- Following the recent Policy Exchange report ‘Reforming the Apprenticeship Levy’ early career expert examines the current landscape for candidates across the UK
- Calling for better communication and education for employers and businesses, experts believe apprentice talent is not being utilised effectively
- Humanity-based industries are not leveraging the levy enough, whilst small businesses are left unsupported in doing so
Led by the former adviser to three Education Ministers, Iain Mansfield, the think tank ‘Policy Exchange’ released a detailed report on ‘Reforming the Apprenticeship Levy’ this week.
The report, which is endorsed by the former Secretary of States for Education, CEOs, MPs and educational institutions across the country, outlines how the apprenticeship levy is failing to deliver the volume of high-quality apprenticeships needed to unlock opportunities for young people and to strengthen Britain’s productivity.
Delving further into the current state of apprenticeships across the nation, co-founder of the job & review platform, RateMyApprenticeship.co.uk, Oliver Sidwell, highlights the industries that he believes are not leveraging the apprenticeship levy effectively and that are missing out on key talent because of this.
How The Apprenticeship Levy Currently Works
“While only the biggest businesses pay the levy, the funding generated by it also funds apprenticeship training for other employers who want to take on apprentices. Smaller employers – those with a total annual pay bill of less than £3 million – pay just 5% of the cost of their apprenticeship training and the Government pays the rest.
“The funds can be used for degree apprenticeships or GCSE-equivalent apprenticeships, the levy creates flexibility and choice in how employers provide apprenticeships. Where businesses do not use all of their funds, they can pledge these to smaller businesses for their apprenticeship programmes.”
The Apprenticeship Levy Is Not Being Utilised Effectively
The Policy Exchange report reveals, “The total number of apprenticeship starts has diminished from a high point of over 500,000 in 2015-16 to 349,190 in 2021-22 – and remains significantly below the pre-pandemic starts of 393,000 recorded in 2018-19.”
With this in mind, Oliver reflects on the difference the levy has made to these numbers, “Since 2010, over 5.3 million apprentices have started their apprenticeship journey in a wide range of industries, from business to health and engineering. The apprenticeship levy which was created so businesses can take on more apprentices, alongside the opportunity to invest in high-quality training to develop the skilled workforce they need, has added to this, but only certain industries have taken advantage of this.”
Some Industries Are Missing Out on Apprenticeship Talent
“The latest Government data for April 2023 shows the stark differences in industries leveraging the apprenticeship levy to those not. Apprenticeship starts were highest in Business, Administration and Law as well as Health, Public Services and Care with significantly lower numbers in the more humanity-based industries such as Arts, Media and Publishing and History, Philosophy and Theology.
“RateMyApprenticeship’s latest study, which analysed internal apprenticeship job listing data from 2017 to March 2023, highlighted the digitisation of the workforce as data analysis skills were the most in-demand featuring in 1 in every 9 (11%) job postings on RateMyApprenticeship between January and March 2023. The results, in line with the nationwide industry view, show that apprenticeships are commonly being used within the business admin industry and not enough across a wide range of industries.
“There are, however, some industries getting it right when it comes to apprenticeships. The RateMyApprenticeship index for Best Apprenticeship Employers in the UK includes a range of employers across all industries who are already hiring apprentices across the country. The company just wishes more would adopt the same approach.”
How Can The State of Apprenticeships Be Improved in Britain?
With this in mind, Oliver has shared his thoughts on what can be done to improve apprenticeships in the UK, “In line with the call for reform, there are changes I believe need to be made to ensure Britain is capitalising on all the talent it has available across all industries.”
Wider Apprenticeship Education for Employers & Businesses
“Regardless of background, young people should be able to find an apprenticeship that suits their intersecting interests and skills whilst offering a career path. At RateMyApprenticeship, work has been done to educate and advertise to potential apprentices what’s available to them and, with this and improved access to career advice in educational institutions, there still needs to be more education for business owners and employers on what is available to them when it comes to hiring apprentices.”
Further Small Business Apprenticeship Support
“Currently, the levy is more flexible for bigger businesses and less support is in place for small businesses to hire apprentices, in turn supporting young people in employment and independent businesses for a more circular economy. While the funding is available, again, more education and support need to be provided to SMEs to help them hire apprentices and create their programs.”
Championing All Talent Types for Apprenticeships
“Finally, in the last decade, the UK has seen a significant increase in the types of apprenticeship programmes – there just needs to be more. Recently new green apprenticeships and Doctor’s Degree apprenticeships have helped open fields up to a range of talent. Going forward, businesses across the UK need to offer an entrance for other new candidates to access their industry and roles to harness the most out of what our young people have to offer.
Further to this, Oliver adds, “The apprenticeship offering in the UK is vastly improving and the levy has been a huge catalyst for this. However, there are obviously still key industries where apprenticeships are harder to get and this could come down to a lack of education for employers in understanding what the levy is and how to use it but also in the restrictions of the levy that do not allow the funds to be used for ‘top up’ degrees or other skill-building courses that can help further enhance apprentice talent.”