Australian Industry Group welcomes the announcement that financial incentives for employers who take on apprentices in the housing and new energy sectors will continue at the same level in 2026, but is concerned that support will significantly reduce for those who employ apprentices and trainees in other sectors.
The Federal Government has announced today that from 1 January 2026 to 31 December 2026, apprenticeship incentives for many employers will change. Currently, incentives for employers who take on apprentices and trainees in priority occupations are worth $5,000. For those priority occupations in the clean energy and housing sectors, the incentive will remain unchanged. For other priority occupations, the incentive will be reduced to $2,500. For those occupations not on the priority list, no incentive is available.
"While we welcome the continuing support for priority areas such as housing and clean energy, these changes will make taking on an apprentice less affordable in other industries important for lifting our sovereign manufacturing capability and delivering high-quality services in the community and aged care sectors," said Innes Willox, Chief Executive of the national employer association, Australian Industry Group.
"For those occupations not on the priority list who will receive no incentives, we can anticipate further reductions in the structured work-based training that an apprenticeship or traineeship provides. The impact this will have on important skills and sectors of the workforce is of deep concern.
"Also of concern is that these changes have been announced only a month before their implementation and at a time when employers are actively determining their workforce needs for the year ahead.
"Our survey of employers conducted earlier this year showed that half indicated that their employment of apprentices and trainees would reduce if they no longer received financial incentives. The overwhelming feedback from employers was that apprenticeships are becoming too costly. Financial incentives have never addressed the full cost of employing apprentices, but they form part of the economic equation. Each change downwards will represent the final straw for some employers.
"We would encourage the Government to consider broadening the occupations it considers as key. The 'Future Made in Australia' is an important initiative in the move to clean energy, but for many who work in manufacturing, while their skills underpin the transition, their occupations are not included unless they directly work in that sector. Similarly, those in the aged and community care sectors fill important and growing roles.
"It is worth remembering that without active employers, there are no apprentices and no trainees. We should be doing everything we can to encourage more employers to participate rather than risk seeing a decline in employers who engage apprentices and trainees," Mr Willox said.
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