There have been positive results from the latest Evaluation surveys of employers and apprentices…
- Eight in 10 employers, and nine in 10 apprentices are satisfied with their apprenticeship offering
- 83% of employers would recommend apprenticeships to others
- 92% of apprentices thought they had developed relevant skills and knowledge in their area of interest.
These are some of the positive headline figures from the recently published Apprenticeship Evaluation employers survey and the Apprenticeship Evaluation learners survey reports, the fieldwork for which we conducted in early 2017 on behalf of the Department for Education.
…accompanied by a drop in apprentice starts
While the Evaluation has showed largely positive results this has been accompanied by a considerable drop in apprentice starts in 2017, a drop that a number of media outlets were quick to pick up on.
Most strikingly, there has been a 59% fall in the number of new apprentices starting between May and July 2017, compared to the equivalent period in 2016. This is a worrying decrease given the government’s drive to achieve 3 million apprentice starts by 2020.
Impact of the Levy
A key contributor to this downturn is the 2017 apprenticeship funding reforms. The introduction of the Apprenticeship Levy in April was the headline act, requiring large businesses to pay a levy charged at 0.5% of their annual pay bill. However, the reforms also affected all other businesses offering apprenticeships, who are now required to pay 10% towards the cost of apprenticeship training.
Previous research we conducted had suggested the Levy may result in a drop in apprentice numbers due to employers taking time to understand and respond to it, especially in the context of uncertainty resulting from Brexit. This seems to have played out accordingly although the drop has been perhaps more dramatic than anticipated. We therefore sought to find clues in the Evaluation data to help contextualise this decrease.
What can the Evaluation tell us?
Despite the overarching positive narrative from the Apprenticeship Evaluation surveys, there are signs of a less rosy picture within.
One of the common themes running throughout employers’ responses in the survey was a concern about a lack of government communication and support relating to apprenticeships.
Only two-thirds (68%) felt there was sufficient information, guidance and advice available, and this represented a drop of five percentage points since 2014, suggesting the pace and extent of apprenticeship reforms have left some employers unclear on the evolving apprenticeship landscape.
And despite our fieldwork period ending only a month before the reforms, still two-fifths of all employers offering apprenticeships said they were not aware of them. More specifically, fewer than half (46%) said they felt prepared for the funding reforms, and only a third of this group had started making changes to adapt accordingly.
Among those who were aware of the reforms, concern about their impact was also apparent, especially among smaller businesses: only nine per cent of those not eligible to pay the Levy reported a likely increase in apprentice numbers as a result of the reforms, with 17% reporting that they would decrease numbers and 4% who would stop altogether.
Overall, apprenticeships are continuing to deliver positive impacts for both employers and apprentices; however it is crucial that recruitment picks up again after the uncertainty around the levy, if the 3 million apprenticeship target is to be reached. There is also a danger that, following the funding reforms, apprenticeships become the preserve of larger businesses, potentially restricting employment opportunities for young individuals in certain regions.
Findings from the Evaluation survey suggest improving communication channels between government and business, and developing associated support mechanisms, will be critical if businesses are to respond and adapt to the reforms.
The next figures on apprentice starts will be eagerly anticipated to see if this is a minor dip resulting from initial uncertainties regarding the funding reforms, or the start of a longer-term trend.
For more information speak to blog authors Andrew Skone-James and Poppy Curd.