Apprenticeships down at SMEs
By Sarah Wood
The number of apprentices at small businesses has fallen dramatically in recent years.
A report from the Chartered Institute of Personnel and Development found that the number of apprenticeship starts at small and medium-sized companies (SMEs) fell by 49% between 2017 and 2021.
There was also a 14% drop in apprentices at large companies, with overall apprenticeship starts down by 31% since the introduction of the apprenticeship levy, as reported by The Times.
The apprenticeship levy requires businesses with an annual wage bill of over £3m to pay 0.5% of payroll costs into a training fund. Small business should be able to access levy funds, but over the past five years £4.3bn was raised and not spent on apprenticeships.
The Chartered Institute of Personnel and Development said poor returns from the levy coincided with high vacancy rates and skills shortages across a range of industries.
It said the apprenticeship levy should become a 'flexible skills levy', allowing for shorter and more flexible training courses - from lorry driving to coding - to directly tackle skills shortages and deliver immediate value to the economy.
It also recommended greater incentives for SMEs to hire apprentices, as well as fast-track apprenticeships for experienced workers working towards qualifications.
The Federation of Small Businesses (FSB) said any reforms to the current levy system should guarantee small businesses the same level of funding for apprentices as they currently get and that reforms must work to turn around the big decline in apprenticeship starts.
Copyright 2023 Moose Partnership Ltd. All rights reserved. Reproduction of any content is strictly forbidden without prior permission.