Next April, the government introduces the Apprenticeship Levy. What does it mean for employers? How can they maximise the opportunity? And what are the barriers to doing so?
26 of us met at The Delaunay on 9th June to discuss the issues and opportunities, and also to hear from Sue Husband, the head of the National Apprenticeship Service.
We had some fantastic people from banking, engineering, construction, law, financial services, technology and insurance join us, as well as a few experts including Euan Blair from the WhiteHat Group, Sam Berthoud from Proversity and our co-host, the wonderful Kate Temple-Brown, who was most recently Head of Early Careers at the Bank of England.
So what did we learn? For me, it was the three Ps.
Perception – a lot of research tells us that the vast majority of parents still harbour a desire to send their children to university – despite the cost – as they believe it offers a better prospect of employment. Equally, less than 15% of school leavers have their heart focused on an apprenticeship. So what did our group think? There was a lot of discussion about the perception of apprenticeship. Traditionally a ‘trade’ rather than a modern career programme. The perception is not just a problem with parents and school leavers themselves; but also stakeholders in employers. Law firms and investment banks, for example, are big recruiters of graduates (and currently you need a degree to practise law); so how do you convince stakeholders to invest money and time into ‘non-graduates’? But this is just as true in other organisations, especially where employers are now looking to invest in higher apprenticeships.
Purpose – apprenticeships can be seen as the ‘poor-man’s graduate scheme’ or simply a way of taking part of the current workforce and turning them into apprentices (because then we can draw on the levy). But our group were adamant that it is much more important than that. There is a great opportunity to build a pipeline of talent, appeal to different sections of the community (one business has one type of apprenticeship for ex-offenders), and develop new skills. It was interesting to hear one organisation that talked about creating a specific qualification for the apprenticeship – rather than simply taking them on the same track as everyone else. We also discussed how you can give apprentices a more rounded experience, rather than giving them a very narrow, technical focus. Many people commented that apprentices often mature quicker (than some of their graduate peers) and also remain very loyal to the organisation.
Process – Sue covered a great deal of information here about the levy, employer contributions, digital accounts and how you draw down on the levy. Everyone, please take note: it’s not long until April 2017, so start looking into this now because it did sound a little more complex than I had realised. You can find out some of the specifics here. Also, the Levy can only be used for Training. Not for recruitment. Or for re-organising your organisation to be able to absorb them. And the Training can only be provided by government-approved providers. At the moment, this is a very small pool of providers, but in the future, this will be vastly widened and organisations can apply to be accredited themselves, as much of training for apprentices is provided in-house. Again, organisations need to start looking into this as soon as possible. Otherwise you may be at the mercy of external training providers only.
Some organisations are facing a huge Levy bill – not just millions, but tens of millions. Some employers may never be able to recoup the Levy because they won’t be able to recruit so many apprentices – at least not in the short term. But what was really engaging is that employers (like these here) are starting to see that apprenticeships can deliver huge benefits for organisations – and not just because the government tells them so.
So, what from our perspective, can we help organisations with?
Reputation and positioning – the number of apprenticeship rose by 24% last year and next year, it will be more. Competition is going to be fierce. But also there will be a need to position your apprenticeship appropriately – not simply as an alternative to a degree.
Engagement – graduate recruitment is a fairly well-trodden and predictable path. Apprenticeships much less so. Equally, apprenticeships are often more regional in recruitment. And there’s a need for closer engagement to convince school leavers themselves, as well as parents – and influence school teachers and careers advisers.
Experience – how do you make the apprenticeship experience the very best it can be? This is a generation used to being connected, used to collaborating and used to having a voice. There are lots of interesting ways to help apprentices to collaborate better and contribute more.