The NAO found that apprenticeships typically Improve people’s earnings potential. Based on wage rates between 2004 and 2010, people who had completed a level 2 (intermediate) apprenticeship earned 11% more than similar employees who hadn’t done an apprenticeship. The gap for people with a level 3 (advanced) apprenticeship was even greater – 18%.
These figures confirm earlier research by Steven McIntosh at the University of Sheffield, who looked at wage returns achieved in 2004/05. He, too, found that a level 3 apprenticeship boosted earnings by 18%, while level 2 apprenticeships led to a 16% increase in wages. He also found that completing an apprenticeship significantly increases people’s chances of staying in employment afterwards.
And the benefits don’t end there: the Warwick Institute for Employment Research reported in 2008 that employers get good returns on their investment, provided apprentices stay with them for a few years.
This adds up to a strong track record. There is no doubt that apprenticeships provide a brilliant springboard for many young people at the start of their working lives. Employers are increasingly recognising the benefits, too; and as we have seen in the last couple of years, apprenticeships can also help adults retrain for new careers part way through their working lives.
But public funds have to be used wisely. The NAO picked up a couple of issues which have worried Edge for a while. First, a growing number of existing employees are being re-badged as apprentices – but in some cases they are not getting much extra training and development. And sometimes, public money is paying for training which employers would have provided anyway. To put it bluntly, some public money is paying for quantity, not quality. This is not good value for money. Furthermore, there is a real risk that the reputation of apprenticeships will be damaged in the eyes of the general public.
Secondly, some sectors have seen huge growth in apprenticeship numbers, while others have been static at best. Service sectors have seen the strongest growth, while engineering apprenticeships have barely grown and construction opportunities have actually fallen – particularly for young people. Obviously, the state of the economy plays a part in this, but there’s an argument for adjusting apprenticeship funding to give these sectors extra help in the downturn.
But let’s end on more good news. In the past, too many people failed to complete their apprenticeships. However, official figures show that apprenticeship success rates have risen dramatically since 2006/07, increasing by over 17.4 percentage points to 76.4 per cent in 2010/11.
Provisional figures show that between August and October 2011, more than 46,000 people completed apprenticeships. Of these, 16,100 were aged 16-18, 17,000 were between 19 and 24 and 13,100 were 25 and over. These are fantastic results. I congratulate each and every apprentice on their success – success shared, of course, with their employers, colleges and training providers.
Jan Hodges is chief executive of Edge, the independent education foundation dedicated to raising the status of technical, practical and vocational learning