16 Sep 2014

Firms defend staff training efforts

1:04 pm on 16 September 2014

Employers and businesses are hitting back at union claims that they have dropped the ball on workplace training.

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Firms invested a record high 7.5 percent more in new plant and equipment in the first three months of the year to lift their productivity.

But Council of Trade Unions economist Bill Rosenberg doubts many firms are putting nearly enough effort into staff training.

"People are well aware that through the 90s apprenticeships almost died because employers stopped taking up their responsibilties to train new workers. And I think we haven't cured ourselves of that feeling yet," he said.

Mr Rosenberg points to studies from Treasury and Department of Labour which show employees are poorly rewarded for undertaking vocational training.

"Until the pay system actually recognises that employees have more skills and potentially more productivity through increased qualifications then saying to people just get trained and your wages problems will be solved is really not being honest with them."

Phil O'Reilly.

Phil O'Reilly. Photo: BUSINESS NZ

Business New Zealand Chief Executive Phil O'Reilly admits some small firms aren't keen on training even if it's logical for them to do so.

"Because what they see is that they invest in the training for that worker, who then goes off to their competitor who might take them on for a bit more money and hasn't invested in that training with all the risks and costs associated with that," he said.

But Mr O'Reilly said firms are telling him that staff training is a priority.

"If employers are prepared to invest in new capital equipment, and that appears to be what the statistics are telling us, then they've got a very clear reason to invest in skills, because they simply won't get capital asset utilisation rates up unless they do that."

Fletcher Building is one of the country's largest employers with 8,000 staff in New Zealand alone. Its head of corporate services Kate Daly said skills and pay are closely tied.

"Right down to our manufacturing plants a lot of those have skill based pay. So as an employee improves their skill base there base rate increases as well."

Competenz is the industry training organisation for the engineering and manufacturing sectors, and has 20,000 trainees.

Chief Executive John Blakey said the system works well up to a point.

He said many firms he works with are putting in the time and effort to lift their staffs' skills, and paying them more to recognise their increased contribution.

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But Mr Blakey said while the government subsidises getting the qualification, it neglects ongoing training.

He said often the full cost of that falls on the employer, which tends to result in workers not getting enough retraining to keep up with the latest developments.

"You might be qualified as a mechanical engineer then you might want to do some work in electricial or you might want to do more work in hydraulics and in doing so you do a significant package of learning, but it wouldn't add up to a qualification."

"But it does add value to the person and to the business. Our system at the moment soimply doesn't encourage people to continue to acquire skills and in a fast changing world that's the way we have to go," he said.