Apprenticeship reform has been at the heart of the Government’s plan to build back better. Roll out of policy after policy has pushed to increase opportunities within vocational education, from an incentive payment to employers taking on new apprentices to the Lifetime Skills Guarantee. Prime Minister Boris Johnson insisted that “new opportunities are opening up with dizzying speed” at the Lifetime Skills launch last September. Despite a slew of attempts, these apprenticeship policies are still not handing young people the long term security and opportunity they desperately need.
A 2021 report by the Learning and Work Institute found that less young people are starting apprentices programmes. The number of 16 to 18 year olds beginning apprenticeships plummeted by over one third between August 2020 – January 2021. These figures do not represent a declining interest from young people in apprenticeships or a lack of desire to participate in vocational training, rather they indicate a fall in the number of training opportunities open to their age group. In comparison, the number of 25+ people applying to apprenticeships fell by much less, only 7 percent in the same period.
Apprenticeship qualifications are structured in different levels which are equated with academic qualifications to indicate the degree of vocational skill attained. Level 2 (equivalent to a GCSE) is the entry-level qualification, and after achieving this young people can expand their vocational training to level 3 (A Level), level 4 / 5 (degree level) and advance their skill set.
Unskilled workers (particularly those applying to the entry-stage level 2 training) are yet another demographic facing a reduction in training opportunities. The report found that the number of people joining level 2 and 3 apprenticeships fell by 30 percent in all age groups, including the 18 – 24 bracket. As the first two qualifications trainee apprentices can achieve in their training, this decline in opportunities for unskilled workers is tied to the severe reduction in training options young people are facing. Both recent school leavers and unskilled workers need to achieve these early-stage apprenticeship qualifications if they wish to further expand their training and progress in their career.
Whereas, the number of high level 5 and 6 apprenticeships (equivalent to an undergraduate degree in terms of training) opportunities grew by over 10 percent during this same period, despite the recruitment difficulties the first COVID lockdown imposed on all businesses. Employers have started to invest more in high level, degree apprenticeships over the foundational training young employees require, and government policies are failing to restore the balance.
There is value in investing in adult vocational education, but the data shows a concerning, long running fall in the opportunities open to young people to receive core training. “These are long running trends”, Naomi Calyton, the Institute’s Deputy Director of Research and Development, tells Spotlight. Young people are less likely to receive workplace training if they do not have access to early skills and training, and it is an issue with longstanding consequences, as Clayton warns “we might well see the scarring effects of that, in terms of lower future earnings for instance, in years to come.” The reduction in opportunities for young people is an issue which expands beyond the apprenticeship system, and many graduates are also currently facing a stagnant job market and fewer options post-university.
The Institute suggests in their report that the apprentice levy system introduced in 2017 is being used by firms to put staff already on the books into higher level apprenticeships. The policy was originally introduced so that any employer with an annual payroll of over £3 million had 0.5 percent of that secured for investment in apprenticeships, which would pay for high and low level training. However, data now appears to reveal that employers are using levy funds to pay for high level apprenticeships for staff already employed by the company, mostly staff who have already received early level training.
Many are now starting to argue that the original policy needs to be reformed so that the funds do not only go to staff already on the books. Early level 2 and 3 apprentices should still be able to receive levy funding, and by now amending the policy so that it focuses on the imbalance clear in the data will exacerbate the lack of opportunities young people and unskilled workers are facing.
When asked to comment on this use of the levy, Minister for Apprenticeships and Skills Gillian Keegan told Spotlight that “There should be no barriers to anyone considering taking up the opportunity [of apprenticeships].” She confirmed that the government had not included level 7 (MBA equivalent) or level 8 (PhD equivalent) apprenticeships in the levy “as we do not believe this represents good value for money.” However, there was no acknowledgement of how the policy as it stands could be reformed, so that early stage apprenticeships can have secure funding from the levy.
However, more can be done beyond simply ring-fencing the levy so that level 2 and 3 apprenticeships receive secure funding. Clayton argues that solving this clear reduction in young people receiving vocational training requires making reforms to the tax system and tax credits to motivate employers to invest in these core opportunities. The government needs to invest in a wide breadth of apprenticeship opportunities, and more generally consider the ways “we can incentivise employers to invest in workforce development and training, and how we can do that in a way that reduces the inequalities in access to workplace learning.”
Chief Executive Officer of NCFE, David Gallgher, argues investment in SMEs is key in protecting and creating opportunities for young people. “The SME marketplace was always the mainstay of 16 to 18 year old apprentices” Gallagher tells Spotlight. However, policies such as the apprenticeship levy only targets larger firms, and Gallagher is concerned that “we’ve fallen under the illusion that it’s big employers that will help us to solve this problem.” Instead, Gallagher argues that there needs to be a more targeted approach with regards to smaller firms and ensure the apprenticeship system becomes “really easy, really cost effective, with a very obvious return on investment for small and medium enterprises.”
This steady increase in higher grade apprenticeships over lower grades also destabalises the core social mobility function apprenticeships serve, as young and low skilled workers find options for core training and future progression in the workplace more precarious.
The Living and Work Institute report draws particular attention to the Lifetime Skills Guarantee, which provides adults over the age of 23 with a fully funded level 3 apprenticeship qualification in a number of chosen sectors. Improving adult vocational training is welcome, the report recognises, however if the policy “comes at the expense of basic skills and level 2 then it risks limiting opportunity.”
The Social Mobility Commission’s 2021 State of the Nation report highlighted access as an area in which apprenticeships require targeted reform. The Commission affirms that the apprenticeship levy system has been used to provide opportunities for long standing staff, and recommend that this, alongside other mechanisms, must be used “to incentivise employers to provide more Traineeships and Level 2 – 4 apprenticeships, and to move higher level apprenticeships into social mobility coldspots.”
When asked to respond to the Commission’s findings, Minister for Apprenticeships and Skills Gillian Keegan drew attention to the government’s £3000 incentive to employers hiring apprenticeships. “We want to create a strong incentive for employers to create new apprenticeships, regardless of whether they recruit a young person starting a career or an older worker retraining,” she tells Spotlight. However, this policy encompasses all age groups; like many of the government’s policies surrounding apprenticeships it fails to target the discrepancy between starts in 16 – 18 year olds and over 25s.
There must be a clearer definition within policies of what an apprenticeship should achieve, Clayton contends, one which encompasses both skills and access. The value they offer both to employers and employees, through ensuring strong training and productivity, must be coupled with a commitment to “improving social justice and inclusion by reducing the inequalities in access to learning and training”. Through this dual commitment, progression pathways can be expanded for more workers, and policies may be able to tackle the “patterns of disadvantage”, as Clayton describes, which are so clear in the current data.
To read our latest Spotlight report on Skills and Apprenticeships click here.