The apprenticeship levy is failing…

The apprentice levy, the government scheme that requires all UK employers with a wage bill of over £3m to pay 0.5% towards funding apprenticeships, is failing.

New figures released from the Department for Education (DfE) show that the number of people starting apprenticeships fell by 59.3% to 69,800 – in the immediate quarter that followed the levy’s introduction in April 2017.

The DfE have admitted that this signifcant drop in the number of apprenticeships is likely a direct result of the levy’s introduction.

Designed to encourage employers to invest in high-quality apprenticeships, the scheme had a goal of increasing annual investment in apprenticeships  in England to £2.5bn by 2020.

Currently, the government pays 90% of the costs of training and assessing the apprentices of those employers with an annual pay bill below £3m, while companies with fewer than 50 employees that take apprentices aged between 16 and 18 have 100% of their training costs paid for.

Employers can also manage funds and invest in apprenticeship training via a special online account.

See more: Why take on an apprentice?

Verity Davidge, EEF head of education and skills policy, said:

“We’ve heard stories from companies who have hit a brick wall trying to get levy-supported apprenticeships off the ground – and not for a lack of trying. The numbers speak for themselves.

“Companies are having to tell would-be apprentices they can’t take them on because they can’t get support from the levy in time.

“That sends a dangerous message about apprenticeships when we’re trying to promote them to solve the skills shortage.”

Speaking to Startups back in March, founder and CEO of boutique marketing agency Blue Array explained the benefits of recruiting apprentices to his start-up.

Employing employs five apprentices between the ages of 17 and 21, Schnieders said he is “a huge advocate of the apprenticeship scheme”, not only because it helps to bridge the digital skills gap but because he feels employers “have a certain amount of social responsibility”:

“Having both older and younger staff has been a great way to scale our business at a comfortable rate.

“We are able to develop younger talent into senior staff but also utilise the experience of our older employees to mentor and encourage the rest of the team.

“It also helps us think beyond profit as senior staff and focus on the social element of enterprise. It makes the business far more interesting to work in and grow.

“I’d advise businesses to have a clear strategy to hiring apprentices. We like to brief the National Apprenticeship Scheme training provider on our ideal candidate and they put forward CVs that meet our criteria.

“We then arrange a Skype call to test the candidate’s level of communication and identify what their strengths and weaknesses are and plan around these.”

Interested in taking on an apprentice? Click here to read our step-by-step guide on how to take on an apprentice