National Apprenticeship Week 2017 took place this March, and a decade on from its initial inception there is much to reflect on. Universities, businesses, providers, employers and learners will gather together to celebrate and promote apprenticeships, trying to attract the best talent for their benefit.
A range of activities have been scheduled. For example, a Guinness World Record attempt will take place on Tuesday, aiming to create the largest ever online apprenticeship and careers event. But, beyond the fun and PR stunts, we are sure that the Apprenticeship Levy will be a focal point of many discussions, as will the history of where the UK has come from and where it currently stands with regards to apprenticeships today.
1563: The year in which Government first issued laws to regulate apprenticeships in the UK. This was in part to prevent exploitation of young workers while also serving as a foundation for companies to trial new recruits. Rush forward almost 500 years and the modern apprenticeship industry is a far different picture; a patchwork of industries and professions offering over 500 different forms of apprenticeships.
Yet, one could argue that the Government’s goal of improving the training of apprentices through business guidance, and funding is still a little archaic. To this end, the Government has set a target of recruiting 3 million apprentices by the year 2020, supported primarily through the introduction of the Apprenticeship Levy in early 2017.
The Government’s aim for the Levy is for all employers to be able to use the service to pay for training and assessment for apprenticeships by 2020.
Despite its imminent implementation next month, many businesses and potential apprentices are unsure what the Levy actually entails or are even aware of it. A recent poll of senior decision-makers by City & Guilds revealed a third (33 per cent) of UK employers that will be eligible to pay the levy are not aware of its existence. Worryingly, nearly a quarter (23 per cent) of heads of apprenticeships are not aware of the new apprenticeship system.
The reform requires all employers operating in the UK with a pay bill over £3 million each year to pay the Levy at a rate of 0.5 per cent of their payroll. Once declared to HMRC, companies will have access to funding for apprenticeships and training for apprentices through a new Digital Apprenticeship Service Account.
The reform empowers employers to take control of the way they search and train apprentices. It places them at the heart of paying for, and selecting, training while keeping funding on a sustainable footing. Employers will choose a framework or standard, can select from approved apprenticeship provider(s), choose a separate assessment organisation, and then post vacancies – all funded by budget in their new Digital Account.
What’s it mean for employees?
At a time when you can’t move for headlines declaring a widening skills gap, any initiative that promotes and encourages more skill based training is a fantastic opportunity for those entering the workforce. The levy will afford organisations the opportunity to establish or bolster pre-existing training programmes, helping drive up-take amongst young people who will see them as a path to a successful career. This is important. Many workers feel that they were not suited for maximising learning in the classroom environment, but that the workplace provided a much better place in which to blend on-the hands learning with formal career specific training. And, less than a third of job rolesare expected to be graduate positions by 2022. Furthermore, recent research from City and Guilds showed that two-thirds of young people are planning on going to university, despite a third of them not knowing what they are going to study.
These benefits translate into significant monetary returns for individuals over a working life. According to the Government’s apprenticeship paper, Our 2020 Vision, those completing an apprenticeship at level 4 or above could earn £150,000 more on average over their lifetime. Apprentices are also clear that their apprenticeships have increased their productivity and prospects. Eighty-five per cent of apprentices said their ability to do the job had improved, and 83 per cent said their career prospects had improved.
Santander is an example of a business leading the way with regards to apprenticeships. The business announced last week that it is hiring 400 apprentices so that it can tap into a wider spectrum of future talent.
Who can help?
Identifying the right skills and training needs or providers for employees is tricky business. Many employers will already have pre-existing providers or indeed their own provider status, yet the reform sets new standards and expectations. Companies should look to external partners who can bolster their offering by providing guidance, insight and content that addresses their specific needs. Companies should note that they can only spend the funds in your digital account or access government support for apprenticeship training delivered by an approved training provider.
The reform is going to affect every large business regardless of whether it’s from the IT sector, agricultural or manufacturing. For those unsure about how it will affect them, how it will work to their and their (future) employees benefit, or who simply have not got enough experience, they should seek as much education and guidance possible. The Levy offers a great opportunity for employers to not only to deliver more skills to the front line but also to improve the skills of millions of employees in the UK. It's time to start acting now.
For more information see the official Government page here.
Tony Glass, GM & VP Corporate Sales at Skillsoft