The apprenticeship system must evolve to succeed

We must listen to industry to refine the apprenticeships system and remain globally competitive

We must listen to industry to refine the apprenticeships system and remain globally competitive

26 Nov 2023, 5:00

The 2017 reforms to the apprenticeship system were ambitious, and rightly so. They demonstrated two fundamental understandings: first that for apprenticeships to succeed they needed a long-term, sustainable funding source, and second that they had to be rigorous if they were to win the confidence of employers and learners. The apprenticeship levy was designed to deliver the former while a host of other measures would ensure the latter.  

From my conversations with some of the country’s leading apprenticeship employers, it has become increasingly clear that several of the provisions within the 2017 reforms that were aimed at driving growth and quality are now proving counter-productive and restricting take-up.  

A recent roundtable discussion on the topic hosted by Ofsted outstanding apprenticeship training provider, MBKB and attended by some of the country’s leading apprenticeship employers repeated many of the calls I have heard from industry. 

What’s the rush?

While the levy has successfully driven employer-funded apprenticeships, there is a feeling among some in industry that the two-year expiration on levy funds is inadvertently encouraging the adoption of a ‘spend it or lose it’ mentality. This leads to rushed financial decisions rather than strategic workforce development.  

We need a more nuanced and flexible approach to the levy. Extending the expiration period could encourage more thoughtful expenditure, aligning training initiatives with long-term business strategies.

Tailored to suit

There is also a common feeling that reform is needed to address the rigidity of apprenticeship minimum duration requirements. 

The 12-month minimum length of apprenticeship, for example, while suitable for some programmes, does not necessarily align with the operational demands of others. For instance, I have heard that certain schemes, such as in retail and customer service training, would be more effectively delivered in shorter, more intensive programmes – to the benefit of apprentices, training providers and employers. Meanwhile, others are being completed too quickly.  

A reform to the system that legislates for a more flexible approach to minimum length requirements would enable better tailoring of apprenticeships to specific job roles and industry needs.

Pay and progression

Poor retention rates in apprenticeships also demand attention. The feedback from industry leaders suggests that a combination of factors (including the apprenticeship wage structure and lack of clear progression pathways) contributes to high drop-out rates.  

Some have argued that increasing the apprenticeship minimum wage could positively impact apprentice retention rates by providing financial stability and demonstrating the value of their contributions. In turn, this would enhance job satisfaction and commitment. This is an option, among many, that the government could consider to improve retention. 

A changing world

The way forward is not to dismantle what we have built but to listen, adapt and refine. This refinement is not just about making minor tweaks; it is about ensuring our apprenticeship system remains relevant, responsive and effective in a rapidly changing economic landscape. Modifying our approach as the circumstances change is a cornerstone of good policymaking.  

Continuous examination reforms in the UK since 1986 underscore a crucial lesson to policy makers: complex policies demand calculated, large-scale improvements over time, ensuring long-term benefits and stronger foundations for future generations. There is no reason this dynamic logic of policy making should not be applied to improving the apprenticeship system. 

As we see a shift away from traditional emphasis on university degrees, apprenticeships stand to play a pivotal role in filling the skills gap. This will only happen if they are attuned to the evolving needs of learners and employers.  

While the foundations of the 2017 apprenticeship reforms are robust, targeted amendments are necessary – and will continue to be. By refining the levy, introducing flexibility in programme lengths and addressing retention challenges, we can ensure that our apprenticeship system remains a key driver of skill development and economic growth.  

And by continuously drawing on the wisdom of industry, we can sustain them as the pivotal and adaptive avenue for career advancement today’s ever evolving world requires. 

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One comment

  1. Bottom line is that the levy was created for one thing, to move numbers around the Treasury balance sheet.

    Instead of just spend, you tax employers (income), then give some of it back (spend).

    However, it has had consequences.

    1. Employers were told it was ringfenced money and that they’d get back more than they put in. It hasn’t turned out that way.
    2. Businesses exist to maximise profits, or at the very least minimise cost. So, many of them rebadged existing training to spend their apprenticeship tax on. Resulting in fewer starts, fewer new employees on apprenticeships, fewer young people, fewer disadvantaged, fewer SMEs, fewer L2&3, disproportionately fewer outside the southeast etc.
    3. Tackling non achievement became that much harder. You can’t very well blame the employers if they are paying for it. It therefore always has to be failure of the provider or the apprentice, regardless of the actual reason.
    4. It spawned a new funding band method with ‘affordability’ as its primary concern. Eventually that erodes quality, ensuring there are no winners.

    We need to go back to considering what apprenticeship is and where it is appropriate.