We’re living in a rapidly changing world.

Dramatic changes in technology, shifts in industry demands and changing labour market conditions are pushing Australians to look beyond traditional learning.

No one can predict how exactly these changes will impact us. But one thing is certain — as learners, we need to be malleable to thrive in disruption.

Our future calls for the most skilled, adaptable workforce yet. And micro-credentials are the building blocks that will set the foundation.

There is a clear urgency for policymakers to consider how and where these short courses sit in the education system. The Australian government now recognises that upskilling promotes a resilient workforce. This has initiated a push to fast-track micro-credentials in VET to “respond more effectively to the needs of students and employers” — a central focus in 2021. (COAG Skills Council 2019)

Since our last handbook, micro-credentials have evolved, but the onus remains the same — to offer learners newer, more customisable training opportunities that exist outside of the traditional tertiary education system.

With these recommendations, providers can fill these identified gaps and offer a tailored learning experience set to mould a resilient, future-proof workforce.

As a refresher, micro-credentials are short qualifications designed to help learners skill up in specific knowledge areas.

A micro-credential can take two forms:

There are now two new micro-credential subcategories that are an extension to the above:

A subject bundle is when a student enrols into a collection of three or fewer subjects.

According to Bryan Palmer’s research report, ‘An Analysis of Micro-credentials in VET’, these ‘bundles’ are undertaken at a single registered training organisation (RTO), defined as ‘RTO-student pairs’.

Palmer’s study unpacks popular learning areas that exist outside of a nationally recognised program in VET, assessing the “extent of skill sets or micro-credentials being taken by students in 2019”.

These bundles represent a combination of subjects that are performing as credentials in the current marketplace.

Out of the 4.2 million students captured by the Total VET Students and Courses data, almost 63% undertook a subject bundle. Enrolment in other recognised forms of short course training pales in comparison, with “76,565 students enrolled in training package skill sets and 93,555 in accredited courses”.

The role of micro-credentials in VET
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More than “93% of bundles [are] funded on a fee-for-service basis”, with a primary focus on regulation and skills maintenance. This implies that employers and individual learners are funding these grouped qualifications due to regulatory requirements.

NCVER data showed the need to refresh existing knowledge has resulted in high engagement in some subject bundles.

For example, the largest subject bundle includes cardiopulmonary resuscitation as a unit, which is only valid for 12 months. The second-largest, the first aid certificate, must be refreshed every three years.

It was found that many of the popular subject bundles analysed were centred around workplace safety, emergency preparedness and authorisation to operate dangerous equipment.

There is a market operating around meeting codes of practice and competencies for specific jobs. Many subject bundles are ‘mandated’ to ensure regulatory requirements are being met in the workplace.

These findings emphasise the opportunity for governments to fund micro-credential courses to promote job readiness and lifelong employment.

Providers could see a flow-on effect from this government opportunity. Government participation in expanding subject bundles beyond regulatory activity prompts a more stimulated market — heightening the demand for these kinds of short courses.

This segment currently appears as a largely ‘private’ market with little to no government intervention, despite its existence attributed mainly to government regulations around specific VET requirements for a wide range of jobs.

The NCVER’s 2020 National Student Outcomes Survey suggests that 9.2% of subject bundle training was paid for by the government.

Despite this, some fee-for-service courses may still have been indirectly funded through the government. One scenario might be that an independent agent such as an employment service provider funded a subject bundle (labelled as fee-for-service), despite receiving government funding for this training.

This observation tells us that government funding does play a small role in driving motivation to study subject bundles. Data collected is more focused on units that are mandated in particular contexts, and do not necessarily align with ‘skills of the future’, such as digital literacy, soft skills or new technology skills.

Knowing the effect that funding plays on the propensity to study, the government can also stimulate training in skills gap areas set to boost the economy by injecting funds into micro-credentials.

With this boost, providers should also feel positive effects.

Although micro-credential funding details are yet to be announced, there is a good chance that RTOs will see funding allocation set towards responding to emerging skills needs (micro-credential or equivalent courses).

Private providers should also see some uplift in interest, as not all learners may be seeking funded learning.

Similarly to micro-credentials, micro-apprenticeships are short, practical qualifications.

They’re designed to “bridge the growing gap between demand for expertise in new technologies and the lack of workers with relevant technical qualifications”.

Micro-apprenticeships echo the sentiment from our last micro-credentials handbook — the skills and training system requires a complete overhaul to promote the shift towards preparing workers for their future. Technological disruptions are forcing rapid change in workplaces and reinforcing the need for new combinations of skillsets.

These qualifications would combine work experience with short, digitally-focused online courses that are “tailored to the needs of both learners and their employer”. Like a ‘digital trade’, micro-apprenticeships present workers in emerging fields with the opportunity to gain hands-on experience in a practical environment.

According to Julie Hare at the Australian Financial Review (AFR), micro-apprenticeships are one solution to fast-track VET reforms for a “rapid and sustainable economic recovery post-COVID”.

Their design would help to promptly address current skills shortages and advocate for a “more modular and flexible skills system in the future”.

In the report, ‘Skills, training, opportunities crucial to filling the jobs gap’, the BCA has suggested a national digital skills passport that acts as a ‘single source of truth’ for all kinds of education and training. It would include formal and informal learning, incorporating micro-credentials, micro-apprenticeships and other short course equivalents to create a complimentary, lifelong learning experience.

The BCA explains this lifelong skills passport would mitigate “the maze of standards” that currently exists in qualification recognition. The digital document would stay with a person from high school all the way to retirement. It would track qualifications and provide employers with a quick solution to determine whether a candidate has the right skill level and competencies for a role.

Introducing a digital skills passport further promotes the shift to ‘stackable learning’ — helping workers skill-up to meet evolving business needs and allowing employers to source appropriately skilled employees.

Business Council of Australia

Universities have begun creating their own stackable micro-credential programs that are flexible enough to satisfy the needs of all students — whether they are purely looking to upskill with a micro-credential style course or are looking for pathway options that ultimately lead them to a formal qualification.

Leading by example, these institutions offer providers some inspiration to feed micro-credentials into their own curriculum.

RMIT Online has taken micro-credentials one step further with its own stackable learning model.

Students can study a selection of Future Skills courses (or one subject of approved post-graduate qualifications) as part of a two-course combination. The combination is worth 12 credit points that can be transferred to specified degrees at RMIT University.

Future Skills includes approved credit pathways to RMIT programs within the College of Business and Law (COBL) and College of Design and Social Context (DSC), which are more likely to be added in the near future.

The future-focused program has fused two very different types of learning experiences in a flexible format that supports both individuals and Australia’s economic recovery. It has been built specifically to promote lifelong learning journeys that are customised to a student’s unique requirements.

We know traditional degree structures in isolation are becoming a thing of the past.

Flexible learning options are becoming the norm — providers must reimagine education by moulding their courses to the learner’s needs and the future workforce.

Our 2020 handbook uncovered ‘unbundled’ learning pathways as an opportunity for providers looking to expand into the micro-credentials space. Providers can unpack their existing qualifications into separate components for a more customised learning experience (reverse subject bundles).

The potential risk with this process is that there is no one defined way for stakeholders such as employers to understand the value of the variety of credentials currently in the market.

However, the abundance of discussion and research in the space, especially in the last few months, suggests that we are on the cusp of receiving standardised frameworks and set practices to develop and teach micro-credentials effectively. These frameworks will help clarify where micro-credentials sit in the broader education landscape and how they interact with other learning forms.

Providers should begin thinking about:

Gaining an understanding of the above will help to define how micro-credentials are set to blend with providers’ learning curriculums once a more defined framework is released.

A catalyst for drastic change, COVID-19 has sparked massive responses to the current state of the education sector.

Short course training is more important than ever — governments are promoting this type of training to help combat the social and economic impacts of the pandemic.

Disruption in the labour market, changing skills needs, and urgency around quickly adapting future workers for job changes post-pandemic have shown an
“enormous amount of effort and policy and funding going towards micro-credentials”.

NCVER data showed that training package skillsets
increased by 128% from January to September 2020, compared to the same nine months in 2019. Our COVID-19 2020 survey data also shows students demonstrating more propensity to study compared to pre-COVID:

The NCVER report also found that non-formal, government-developed skillsets “jumped by 171% in those nine months, partly stimulated by the job trainer initiative, which was about a billion dollars collectively between all governments that started coming”.

Our Student Sentiment Index 2020 data reinforces student reliance on government funding, with young people aged 18 to 24 and older people aged 45 to 65 feeling the most significant impacts during the height of the pandemic.

Abnormal displays of high sensitivity to funding in March 2020 suggests factors such as higher rates of unemployment, lower wages and higher costs of living all played a part in student reliance on funding during this period.

COVID-19 has expedited the need for micro-credentials to satisfy emerging industry needs in Australia’s post-pandemic economic recovery.

The urgency for future skills presents an opportunity for providers to fill the ‘education gap’. Providers can develop micro-credential qualifications to create a bridge to meet these demands.

By offering upskillers with refresher training on competencies they might already have, providers can facilitate this much-needed shift. This kind of training will elevate learner skillsets — helping them move from a job that is becoming redundant to one that is in demand.

The new National Skills Agreement (NSA) has committed to “developing and funding nationally accredited micro-credentials and individual skill sets”, with a key focus on supporting “lifelong learning through an integrated tertiary education system”.

The NSA will replace the National Agreement for Skills and Workforce Development (NASWD) and is due to be finalised in August 2021.

Micro-credentials have sparked a remarkable shift in the way we learn.

The push towards these skills-focused courses reinforces the widespread urgency to keep up with industry demands on professional development. It’s no secret that we can no longer depend on traditional learning to carry us into the workforce of the future.

Education providers have the chance to empower learners by promoting a more personalised way of learning.

It’s time to advocate for the tools set to build a more resilient workforce.