The importance of the market for ATCO training

The importance of the market for ATCO training Purpose Air traffic management (ATM) relies on decisions made by air traffic control officers (ATCOs) to ensure the effective and efficient operation of the system. These ATCOs have specialist skills and undergo intensive training in order to provide various ATM services. Traditionally, this training was provided in-house by Air Navigation Service Providers (ANSPs). Increasingly, some areas of training have been unbundled from the ANSP s operations and outsourced to external providers, such as specialist training organisations. Unbundling allows ANSPs to access lower-cost training, often at a higher quality than they themselves can provide. Many ANSPs still choose to fully train ATCOs in-house. For larger ANSPs, this can be just as cost-effective as outsourcing the training. But in some cases, ANSPs are retaining their in-house training unit even though it may not be cost-effective or beneficial for them to do so. This is for several reasons including difficulties in obtaining certification for ATCOs that have been trained overseas, a lack of standardisation for ATCO recruitment and training, and cultural resistance to outsourcing training. The purpose of this paper is to highlight the benefits of outsourcing aspects of ATCO training to external providers, particularly for smaller ANSPs. This paper also discusses why some ANSPs are currently unable to access the market for ATCO training services, and suggest potential ways to address these issues. A market for ATCO training is already developing In the past, ATCOs were trained exclusively by the ANSP using in-house training units. This was, in part, because there were no prescribed standards for training ATCOs. There were therefore limited opportunities for any potential external training provider to offer their services. Furthermore, ANSPs were largely owned by the State and/or military authorities. Many ATCOs were viewed as civil servants and there was an expectation that training should be provided internally. Increasingly, a market is developing to provide training to ATCOs. One recent survey by CANSO finds that of the 20 ANSPs surveyed, nine source their training externally. i External training is often provided by dedicated training companies. Many ANSPs have also established their own commercial businesses to train external ATCOs. Some tertiary education institutions have also joined forces with the ATM industry to offer courses to potential ATCOs. There is potential to use an external supplier at different stages of an ATCO s training. As the box on page 2 explains, it is generally the earlier stages of an ATCO s training candidate selection and initial training that are outsourced as these are more easily standardised than later stages. The next stage of training - unit training - usually takes place in-house. This training is specific to the site where the ATCO is employed and there is less scope for an external supplier to provide the training. There is, however, some opportunities for external trainers to provide continuation training. 1/8

The different stages of an ATCO s training ATM training has four distinct stages. Each of these stages has differing deliverables and requires different expertise. 1. Candidate selection The candidate selection process is an early filter aimed at selecting candidates with a good cultural fit, personality characteristics and the required intellectual aptitudes. Standardised testing can be used to select for student aptitude. For example, the First European Air traffic controller Selection Test (FEAST) is a set of standardised tests for skills, cognitive ability, English and ability to multi-task currently used by 48 different organisations worldwide. ii 2. Initial training Initial training includes foundational theory and develops a basic general skill-set that conforms to regulatory requirements. The training typically lasts between eight to thirteen weeks. Graduates of initial training are awarded a Student ATCO Licence, which enables them to progress to unit training. Obtain student license 3. Unit training Obtain ATC licence and site validation Unit training is delivered in an operational work situation, often onthe-job in live situations. Students use simulators to learn site-specific skills and information. Following the successful completion of the unit training process, the ATCO can obtain their ATCO license and site validation which enables them to operate as a controller at a specific site and in a specific role (for example, tower, approach or area control). 4. Continuation training Continuation training prepares ATCOs for new technologies and provides them with the necessary skills to perform new roles, and improves their overall skills. Continuation training consists of refresher, conversion and emergency/contingency training. 2/8

ANSPs and their customers can benefit from accessing the market for ATCO training The training process for controllers is lengthy and costly. Training typically takes around two to three years, and one source reports a minimum cost of 100,000 per student. iii It also has a relatively high failure rate. According to a recent CANSO survey of 20 ANSPs, the median failure rate was 13%. One ANSP reported a failure rate of 50%. iv Unbundling training services from ANSPs and creating a competitive market of independent training service providers can significantly reduce the cost of training. This benefits not only ANSPs but ultimately, through the ATM charges, their airport and airline customers. Many ANSPs are small, and require training for only a small number of controllers per year. v The cyclical downturns the aviation industry is exposed to can also lead to temporary halts in recruitment. Any in-house training unit is still, however, expected to develop training and assessment processes, provide instructors, and to respond to changes in training regulations and ATM procedures. Specialist training organisations can exploit the economies of scale available when training large numbers of ATCOs. By delivering services across multiple ANSPs, external providers are able to spread these costs and utilise their resources more effectively, thereby reducing the cost of training per student. One study estimated that outsourcing training could save a medium-sized ANSP 14% of the 7 million it would spend per year on ATCO training. vi When multiplied across the industry, the resulting savings could be significant. Specialisation by training providers can also improve the quality and effectiveness of training. This includes the development of enhanced training and assessment methods that increase the pass rate and therefore result in further cost savings for ANSPs. The large variation in reported failure rates across ANSPs suggests some could benefit significantly from being able to access enhanced training methods. External training providers can also be better placed than ANSPs to incorporate technological advances in ATM. Individual ANSPs with limited resources may otherwise struggle to respond to new technologies and processes. The economies of scale available to external providers may also make new training technologies viable that would not otherwise be justified. The use of tertiary education institutions to train can also improve the skills of trained ATCOs. The ability to combine ATCO training with, for example, courses in aviation management would deliver ATCOs with a broader skill-set, of value to an ANSP. Partnership with a tertiary education institution Case study The ANSPs FerroNATS and Airways New Zealand have in the past, partnered with the Inter American University of Puerto Rico to train controllers. FerroNATS supplied instructors and examiners for a course run by Airways New Zealand at the University. Students who successfully complete the course and the FerroNATS selection process could then enter FerroNATS pool of controllers. 3/8

These benefits are reinforced through the competition created between multiple training organisations for the contract to train an ANSP s ATCOs. Competition creates incentives for training organisations to identify efficiency savings that would be passed onto customers, and to provide a level of service that their customers demand. The outcome of this can be a reduction in the cost to ANSPs of outsourcing their training and the delivery of more reliably successful students. The creation of a training market for ATCOs can also benefit ANSPs by reducing the risk of staff shortages. In the cases where an ANSP faces unusual traffic growth or unexpected high staff turnover, larger external training suppliers may be able to accommodate the change in demand more easily than a smaller in-house training department. The development of an ATCO training industry may enable ANSPs to reduce their exposure to the high training failure rate by allowing self-funded training. Generally, it is the ANSPs themselves that bear the cost of training ATCOs. However, a move to greater self-funding would remove the cost and risks of early failures from the ANSPs. ANSPs can instead take on students at a more advanced stage of training in which success is more assured. Self-funded training is the norm with many other career starts, including pilot training and some ATCO students are already self-funding their training. A number of tertiary education institutions offer courses in ATM and several training providers also offer courses to self-funded students. Self-funded ATCO training Case study Airways New Zealand provides initial training for Vietnam Air Traffic Management (VATM). Airways and VATM select the students, who then travel to New Zealand to complete their training programme. The students and their families self-fund the training with VATM guaranteeing an on-the-job-training position and employment on successful completion of the programme. This programme has achieved pass rates in excess of 95% with students very motivated to succeed given the investment by their families. An additional benefit of the development of a market for ATCO training is that it could reduce barriers to entry for potential new entrant ANSPs as part of the liberalisation of the ATM industry more generally. Potential ANSPs may lack the scale to provide costeffective training ATCOs. The ability to outsource training could allow them to reduce the cost of training so that they can compete with incumbent operators, for example, for terminal air navigation services (TANS). 4/8

Many ANSPs continue to train ATCOs in-house In many cases there are economic and technical reasons for ANSP to train ATCOs in-house. In cases where the ANSP is sufficiently large, this can be a cost-effective option as they can exploit the economies of scale in-house. The later stages of training unit and continuation are also more difficult to unbundle because these can be sitespecific. They often require live data or specific setups that are only available to an individual ANSP. However, in many cases regulations and rules mean that some ANSPs are not able to access the ATCO training market, even if it would be beneficial for them to do so. In addition to keeping the cost of training their ATCOs artificially high, this can affect the quality of the training provided. A lack of standardisation can prevent some ANSPs from accessing the ATCO training market. Different ANSPs have different selection criteria. For example, some ANSPs have particular rules around the age of students and the instructors that are providing the training. Other ANSPs have specific criteria and requirements for student ATCOs over and above the industry standard. This means that an external training provider may not be able to provide training to a particular ANSP despite already meeting the requirements of other ANSPs. Regulators are often unwilling to recognise an ATCO s qualifications if these have been certified in another State. Although the descriptive, rather than prescriptive, nature of the requirements enable local flexibility, the resulting room for interpretation can lead regulators to be uncertain about the basis for the certification awarded by a regulator in another State. This can restrict the ability of a training provider who has been certified in one jurisdiction from providing training in another unless it receives certification in each State it operates in. However, the certification process can be expensive for both the training provider and the regulator, and may deter training providers from offering their services in a particular State. Case study Entry Point North international certification Entry Point North is a training academy, initially established in Sweden. In 2014, Entry Point North expanded to Ireland. Although Entry Point North was certified to EASA standards by the Swedish Transport Agency, the Irish Aviation Authority required Entry Point North s Ireland operation to be re-validated to the same EASA standards. Anecdotal evidence also suggests that in some ANSPs there is inherent resistance to the notion of outsourcing training and to accepting student ATCOs who have completed initial training elsewhere. Cultural differences across ANSPs may mean that internal trainers are opposed to the processes and standards used by external providers. Opposition can be particularly strong when the move to outsourcing training could result in redundancies, or to the feeling that internal skills are being lost or undermined. 5/8

Continuing efforts are required to ensure access to the training market There is a market for training ATCOs and some unbundling has occurred. However it is also clear that many ANSPs that could benefit from accessing this market are not able to do so. Continuing with internally supplied training services exposes many ANSPs to avoidable risks and costs. This includes the cost of developing and maintaining training materials, and a limited ability to improve training effectiveness due to limited scale. For ANSPs facing growing traffic and a corresponding need for staffing increases, or where there is a need for course development for example to respond to new training requirements these costs and risks are amplified. There is a need for regulators to recognise and accept training providers that have been certified already by a regulator in another State or at the ICAO level. This type of mutually recognised certification already exists for pilots and aircraft. The development, and acceptance, of regional or global training standards would assist this process by providing regulators with a recognised basis for accepting certifications issued by another State. More generally, the development of global standards for recruiting and training controllers would help further standardise the training process. These would need to address differing standards about the need to speak the local language, age limitations and educational requirements. Once developed, any divergence from these common standards by an individual ANSPs should be challenged to determine the reasons for it and whether it justifies an ANSP-specific requirement. An effective market for training services requires training services to be offered at fair prices. A number of ANSPs provide training to external students, including to ATCOs employed by other ANSPs and to self-funded students. Currently, it is possible for ANSPs to price their training services below the cost of providing the service through cross-subsidisation. This prevents independent training providers from being able to compete on price, and creates an unsustainable market for training. Although we are not currently aware of any specific instances where this has occurred, greater transparency around ANSPs costs and the requirement for ANSPs to establish any training companies at arms-length is needed to mitigate the risk of this occurring. Case study Development of mutually recognised certification in Europe The European Aviation Safety Agency (EASA) has formalised technical requirements for ATCO training and rules for the mutual recognition of ATCO licences and training organisation certification. In principle the rules enable training organisations certified by an ANSP within the ambit of EASA to have their certification recognised by any member State. vii In 2017, Entry Point North expanded its operations again, this time into Spain. As a result of EASA s new rules, the Spanish regulator enabled Entry Point North to operate in Spain on the basis of its Swedish certification. 6/8

What happens next? The development of the ATCO training market is tied up with the liberalisation of the ATM industry more widely. Greater competition between ANSPs, such as for TANS, may lead to natural growth in the ATCO training industry as more ANSPs may chose to outsource their training in order to make cost savings that improve their competitiveness. However, the liberalisation of the ATM industry is itself, in part, dependent on the ability of ANSPs to access the market for ATCO training services. Potential entrant ANSPs may be unable to enter the market unless they are able to recruit and train ATCOs for the same, or lower, cost than incumbents. For entrants that lack the scale of the incumbent ANSPs, this would likely require them to use external training providers. There are not currently any obvious indicators that intervention is needed to develop the ATCO training industry. However, given the potential impact of the ATCO training industry on the wider liberalisation of the ATM industry, the ATM does intend to monitor the issues highlighted above that limit the ability of some ANSPs to access the ATCO training market. 7/8

List of endnotes The ATM i CANSO, CANSO ATCO Remuneration and HR Metrics Report 2017, p.35 ii see http://feast-info.eurocontrol.int for more information. iii Eurocontrol, First European ATCO Selection Test used outside Europe for the first time, 17 May 2016. iv CANSO, CANSO ATCO Remuneration and HR Metrics Report 2017, p.35 v According to CANSO s ATCO Remuneration and HR Metrics Report 2017, of the 20 ANSPs surveyed, the median number of ATCOs employed was 189. Average staff turnover was 3.7%, indicating that some ANSPs may be training seven or less new ATCOs each year. vi Andrew Charlton, Opening up the training market featured in Airspace, Issue 24, Quarter 1 2014 vii European Aviation Safety Agency, Notice of Proposed Amendment NPA 2012-18(C) Licencing and medical certification of air traffic controllers, Section 9 Approach to Initial Training Transposition of the Common Core Content 8/8