Government’s changes in the universities fees to address skill shortages can backfire

In 2020, the government changed university fees to encourage students to study courses where the government predicts there will be a future demand for jobs. This policy decision by the governmentis considered beneficial for some while a burden for others. Especially students in humanities, arts, commerce, economics, and law will bear the burden of the fee hike. The government aims to navigate the students’ skills to meet the future demand for jobs. However, this carrot-and-stick approach might prove futile, as it creates a disparity amongst students. The Australian economy endured the Covid-19 downturn but the rising cost of living with a higher inflation rate has already crippled the purchasing power of an average Australian. An additional burden of fee rise in some courses is a double whammy. The students belonging to the disadvantaged groups are on the losing ends. This policy could be fraught with dangers of inequalities within Australia.

Let’s not forget that women and youth employment trends are the most adversely affected by the Covid-19. Fee discrepancy can hurt women and young people more than ever. The facts and prevailing scenario require a holistic approach rather than desperately aiming for future growth.Hoping students will be compelled to choose cheaper courses is somewhat of a passive approach. Naively waiting for students to choose STEM courses instead of humanities and social sciences is justnot the best move. The government has so much more to do to fill the gaps for increasing productivity.

Rather than focusing on the supply side of skills why not focus on the demand side of skills? Why doesn’t the government focus on strengthening the existing jobs? The Australian workforce is currently in the dire need of workers of all skills and not just ‘high skilled’. Especially the low-skilled workers in hospitality, aged and disability care, and construction. The government should create additional jobs in these areas and upskill the existing workers.

Focusing merely on the high-skilled jobs to boost productivity can also lead to job polarization, which occurs when middle-income jobs tend to vanish and labour market is divided into high-skilled jobs and low-skilled jobs, thereby increasing income inequalities.

Changing the fee structure will add more confusion for Australians who need clarity in government decisions post-pandemic. Government having long-term plans and strategic solutions can give students time in directing their career trajectories. More time will also help the universities in planning their financial viability for any fee changes.Instead of having a rigid approach to changing fees and breeding inequality the government can be creative in resolving the skills enigma.

Skills shortages can be tackled by improving the existing curriculum. Adding technically advanced knowledge to the existing courses can substantiate skills required for future jobs. Abrupt decisions can have lingering consequences, the government must take baby steps toward gradual improvements in tertiary education.