The Self-Sabotage of Skills: Why Defunding Management Apprenticeships will hit productivity

The government’s admirable goal of creating opportunities for one million young people is a crucial step towards tackling a problem that risks leaving a generation on the sidelines of working life. Yet, this ambition is being undermined by the policy choice to defund core management and leadership apprenticeships. We cannot expect a new generation of workers to thrive if we simultaneously dismantle the support structure they rely on – trained, effective line managers.

A serious setback to reviving the UK’s lagging productivity

This decision represents a serious setback to reviving the UK’s lagging productivity. For too long, UK organisations have been staffed by “accidental managers,” with a staggering 82% promoted without formal training. Management and leadership apprenticeships were the proven, practical solution to this structural weakness. They were a pipeline of competence, directly addressing the skills gap employers desperately need to fill if they are to drive growth. The 1,500+ employers who signed a petition against this change aren’t asking for a handout, they are looking to draw from the levy they pay in order to develop the talent they believe is necessary to compete and to grow.

Management apprenticeships added a substantial £120 million to UK GDP in 2023-24 alone.

The numbers make the case for these courses. Management apprenticeships added a substantial £120 million to UK GDP in 2023-24 alone. Furthermore, they are a powerful ladder for social mobility, with 71% of apprentices being first-generation higher education students. This policy cuts the rungs off that ladder, depriving young people of clear pathways into professional careers, including the successful Chartered Manager Degree Apprenticeship. It is worth noting that roughly a third of CMDA candidates are under 25 – last year that was 950 starts for young people, with 330 of those under the age of 19; compared to just 36 starts on the new foundation degree apprenticeships.

Equally disruptive is the impact on our essential public services. The myth that the Levy is solely used for ‘corporate training budgets’ crumbles when nearly half (49%) of these apprenticeships are delivered in the public sector, including the NHS and DWP. How are these departments, which are under immense pressure to find greater efficiencies and drive innovation, now supposed to fund the essential management training needed to deliver value and service for taxpayers’ money?

Apprenticeship Units

We welcome the focus on short courses and the new apprenticeship units on Leadership for AI. But while appropriate for some employers, a specialist unit will not substitute for a foundation in professional management.

In an economic environment where employer investment in skills is already down 19% over the last decade, the government should be stimulating and incentivising skills investment, not creating new barriers.

By Petra Wilton, Director of Policy and External Affairs, Chartered Management Institute (CMI)