The Great Apprenticeship Push is on.

Business Insight
10/02/2017

Your country needs you - to recruit apprentices. They’re hired.

Any employer who isn’t aware of the drive to boost the nation’s apprenticeship opportunities must have been living in an extraordinary bubble because, quite frankly, it’s a message that’s been hard to ignore.

Apprenticeships, which until recently spent several years in the wilderness, are now viewed as a vital part of the effort to shrink the country’s vital skills gap.

They’re now seen as business productivity winners for employers too, enabling bosses to increase staff but not wage costs.

Other benefits include increased flexibility for existing employees who can be freed up to do what they do best, or take on more responsibility, and a simpler, cheaper recruitment process thanks to the existence of high quality training providers dedicated to customising training programmes and accessing funding, among other things.

The Government is doing its bit, too, and the figures are showing signs of improvement.

Those released last year show that in 2015/16, the numbers of people in apprenticeships was up 871,000 from the previous year and there were 509,400 apprenticeship starts in England, 9,500 more than the previous year.

Of the latter, more than half were women and over 25s accounted for 44%, 19-24 year-olds accounted for 30% and under 19s 26%.

Most were concentrated in the three main sectors of Business, Administration & Law, Health, Public Services and Care and Retail and Commercial Enterprise. Clearly more work needs to be done if the nation is committed to doing something about the on-going engineering and construction skills black holes.

One of the biggest initiatives in recent times is the introduction of a levy (a 0.5% tax on an employer’s pay bill above £3 million pa), due to come into force in April and aimed at helping the Government meet its stated aim of training three million new apprentices by 2020. The measure is also introducing more generous subsidies for employers training apprentices in England.

It was estimated that the new tax will raise £2.8 billion in 2019–20, but in recent weeks a row broke out after Institute of Fiscal Studies (IFS) labeled it ‘poor value for money’.

After its researchers analysed the proposals, the think tank said government spending on apprenticeships in England was only expected to increase by £640 million between 2016–17 and 2019–20, so most of the revenue raised was being spent elsewhere.

Furthermore, the IFS claimed specific elements of the system could end up being particularly damaging to the public sector.

It called for the removal of government targets ensuring 2.3% of every public sector employer with at least 250 workers started an apprenticeship each year, saying they were “not an efficient way of working” and accused the government of failing to make a convincing case for such a large and rapid expansion in apprenticeships.

The report’s author, Neil Amin-Smith, said: “We desperately need an effective system for supporting training of young people in the UK. But the new levy and associated targets risk repeating the mistakes of recent decades by encouraging employers and training providers to relabel current activity and seek subsidy rather than the best training. There is a risk that the focus on targets will distort policy and lead to the inefficient use of public money.”

The Department of Education insisted that the reforms were excellent value for money, that quality was at the heart of all its apprenticeship reforms and that it had taken steps to protect the term apprenticeship from misuse.

In the meantime, one of the most high-profile recruitment drives is due to get under way in March - National Apprenticeship Week.

Now in its 10th year and running from March 6-10, it celebrates apprenticeships’ positive impact upon individuals, businesses and the economy. Hundreds of events and activities are lined up across England to showcase apprentices, employers and a decade’s-worth of success.

Sue Husband, director of the National Apprenticeship Service, which co-ordinates the event, says: “National Apprenticeship Week is an important date in the calendar as it brings to the forefront of everyone’s minds the importance of helping to get more people to consider becoming an apprentice, and celebrates the success apprenticeships bring to business.

“2017 will be no different to past events as it will raise awareness that the time is right for potential apprentices to get the skills they need for a great job, and highlight how businesses can grow their own talent whilst developing the motivated, skilled and qualified workforce they need, no matter what size.”