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Productivity Commission 2017 Report highlights challenges in University education outcomes

The Productivity Commission, the Australian Government's principal review and advisory body on microeconomic policy and regulation, has released a major report which highlights challenges in the way Australian universities prepare graduates for employment.

The Report “Shifting the Dial” ( was tabled in Parliament on October 24, and is the first in a series of 5-year Productivity Reviews.It departs from previous practise in that for the first time it directly addresses social factors; notably inequality: “A key issue will be to ensure that future economic, social and environmental policies sustain inclusive growth ... Productivity growth provides a capacity for higher incomes and poverty alleviation. The motivation for limiting inequality extends beyond its intrinsic value to the desirability of avoiding too great a dispersion in incomes, given evidence that this can, in its own right, adversely affect productivity growth. Public support is also more likely for reforms that offer benefits to the bulk of people.”

The Report examined in detail three areas where “…reform is longer term and more fundamental. We chose health care, education and cities…”.Higher Education is addressed in a section entitled “Future Skills and Work”, which draws from the Commission’s analysis of University Education (

The Report identified a series of problems with the current education and training system, with specific university challenges, including:

  • Declining student employment outcomes;
  • Academic careers more focused on research than on teaching; and
  • Subsidization of research by teaching.

The Commission outlined a series of recommendations, including:

  • Means to improve student decision-making prior to entering university;
  • Encouraging universities to focus on high-quality teaching to enhance human capital development; and
  • Increased emphasis in degrees on skills relevance and job matching

The Commission and the Government are seeking feedback on the Report, which will influence policy considerations for this and subsequent Governments.The Productivity Commission Report is a key input to BHERT’s developing thinking about Work Integrated Learning and university-industry collaboration on sectoral outcomes in graduate employability.


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