If you go back to the introduction of the apprenticeship reforms under the Cameron government, the purpose of apprenticeships was clear – to increase productivity. UK employers’ investment in skills was stuck on a long-term downward trend, partly explaining the comparatively low productivity of the economy. By 2010, employer investment in skills had already peaked, at levels last experienced in the early 1990’s.
Apprenticeships were seen as the flagship programme to tackle the skills problem. Through apprenticeships, employers would invest in employee training and development, to raise productivity and improve business performance. Using a ‘Trailblazer’ process, employers were collectively invited to develop new apprenticeship Standards, defining the knowledge, skills and behaviours, which they believed were needed to be workplace competent in a defined occupation.
Levy; to enlist or tax
From April 2017, all employers with a payroll of over £3 million were also compelled to pay the apprenticeship levy, which could be used to purchase approved apprenticeships. Through the levy, the Government finally abandoned the voluntary approach to training, by making the employer both purchaser and direct funder of workforce skills.
Not surprisingly, employers have chosen to develop apprenticeships in occupational areas where they need to develop the skills of new and existing employees. Approximately 40% of these apprenticeship Standards are at higher education levels of L6 and above, demonstrating that apprenticeships are migrating upwards in level, and not just in niche areas. Think high-level digital occupations, managers, engineers, or surveyors, and in the public sector; registered nurses, social workers, teachers or police constables.
Under the May administration, the policy focus of apprenticeships has evolved. While productivity remains important, the use of apprenticeships to support social mobility is now seen as an equally important policy objective. Few would deny the importance of social mobility, nor are the objectives of social mobility and productivity incompatible. Indeed, the reforms to apprenticeships could lead to the development of new work-based progression routes into technical, professional and managerial occupations. Such progression routes are likely to be particularly attractive to individuals who were put-off university by perceptions of high debt. With a Degree Apprenticeship, a student has their fees paid for by their employer and they receive a salary throughout. Degree Apprenticeships are also likely to appeal to older individuals in work who have missed out on higher education, but have the aspiration and ability to progress to a professional or managerial occupation.
In UVAC submissions to government, we have argued that employers should be incentivised to develop and utilise work-based apprenticeship progression routes from Advanced Apprenticeships, through Higher and Degree Apprenticeships, to technical, professional and managerial occupations.
Of course, not everyone shares UVAC’s analysis, but to make our case I will refer back to the old apprenticeship system. Under the historic funding system, apprenticeship provision had no relationship to skills gaps or shortages. I’ve read many labour market reviews at national, regional and local level, and never has business administration or customer service at intermediate (lower-level secondary school) level been identified as a skills gap, a shortage, or flagged as a skills priority. Bizarrely, however, two of the apprenticeship Frameworks with the highest take-up under the old funding system were Level 2 business administration and customer service. With a clear productivity focus and employer leadership of apprenticeships, the days of dominance for such apprenticeships should be clearly numbered.
Many training providers have, however, argued that such programmes make a major contribution to social mobility. Indeed, the position of the Association of Employment and Learning Providers (AELP) is that all intermediate apprenticeship provision should be fully-funded by increasing the required employer contribution for Higher and Degree Apprenticeships, on a sliding scale up to 50%. From an economic perspective, this seems perverse. Do we really want to incentivise employers to invest in low-level skills provision and disincentivise their investment in higher-level skills provision? From a social mobility perspective, don’t we want to increase the number of progression opportunities to Higher and Degree Apprenticeships, smashing the Level 3 glass ceiling that has characterised apprenticeships for years?
A second social mobility argument is that Level 2 intermediate apprenticeship provision should be prioritised because it supports individuals, particularly young people, entering the labour market. I question whether such apprenticeships in their current form are really appropriate for 16-19 year-olds? Doesn’t a 16-19 year-old need a sound educational base for future lifelong learning, and transferable skills for the different occupations they will undertake over a working life potentially spanning 50 years? Is the current 20% off-the-job learning requirement really sufficient as a platform for future learning? For 16-19 year-olds shouldn’t the off the job requirement be increased to 40%, at least, and involve a properly structured college-based programme of study? I’d also suggest that new T levels are likely to be a far superior option to many of the intermediate apprenticeship programmes of the past.
So how do we proceed? Most importantly, the government’s apprenticeship policy is entirely appropriate. Apprenticeships should be focused on productivity, with employers deciding where to develop apprenticeships and where to use them within their organisations to best support skills acquisition. New T levels and Traineeships should be used for individuals who would have followed the old intermediate apprenticeships of the past.
And in respect of social mobility into technical, professional and managerial occupations, we have a unique once-in-a-generation opportunity to develop exciting work-based apprenticeship routes for new and underrepresented cohorts of learners. This will call for new patterns of apprenticeship delivery, new partnerships and new thinking.