Five key workforce call outs of interest in the recently released ACCC final report

The Australian Competition and Consumer Commission (ACCC) released its final Childcare Inquiry report, in which it presented eight key recommendations but also a number of notable findings relevant to the ECEC workforce and by extension teachers, educators and employers. 

 

The report marked the third and final release from the ACCC which will likely be an important input to ongoing investigations being conducted by the Productivity Commission into the early childhood education and care (ECEC) sector. 

 

Both reports were commissioned by the Australian Government to identify whether the current system is fit for purpose and what, (if any) measures can be taken to improve outcomes with workforce matters, particularly regarding the ongoing shortage of educators and teachers that featured in both inquiries. 

 

The following five findings from the ACCC’s final report highlight a number of trends which help understand how different segments of the sector are managing the current shortages. 

 

1. For-profit providers of centre based day care tend to hire more graduate teachers

 

Under the Educational Services (Teachers) Award there are five levels of which level 1 represents the least experienced, (ie: recent graduate teachers and newly qualified teachers) whilst level 5 represents the most experienced. 

 

The ACCC observed that level 1 teachers represented just under 50 per cent of teachers employed at for profit providers, compared to around 26 per cent at not for profit providers, and that not for profit providers had substantially more level 2 and 3 teachers in their employ. 

 

2. Centre managers were paid on average 21 per cent above award

 

Centre managers, who fall into level 6 of the Children’s Services Award, were paid on average 21 per cent above the award rate, with the ACCC noting that the high number was due to them being key drivers of quality and also playing a significant part in retaining quality staff.

 

Notably, and consistent with other role types, it was found that not for profit providers paid just over 24 per cent more than the Award and for profit providers around 18 per cent above award. 

 

3. Providers are paying higher wages to educators in remote and very remote Australia

 

Educators in remote and very remote Australia are paid around 20 per cent above award by large centre based day care providers which is likely a function of services offering higher wages to attract educators into these areas where there is a shortage of staff.

 

Interestingly, for services in remote and very remote Australia, unqualified educators covered by Children’s Services Award level 1 and 2 were overrepresented when compared to Major Cities and Regional areas.

 

4. Services with higher quality ratings paid teachers higher wages

 

Providers with a higher quality rating under the National Quality Standard were paying early childhood teachers higher rates above the Educational Services (Teachers) Award, with on average higher rated centres paying around 8 per cent more than lower rated ones. 

 

Providers with ‘Exceeding National Quality Standard’ and ‘Excellent’, on average, pay their teachers 33 per cent above the Award. Conversely, providers that achieve the lower rating of ‘Working Towards National Quality Standard’ pay their teachers 25 per cent above the award.

 

5. Educators covered by an Enterprise Agreement are paid more than those on the award

 

On average, qualified educators at large centre based day cares covered by an enterprise agreement are paid more per hour than educators covered under the relevant Award. 

 

This was consistent across all levels of qualified educator, although the largest difference was at level 3 (Certificate III), where staff under an enterprise agreement were paid more than 6 per cent higher than their counterparts without an enterprise agreement.

 

The ACCC’s analysis of workforce costs and wages trends was part of a broader analysis of the total costs experienced by all types of providers to deliver quality early learning to families across Australia. 

 

A number of notable distinctions was highlighted as to the different cost structures of for profit providers relative to not for profit providers with the former more likely to shoulder higher premises and stakeholder costs, with the latter more inclined to reinvest their savings into higher wages. 

 

Looking ahead, the sector eagerly awaits outcomes from negotiations between the employer and employee representatives, and the Government around increasing modern award wages, a move which would highly likely improve the pay and conditions of all educators substantially.