The Times published an article today, “Big fall in apprentices blamed on red tape and higher costs” which at first glance was really bad news. The article suggested that in the last three months, August to October, that apprenticeship starts had fallen from 117,800 to 48,000.
Lord Blunkett, the former education secretary, described the drop as “catastrophic” while an employers’ group said the figures were “shocking”.
The article suggested that the fault of this decline in apprenticeship starts lay firmly at the door of the Apprenticeship Levy. Sir Vince Cable suggested that it was the fault of Brexit.
Sir Vince Cable, leader of the Liberal Democrats, said: “The government said that the levy would increase productivity growth, but long-term productivity is in decline. This news underlines both a lack of business confidence and the failure of the government to prepare for a post-Brexit future. Sadly, young people are paying the price.”
Incorrect Apprenticeship Data
We were alarmed by this report as our experience on the ground was that employers were genuinely looking for ways to engage with the Apprenticeship Levy and August to October is also the prime apprenticeship recruitment period for businesses looking for school and college leavers. We took a look at the underlying data and discovered that the article was a little off with the quoted statistics. The period actually being described was May to July 2017. During this period, there were 48,000 starts compared to the 117,800 for the same period in 2016.
Why the drop in Apprenticeship Starts?
The drop in apprenticeship starts in this period can be explained. The Apprenticeship Levy came into effect in May 2017. Many businesses immediately signed up to the Digital Apprenticeship Service. However, it is slightly alarming that to date, barely half of Levy paying businesses had done this, which immediately precludes them from using their funds for programme delivery.
At the same time there were some significant changes to funding allocation to colleges and training providers. This was a period of significant uncertainty for training providers which has since been alleviated with new contracts and a new tendering round for future budgets (albeit, the results of this have been delayed which may affect apprenticeship starts from January 2018).
What is our advice to Yorkshire businesses?
The first bit of advice is for businesses that are paying Levy but are not utilising it. It is vital that they sign up to the service. Their Levy funds can be used for a wide range of programmes for new and existing staff and they must see this as being more than just a tax. It is money that can be re-invested into the business through training and development.
Our second piece of advice is for non Levy paying businesses. There is still plenty of funding available to support SME businesses and it is really important to speak to a training provider that offers delivery to your business sector.
Our third bit of advice is to support apprenticeships in Yorkshire!
Apprenticeship Advice and Guidance
If you would like any advice and guidance on how apprenticeships can work for your business then please speak to the team at Yorkshire Apprentice.