What the new tertiary fees will mean
The federal goverment’s tertiary fee shake-up may be good news for some and spell disappointment for others
Future nurses and teachers will benefit from the federal government’s university fee restructure, but with fees for humanities, law and economics degrees set to rise, some students may be forced to rethink their options.
New students in 2021 can expect to pay about 28% more for a law degree, and the cost of a humanities degree is likely to more than double from about $20,000 to $43,500. Those looking to enrol in nursing and teaching will benefit from a fee drop of about 45%, and in science 23%. Current students, on the other hand, will not see an increase in their fees but will get the benefit of any reductions.
Weighing up the costs
Lauren Heaydon, careers coach and founder of career counselling website Mentor You, says the government’s fee change announcement has driven career decisions for some of the people she mentors.
“I had a student receive an early offer for an arts degree at the University of Notre Dame but her father talked her into a teaching degree instead,” says Heaydon. The difference was an arts degree costing $14,000 a year versus a degree in primary education costing $3500, but Heaydon says arts and communications degrees are good if you’re unsure what you want to do.
“Taking a communications track would have been a good area for her, and at the end of the third year she could do a masters in teaching for a fourth and fifth year, if she wanted,” says Heaydon. “But when the new figures came out the family thought it was too expensive to add a master’s degree costing $50,000 all up instead of a teaching degree on its own.”
Most students are not too concerned about the cost, but it is hard for parents to have their kids amass large HECS-HELP debt, especially if they are unsure what they want to do.
Investing in education
Education is no longer seen as a once-in-alifetime expense. Research now suggests that a teenager today will have 17 jobs and five careers in their lifetime, and someone in their 20s will have four careers and 17 employers, changing roles every two years.
Education is a long-term investment, not a cost, and needs to be considered in that light, says independent career coach Heidi Winney.
“Ongoing learning throughout your lifespan is the norm now, particularly as we are living in such a VUCA [volatility, uncertainty, complexity and ambiguity] world.”
Winney says it’s always important to seek advice from a career development professional unless potential students have clarity around what they ultimately want to do.
“School advisers may not always be the right people unless they have industry experience and have worked in corporate environments. Some courses are more expensive now so it’s even more important to gain clarity about direction and choose wisely.
“New graduates often find it difficult to get work unless, for example, they are a top student who is more likely to be hired by the top firms.”
Mentor You also has experience helping students and parents choose between TAFE and university. Heaydon says she had a student who was suited to a construction-type career.
“We recommended a trade first and then uni as kids who come through on the tools are often better workers than those who are uni trained because they understand the trade first. It doesn’t mean kids shouldn’t go to uni, but they should go later in life to become more qualified,” she says. But the parents felt that because they had invested in a scholarship account for the child, he needed to go to university, she says.
Where TAFE can pay for itself
TAFE, which involves practical work on the job as well as studying, can provide relief for parents and students. The Master Builders Association offers a pathway into university through doing a trade. There are two options.
One is the apprentice to site supervisor program, where existing apprentices can begin the diploma of project management while concurrently completing their apprenticeship. The other is a trainee master construction recruitment program, which begins with on-the-job training in certificate II in construction, gaining hands-on exposure to all elements of site work including carpentry, concreting,
height safety, formwork, plastering, painting and leading to a diploma in project management and a bachelor of construction management (with a 12-month credit to the degree).
A student mentored by Heaydon took this route and is now at TAFE one day a week while working the other four. In his fourth year he will work full time before he has the opportunity to complete the construction management degree on a part-time basis.
Parents love that idea, says Heaydon, especially when students are unsure what they’re going to do after year 12. There are also traineeships available for students in areas such as business administration, finance, banking and real estate. “People working in valued jobs now include supermarkets, liquor shops, petrol stations and tradespeople. And some jobs that were highly regarded are now quite volatile. With planes down, for instance, engineers are unemployed and many may need to retrain in another profession.”
There has also been the argument that certain tradespeople will be able to earn more money than those with degrees – for example, a machine operator in excavation can make $200,000 a year while an engineer out of university for 10 years will likely earn a maximum of $150,000.
Finding perspective
Year 12 student Isaac Grove says he plans to go to university next year but is undecided about what to study. “I guess the government is trying to push people into certain paths and that works for me in a way. Being undecided, I’ll probably pick something that’s not triple the price of another degree. I’d still want to be vaguely interested in it though. “I’ve thought about teaching – the reduced cost would make a difference, but if I was really set on a course, the cost wouldn’t sway me. But because I’m undecided, the cost makes a difference.”
Grove says he’s a “little bit conscious” about HECS-HELP debt and how long it would take to pay off.
Of his schoolmates, Grove says a few people know what they want to do and they’re set on that, and the cost of the degrees won’t change their minds.
Skills in demand
In 2019, the federal government identified the occupations most likely to be in demand now and in the future.
These included health care and social assistance; professional, scientific and technical services; education and training and construction; aged and disabled carers; registered nurses; child carers; welfare support workers; software and applications programmers; management and organisational analysts; accountants; primary school teachers; secondary school teachers; and education aides.
It also identified 10 trades where there is a skills shortage and will provide $1000 to apprentices at the end of first year and $1000 at the end of the apprenticeship. Employers will be paid $2000 at the end of the first year and $2000 at the end of the apprenticeship.
Skills shortages were identified in the following 10 areas: carpenters and joiners, plumbers, hairdressers, air-conditioning and refrigeration mechanics, bricklayers and stonemasons, plasterers, bakers and pastry cooks, vehicle painters, wall and floor tilers and arborists.
More information is available through australianapprenticeships.gov.au.
Start saving early
Evalesco director and financial adviser Marshall Brentnall says when it comes to school and university fees there is less friction when people start putting money aside early.
“There are several ways that we see Australians funding education – the main ones are investment bonds, education bonds and personal wealth accounts,” says Brentnall.
“The advantage of investment bonds [previously known as insurance bonds] is that they are simple, taxation is capped at 30% annually and after 10 years the proceeds are entirely capital gains tax free.
“Scholarship or education bonds are an effective way to put money aside. However, there can be significant penalties should you use the monies for a purpose other than education.
“By far the most common method is where parents regularly invest a set amount of money into a wealth account that invests in a diversified portfolio of shares, which they continue to add to each month. An advantage of this strategy is that it is flexible, and the monies can be used for any purpose whatsoever, rather than just education.”