In Response to Government’s Commitment to Apprenticeship Boost, the Motor Trade Association Urges a Reevaluation of Industry Training Funding.

The Motor Trade Association (MTA) has welcomed the government’s recent announcement to extend the Apprenticeship Boost scheme for key sectors, including the automotive industry, but is calling for a more substantial debate about how industry training is funded, emphasising the need for increased support for employers.

MTA Chief Executive Lee Marshall expressed gratitude for the continued eligibility of the automotive sector for a $500 monthly subsidy, designed to alleviate some of the financial burden associated with hiring apprentices. However, he criticised the amount, arguing that it falls significantly short of addressing the real costs employers face when training new apprentices.

“It’s a welcome measure and every bit helps, but $500 a month is detached from reality,” Mr. Marshall said. He pointed out that employers in sectors like collision repair can incur up to $90,000 in lost productivity and other costs over the three years of an apprentice’s training. He noted that many employers end up absorbing around $70,000 of this cost, all while grappling with financial pressures exacerbated by economic conditions.

“The automotive industry is committed to hiring New Zealanders and believes in the importance of industry training,” stated Mr. Marshall. “Yet, the financial support provided by the government and the burden of costs that employers shoulder are vastly imbalanced. If we can't afford to take on apprentices, we will inevitably turn to the overseas market for qualified technicians — it’s as simple as that.”

Mr. Marshall urged the government and industry stakeholders to shift the focus from merely outlining eligible industries to discussing what a meaningful contribution from the government should look like. He pointed out that without adequate support, employers may disengage from hiring apprentices, impacting the sector’s future and the economy at large.

In addition, the MTA has convened a task force of 20 industry organisations to develop a comprehensive blueprint for industry-led automotive training. This initiative highlights the necessity for greater financial backing from the government, allowing employers to provide quality training and career pathways for apprentices.

“A strong automotive and transport industry is essential for everyone,” Mr. Marshall emphasised. “A shortage of skilled workers doesn’t just affect businesses; it affects consumers through longer wait times for repairs and increased costs due to limited capacity. In extreme cases, it could even force businesses to close their doors due to staff shortages.”

 The MTA calls on the government to recognize the genuine need for increased support and to consider targeted increases in the Apprenticeship Boost to bolster industries that are facing significant challenges. As the nation looks toward sustainable growth, the MTA's push for a more equitable and realistic funding model for apprenticeships underscores the critical role of workforce development in securing a prosperous future for New Zealand.