Local business owners taking on young people completing a vocation education and training (VET) course will soon be able to do so for free.
From January 2020 until December 2023, the state government will pay the student fee for 70,000 new trainees who start their training under the Smart and Skilled program.
If the employer normally pays the student fee on behalf of the trainee, they will no longer have to pay a cent.
Gunnedah Chamber of Commerce member Michael Broekman said it was great news that the government had "realised that skills shortages can only be resolved by sponsoring the cost."
"It's good to see that vocational education is starting to become important again within our community, people are starting to see that trades are so important to the make-up of our society and we just need to keep the momentum going," Mr Broekman said.
Minister for Education and Early Childhood Learning Sarah Mitchell also welcomed the announcement.
"This ... is an important step in ensuring a skilled workforce to deliver high quality early childhood education and care," Ms Mitchell said.
But Mr Broekman said more was needed to support local businesses and youth in this drought.
"We would still encourage the government to look at sponsoring pre-apprenticeship courses as we believe that is another way of being able to retain the youth in our community and get those potential employees work ready with quality skills," he said.
"It is hugely important as the economics of today means we have to employ people who are productive from day one."