Employers across the nation are missing out on an excellent opportunity to close the skills gap, and ensure the future advancement of the workforce.
Recent reports have revealed that, despite paying the Apprenticeship Levy tax that came into effect in 2017, many employers have been reluctant to hire apprentices. This reluctance possibly results from a lack of understanding about how the scheme works, and how the funds are allocated due to changes made to the apprenticeship levy almost a year after it was first introduced.
This may be compounded by further changes coming into effect from April 2019. This perceived uncertainly could, understandably, limit a business’s ability to effectively plan out their workforce and strategy for both the short-term and long-term future.
It’s conceivable that employers are asking if there is a rational justification for committing to hiring apprentices if, by 2020, further changes are to be announced, potentially making significant reform to the scheme. However, this would be an error. Employers are missing out on numerous advantages by delaying or, in many cases, not even considering hiring apprentices.
Each change that has been made to the levy has only further demonstrated the UK Government’s ongoing commitment to apprenticeships. The most recent change to the scheme included a new co-investment rate, designed to support employers in creating new apprenticeships partially funded by the government. Furthermore, in April, employers will be able to share the funds across their supply chain, incentivising the scheme further.
In addition to being financially beneficial it’s also an opportunity for employers to fill the skills gap, allowing the business to have a workforce trained specifically in the industry they’re operating in. This is supported by a 2017 report by the Government, which suggests that 86 per cent of employers reported that offering apprenticeships developed skills relevant to their business across the workforce. Further benefits reported were improved productivity, increased quality of product or service, and increased staff morale.
One of our most successful clients and the UK’s largest pub retailer and brewer, Greene King, found these statistics to be accurate, reporting that since the introduction of apprentices into their workforce, pubs have been able to improve team morale, as employees are more involved and invested in their role.
Graham Briggs, Head of Apprenticeships and Employability Programmes at Greene King said that,
apprenticeships have helped us to reduce team turnover, increase employee engagement, and provide us with the opportunity to grow our own talent by investing in our people and supporting their ambitions.
It’s clear that engaging with an apprenticeship initiative can be a significant part of building an attentive and motivated workforce. This has a positive, linear impact on greater business objectives, including staff retention, and reduced long-term training cost. This is positive news for business and the workforce alike. As such, it’s clear to see why the government and the opposition are enthusiastic in encouraging apprentice schemes.
Lifetime Training CEO, Alex Khan, said,
Apprenticeships continued to gain cross-party support and are high on the skills and employability agenda of government. The introduction of the apprenticeship levy, paired with the creation of new Standards has increased the quality and profile of apprenticeships across the nation.
We are really encouraged by the commitment we see from employers and their understanding of the apprenticeship landscape levy has grown exponentially since its inception. New Standards continue to be developed, approved and adopted faster than ever which promotes a brighter future for providers, employers and most importantly apprentices.
It’s clear that the government are committed to encouraging apprenticeships. Furthermore, the business owners that have hired apprentices show measurable, real-world positive results from taking on apprentices within the workforce. This combination makes the future for those that hire apprentices bright.