Navigating the Landscape: Insights from the 2025 Voice of VET Industry Survey
Our latest annual survey shares the perspectives of senior executives of RTOs across all States and Territories of Australia, Including 55 CEOs and Directors, 24 Operations Directors/Managers, 29 Training or Learning Managers, 27 Compliance Managers, and 5 other Senior Managers, representing 140 of the leading Private, Enterprise, Government, TAFE, School and Community VET providers in Australia.
This comprehensive report delves into the current state of the industry, shedding light on key areas such as business and management, digital transformation, learning and training, and the usage of Student Management and Learning Management Systems.
Business & Management: Growth, Challenges, and Future Outlook
The 2024 survey engaged a wide range of RTOs, offering valuable insights into the industry's current state. Despite a rise in average student enrolments, from 875 in 2023 to 1,127 in 2024, more RTOs reported a decline in revenue rather than an increase. Looking ahead, however, a positive shift is expected, with many anticipating revenue growth in 2025.
At present, RTOs are grappling with challenges such as profitability, pressure from revised RTO Standards, and limited Government funding. Compliance and adapting to these new standards remain significant hurdles. On the opportunity front, RTOs are focused on exploring new market and sector growth, with improved marketing strategies seen as a potential solution to drive success.
In line with last year's survey, the National Skills Agreement has only positively impacted around one-fifth of RTOs, indicating that its influence has been limited in driving widespread improvements. As 2025 approaches, the pressure from rising operational costs, profitability concerns, and evolving regulations will likely continue to shape the RTO landscape.
Digital Transformation & AI: Embracing Opportunity Amidst Challenges
Digital transformation is gaining momentum in the VET sector, with RTOs increasingly recognising the value of technological advancements. Two-fifths of RTOs confirm they have a digital transformation strategy, yet only one-fifth have a defined AI plan in place. Despite this, AI is viewed as a major opportunity rather than a threat, particularly in areas like course content, student experience, and course management.
Improving the student experience, boosting employee productivity, and enhancing service delivery are top priorities for most RTOs. While many report satisfaction with their institution’s digital transformation, nearly half acknowledge that funding remains a significant challenge.
On the cybersecurity front, most leaders believe (or hope) that their RTO is adequately protected against cyber-attacks, with solid mitigation strategies in place to counter hacking threats. However, despite these efforts, there remains a clear gap in fully leveraging digital tools to their maximum potential, leaving room for further growth and improvement in the sector.
Learning & Training: Balancing Classroom and Online Delivery Models
The demand for classroom training remains strong, with most RTOs continuing to prioritise face-to-face engagement as a vital component of learning. However, nearly as many have now adopted online training options, reflecting the growing versatility in delivery models. The increase in demand for apprenticeships, traineeships, and non-accredited micro-credential courses shows a shift towards more flexible, industry-relevant training, while nearly all RTOs still offer accredited courses and qualifications.
Industry and employer engagement, along with enhancing staff talent and training, remain the most important factors for improving student training and overall experience. RTOs are aligning their offerings with the education industry's evolving needs to boost enrolments and improve student employment outcomes.
Student completion rates have remained steady at around 80%, and to address this, most RTOs are proactively identifying at-risk students and implementing interventions. Additionally, some have adjusted their training delivery methods to better support students and improve completion rates moving forward.
Student Management System: Consolidation and Continued Value
The Student Management System (SMS) market remains largely dominated by two key players, reflecting ongoing consolidation in the sector. This trend is further underscored by the high spontaneous recall of Learning Management Systems used by SMS providers.
Two-thirds of VET providers report being satisfied with their current SMS, and over half agree that the system provides value for the cost. Compliance reporting, along with admissions and enrolments, continues to be the most critical factors driving the choice of SMS, with these functions highly valued by users.
Key features such as awards/certificates/SOA records management, compliance reporting, and management reporting are seen as the easiest and most efficient attributes of the systems in place. Overall, RTOs remain focused on the seamless integration of SMS to enhance operational efficiency, compliance, and student experience.
Learning Management System: Continued Satisfaction and Stability
The Learning Management System (LMS) landscape remains dominated by six key brands— aXcelerate, Moodle (hosted or self-hosted), Canvas, Catapult, and Ready LMS —which together account for three-fifths of the LMS market used by VET providers. Most providers express satisfaction with their current LMS, with only one in ten reporting dissatisfaction.
Half of the VET providers agree that their LMS delivers value for the cost, while just one in ten disagree with this assessment. Stability in the market is evident, with nearly two-thirds of VET providers planning to continue using their current LMS for the coming year. The overall sentiment reflects a strong preference for the systems in place, with satisfaction levels remaining high across the sector.
As we look ahead to 2025, Voice of VET Report offers a thorough examination of the ongoing challenges and emerging opportunities for vocational education providers in Australia. The sector is adapting to shifting dynamics, with digital transformation and evolving delivery models continuing to play a critical role. This year's report highlights key trends, such as the increasing reliance on both classroom and online training, the growing role of AI and digital tools, and the ongoing pressure from compliance and operational concerns. The insights shared in this report provide valuable guidance for RTOs, helping them navigate these complexities and capitalise on opportunities for growth in the ever-evolving VET sector.
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