Kirstie Donnelly MBE, Managing Director of City & Guilds

Concerning lack of knowledge uncovered less than two months until introduction of levy

A third (33%) of UK employers who will be eligible to pay the new apprenticeship levy from this April are not aware of its existence according to a survey from leader in skills development, City & Guilds.

City & Guilds polled 500 senior decision makers from a range of organisations to ask them about their skills and recruitment needs and gauge their opinions about the impending changes to the apprenticeship system and likely impact upon their organisations.

The findings demonstrated that a vast majority of employers (87%) currently struggle to recruit the staff they need. Almost a third of respondents stated that they find it hard to fill apprenticeship places (29%) and this is before competition for talented candidates intensifies following the introduction of the levy. In addition, 59% of respondents said they intend to recruit apprentices in the coming year – significantly more than the 44% who intend to recruit graduates.

The research demonstrated the need for employers to think more laterally about recruitment; despite the desire for non-graduate employees, universities were noted as the most used routes for recruitment (46%) compared with only 9% who said that they recruited from schools and 22% from colleges.

The findings also uncovered a lack of understanding about the way the levy could be used to train existing staff and the wide range of jobs that apprenticeships could potentially be used to fill.

For example just 18% realised that apprenticeships could be used for caring, leisure and other services jobs despite this being a sector where apprentices would be particularly well placed to fill jobs.

Only 19% stated that they believed apprenticeships could be used to train managers and leaders, regardless of the fact that this was noted as the most difficult type of job to fill. This suggests many didn’t realise that they could use their levy to train current staff with management potential.

Other findings from the report included:

  • Over two fifths (42%) of respondents stated that they expect leaving the European Union to have a positive impact on their businesses ability to recruit. This is despite the fact on average 30% of their staff come from the EU and 18% of respondents relied on EU staff to make up over half of their workforce.
  • Despite the fact that the new employer-led apprenticeship system will be launching in less than two months, only a third (33%) said they felt fully informed about the changes.
  • Almost a quarter (23%) of Heads of Apprenticeships were not aware of the new apprenticeship system and 28% of all those surveyed were not sure whether it would affect their business
  • Of those employers who have problems recruiting people to fulfil the needs of their business, apprentice jobs are harder to fill than graduate training roles, with 29% struggling to fill apprentice roles and 22% struggling to fill graduate training roles.
  • Only 31% of employers said they will be employing a larger number of apprentices because of the levy, despite this being part of the Government’s campaign to ensure 3m apprenticeship starts
  • A number of employers will be cutting their entire current training budget to pay the apprenticeship levy, with 15% of respondents cutting other recruitment schemes to pay for it. 

Apprenticeships are a huge area of untapped potential

As our research highlights apprenticeships are currently a huge area of untapped potential - if their benefits could be fully realised by employers, they would help fill many of the skills gaps that businesses across the country are facing.

If freedom of movement is restricted post Brexit, skills self-sufficiency will become increasingly important for the UK so it’s the perfect time for employers to embrace the new apprenticeship system which now benefits from unequivocal Government support.

The lack of awareness about the new apprenticeship system among our respondents is a cause for concern and shows that we still have a hill to climb in convincing people about the benefits apprentices can bring to business.

However, those that do know about the levy are saying it is a great way for employers to pay for training, so there is clearly understanding and appreciation of apprenticeships out there. With just two months to go until the levy begins, it’s vital that everyone in the skills sector and Government gets out there and communicates with these less enlightened businesses to help them see the huge potential benefits apprenticeships can bring.

Despite the lack of knowledge amongst employers many of the findings were extremely encouraging. 31% of the business leaders said that they intend to increase the number of apprentices that they recruit thanks to the levy and opinions towards the levy were overwhelmingly positive.

47% felt that the levy was a great way to get employers to pay for training, 43% felt that it gave employers more control over the system and 34% felt that it would increase quality.

A majority of respondents stated that they intend to manage part or all of their apprenticeship programme in house (72%). Whilst this is a good option for many organisations and should be supported and encouraged, employers must be fully aware of the implications this would place upon them such as the need to be inspected by OFSTED.

It’s really encouraging that our research has revealed a positive attitude towards the new system amongst employers. To capitalise on this good feeling we’d like to see more action from Government over the coming year; this should include activity to encourage greater parity of esteem between academic and professional and technical education including better impartial careers advice, as well as a follow through on the promise to create a new UCAS-style system for apprenticeships to ensure that there are enough young people opting to fill the apprenticeship roles as they become available.

We’d also encourage employers to consider building relationships with local schools and colleges so they can inspire young people to consider careers in their organisations in the future and show them the different pathways through to a great job.

Kirstie Donnelly MBE, Managing Director of City & Guilds

Click here to read DfE's response to this survey.

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