUSTRY STANDARDS Australian Industry Standards (AIS) provides high-quality, professional secretariat services to the Aviation Industry Reference Committee, in our role as a Skills Service Organisation. AIS provide services to eleven allocated IRCs which also cover the Gas, Electricity, Electrotechnology, Corrections, Public Safety (including Police, Fire and Emergency Services, Defence), Water, Transport and Logistics, Rail and Maritime industries. AIS supports these important industry sectors using our world class in-house capability and capacity in technical writing, quality assurance, project management and industry engagement in the production of training packages. AIS was established in early 2016, 20 years after its predecessor the Transport and Logistics Industry Skills Council (TLISC) was established in More information about AIS can be found at We support industry growth and productivity through our modern innovative approach to establishing skills standards. We provide high-quality, professional secretariat services to help our allocated industry reference committees develop the skills that industry needs. We partner with industry to shape the workforce of the future. Aviation IRC Key Findings Paper March 2017 Australian Industry Standards Ltd. 11

13 P: (03) E: W: twitter.com/ausindstds Level 2, 31 Market Street, South Melbourne, Victoria 3205 Aviation IRC Key Findings Paper March 2017 Australian Industry Standards Ltd. 12

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