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Advertorial: in association with Amazon

How to reform the apprenticeship levy

We’ve made a success of apprenticeship funding, but it must evolve to reach its potential.

By John Boumphrey

I know, from talking to people in my capacity as Amazon’s UK country manager, that while many have driven past one of our warehouses beside a motorway, few have a really good idea about the work we do inside.

It often surprises people in policy and education to hear we’re one of the UK’s largest creators of apprenticeships. We began offering apprenticeships 11 years ago, and we’ve since created more than 5,000 roles.

Our apprenticeship programme contains 40 different schemes, from robotics to sustainability, from Level 2 (GCSE-equivalent) up to Level 7 (degree). These are serious jobs that lead to serious qualifications. More than 70 per cent of our apprentices complete their programmes each year, and more than 80 per cent of those have progressed to a permanent role at the company after finishing their training.

We’re proud of what we’ve been able to offer, both to young people at the start of their careers and to those of all ages who are keen to reskill. However, we believe there are opportunities to go further.

Currently, 100,000 small and medium-sized businesses (SMEs) sell on Amazon, and we also play a significant role in the UK’s thriving creative industries, including film and TV production, which often split work between smaller contractors. Being able to use our levy funds to support apprenticeships in these smaller organisations is vital to delivering opportunity as broadly as possible. We have committed £8m to SMEs since 2021, supporting 900 learners at 400 organisations. This has included providing levy transfers for programmes with The Brit Trust, ScreenSkills, the Association Independent Music, and the National Film and Television School.

Within the world of apprenticeships, there is often a focus on higher-level qualifications. And while there is immense value in Level 4+ courses, these do not address some of the most important business needs that we see.

First, we are increasingly seeing demand for skills “top-ups”: shorter courses to upskill people in emerging technologies, such as artificial intelligence. A modernised levy could open the way for more of this kind of training to take place in the workplaces that need those skills.

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Second, higher-level apprenticeships are not where funds can do the most good. By the time someone is considering a degree apprenticeship, they are often already on the route to success. Here at Amazon, 39 per cent of the apprenticeships we offer are at Levels 2 and 3, equivalent to secondary school qualifications. Among the many inspiring people that I meet through my role, it strikes me that the ones who need the most help are those that have not – for whatever reason – left school ready for work.

Pre-apprenticeship programmes can help with those foundational skills, such as digital skills, time management, team working and problem solving. We see the benefit of such training in other programmes that we run. For example, we run a ten-week programme with Barnardo’s called the Jobs (Journey of Becoming Successful) project, which has supported over 200 care leavers and vulnerable young adults into work since 2021.

We’ve been encouraged by the Labour Party’s willingness to listen to businesses’ thoughts on the future of the levy. As it prepares detailed plans for a widened growth and skills levy, I hope that experiences such as ours will be useful.

Modernising the levy to enable businesses to support those who need extra help to get started, as well as those who want a shorter-term skills boost, will be good for workers, good for businesses and good for the country.

This advertorial was first published in a sponsored report by Amazon on 26 April 2024. Read it in full here.

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