August 2, 2017

Are you taking full advantage of the apprenticeship levy?

It is all too easy for employers to view the new apprenticeship levy in a negative light. It’s a cost, it’s a hassle, it entails new processes and procedures, it’s an imposition….However, there are actually several things about the new approach to apprenticeships that are good for employers and the wider workforce, not just apprentices.

That’s the message behind a recent In-Focus Report by the Open University and the benchmarking organisation, Towards Maturity. Called ‘The Work-Based Learning Dividend: Learning from the Apprenticeship Model’, this report says that rather than view the apprenticeship levy as a burden, employers need to embrace what the apprenticeship model offers.

“Looked at in isolation, the levy can be seen as just a tax – but to fully realise the opportunity, a much broader view is needed, one that puts learning at the heart of the organisation,” says David Willett, director of corporate sales at the Open University. “Much can be gained – and indeed, learned – from apprenticeships within the context of successful workplace learning.”

There are so many pieces of research and so many articles that demonstrate that work-based learning is good for learners and good for organisations. It’s the way that many workplaces are now being engineered. Apprenticeships are an extension of that – apprentices learn their trade through a programme of formal learning while also continuing with their job and learning through experiential work. The learning experience is designed around real-life situations. It is active, work-based, task-based, current learning at its best (or that’s what it should be). And the learner is able to put their new learning into practice as soon as or shortly after they have learnt it.

Apprenticeship learning focuses on the job – an apprentice learns the skills needed to effectively do the specific work they have been hired to do.

This is the kind of learning that L&D knows it needs to deliver not just to apprentices, but to all learners. That’s why Towards Maturity and the OU are highlighting the benefits and importance of the apprenticeship model in this way.

Despite reports such as this Towards Maturity/OU report and the fact that the levy has been in existence for a few months now, many employers haven’t yet grasped what the levy means for them and how to make it work for them. A separate piece of research by the OU found that a fifth (18%) of apprenticeship levy-paying employers are in the dark about how the scheme works. Worryingly, 2% don’t know anything about the levy at all.

It’s not all bad news though. Most senior managers (80%) polled in the research say they have a good understanding of how the levy works and more than four in five (85%) believe the levy will have a positive effect on their organisation. An even higher number (87%) think the levy will benefit the UK’s productivity levels and economy as a whole.

Now, improved productivity and an improved economy are two significant benefits that every employer should be aiming to achieve. There is a much documented productivity gap in the UK and a shortage of skills. According to the Towards Maturity/OU report, implementation of the apprenticeship levy and a greater focus on work-based learning will improve productivity and provide employers with the skills they so desperately need.

Some employers have realised this and are already using the levy as a way to boost their skills base. Over half (58%) of senior managers polled in the OU research said they will be using the levy funding to offer training to existing employees. In particular, they intend to focus on areas where skills are lacking, such as digital skills and management.

The apprenticeship levy is a legal requirement for employers in England with an annual wage bill of over £3 billion. Any employers who fall into that category need to ensure not just that they comply with the legislation, but also that they take full advantage of what the levy means and how work-based learning can improve their organisation’s productivity and performance.

To find out more about the apprenticeships that DPG offer, call 0330 660 0220 or click here.