This week thousands of schools, apprentices and employers marked National Apprenticeships Week – and there is plenty to celebrate. From individual stories of the transformational impact that apprenticeships are having on disadvantaged young people, to businesses who have radically changed how they recruit to get more apprentices through the door, the value of apprenticeships is clear.
But our research shows that there is much more to be done. Through a Freedom of Information request, we’ve found that since 2018, more than £1.2bn has been raised in apprenticeship funding by England’s biggest public sector bodies – NHS Trusts, local authorities, police forces. Yet more than £300m has been unspent and returned to the government. That’s £1 in every £4, which could have created an additional 30,000 apprenticeships.
While some of this funding will be reinvested into apprenticeships for small employers, some of it will not. And the government isn’t transparent when it comes to setting out how billions earmarked for apprenticeships every year – across all employers – is actually spent. This is in part because the Treasury treats this issue as a “cash cow”, siphoning off investment for apprenticeships towards other priorities.
The number of apprenticeship starts have dropped by a third since 2017, from nearly half a million to 337,000, for other reasons too. The absence of support for employers – or line managers – and the administrative difficulty of enrolling apprentices are routinely cited as issues. Employers have been clear that Whitehall bureaucracy is undermining their ability to invest in their workforce. The result is that fewer people who want to upskill are given the opportunity to do so, employers continue to face acute workforce challenges and UK plc is less competitive and denied economic growth. Our productivity has continued to lag and whoever wins the general election will have to address this.
Nowhere else is this clearest than in the public sector, which is under immense financial pressure. Throughout the period that police forces returned millions, they were recruiting nearly 20,000 police officers. NHS Trusts continue to face acute staff shortages amid rising demand. And in local authorities (nine in ten councils are experiencing staffing issues), apprenticeships can and should be a route for them to rebuild.
Despite these pressures, short-term decision-making has been prioritised over longer-term sustainability. Many authorities have had to introduce recruitment freezes – which makes creating apprenticeships increasingly difficult. Likewise, with public sector capacity stretched, employers are less able to cover the “off the job” training that is part and parcel of an apprenticeship. Plenty of private sector employers – from retailers to social care providers – share similar frustrations.
With a growing body of evidence on the “apprenticeship dividend” – such as introducing new thinking into organisations, which enables them to become more resilient and agile – the inability to maximise apprenticeships in the public sector is problematic.
Why does this matter more broadly?
First, we all suffer when the frontline public services we depend on are so stretched. There are thousands of apprentices in social care and childcare. But more apprentices in those sectors are sorely needed. The next government can address skills gaps by enabling public sector bodies to retain their apprenticeship funding for more than the current two-year period. Scrapping the Apprenticeship Minimum Wage – which the Low Pay Commission is reviewing – would also help.
Secondly, creating more apprenticeships affords more opportunities for people to progress in work. Whether that’s helping vulnerable young people to access a first job, enabling people to change their careers or those returning to the workplace to reskill and upskill, or helping someone out of precarious low-paid work and on to a more stable footing, the public sector can support local communities and economies.
There has been significant concern about the requirements on the public sector to demonstrate their productivity too. Some of this is political theatre, but beyond that there is scope through apprenticeship creation to create more productive workforces.
There are great apprenticeship initiatives right across the public sector, but if we want to tackle the skills crises that undermine the services we rely on, the government needs to take action. Enabling public sector employers to maximise their Apprenticeship Levy is a no brainer.
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