This week marks National Apprenticeship Week, an initiative that aims to highlight the positive impact that apprenticeships make to individuals, businesses, and the wider economy.
However, while the consensus may be that alternative routes to employment are just as important as university, the current landscape shows a concerning lack of investment.
The lay of the land
Despite only 37 per cent of young people taking three A-levels, meaning the majority do not follow a university-led route to employment, data reveals that just 2.8 per cent of 16-year-olds were on an apprenticeship in 2022 – down from 7.9 per cent in 1999.
If you also take into account 19 to 24-year-olds, the overall volume of young people starting an apprenticeship has remained stagnant for 20 years.
Our own figures shed further light on the state of the sector.
In January 2024, apprenticeship job advertisements witnessed a 55 per cent year-on-year decrease, despite a 47 per cent year-on-year uptick in applications.
While partly indicative of a tougher economic climate, this suggests the crux of the issue lies with the creation of opportunities for young people – or lack thereof.
The pathway to employment is challenging for young people that do not wish to follow the traditional academic route. Apprenticeships could very well be the solution, creating opportunities that bring young people closer to employers while acting as a crucial bridge between education and work.
Why, then, is the system still not fit for purpose?
An apprenticeship reboot is exactly what is needed to future-proof our labour market and address skills shortages in emerging sectors – particularly in the post-pandemic economy.
To build a strong future labour market we must begin by addressing the first steps on the career ladder. Some businesses have demonstrated strong commitment to investment in apprenticeship schemes. For example, BT Group recently announced plans to recruit more than 500 apprentices and graduates for its September intake.
Despite stifled progress over the past 20 years, there has been several attempts to improve the system yet to small avail.
Most notably, the apprenticeship levy introduced in 2017 – which imposed a 0.5 per cent tax on the payroll of companies that paid more than £3mn in wages a year – has sparked debates around its true effectiveness since its implementation.
While the levy’s sentiment appears to be in the right place, the figures on static apprenticeship uptake speak for themselves and prompt a revision of commitments.
Moving the dial
The situation must be addressed from both sides of the coin: bring young people closer to employers, and employers closer to young people.
In December 2023, educational think tank EDSK published its Broken Ladders report, detailing why the "ladder of opportunity" is broken for so many young people. Its list of core recommendations provides a pragmatic response to the current situation, highlighting the below priorities:
- Traineeships – promote the supply of entry-level opportunities and clear progression routes into genuine high-quality apprenticeships through a redesigned ‘traineeship’ programme for 16 to 24-year-olds.
- Young traineeships – enhance the employability skills of younger learners before they leave school, using a new Department for Education ‘young traineeships’ programme for 14 to 16-year-olds.
- Focus on young people – ensure apprenticeships remain focused on young people who have chosen not to follow an academic pathway by removing the option of levy-funded apprenticeships from those already qualified at full undergraduate degree level or above.
- Refine funding – prioritise the interests of young people, but without excluding older learners from starting an apprenticeship, by preventing employers from accessing further levy funding if they have trained more apprentices aged 25+ than those aged 16-24.
- ‘Kickstart’ programme – to generate more job openings for young people from the least privileged backgrounds, the government should reinstate a more targeted version of the Kickstart programme that offered subsidies to employers for creating new jobs.
Final thoughts
Businesses are shifting from a short-term mindset post-Covid towards longer-range planning, whether relating to the economy, the environment, or societal needs. Their attention towards the next generation of talent should be no different.
To build a strong future labour market we must begin by addressing the first steps on the career ladder. The need for a new and distinctive route-way for young people into work is clear.
Young people deserve to be able to choose a different career path that plays to their strengths and abilities, rather than feeling obliged to mould themselves into a one-size-fits-all university tradition.
James Reed is chairman of specialist recruitment company Reed
