Tailored programmes and flexibility: how to improve apprenticeships

Introduced in April 2017, the apprenticeship levy is an opportunity to future-proof your organisation by developing high-quality talent that can improve organisational performance. The levy requires large employers – with a wage bill of more than £3m – to invest 0.5% of the annual bill on training new or existing staff.

It was introduced to achieve the government’s pledge to create 3m more apprenticeships by 2020, with the goal of increasing skills and addressing the UK’s poor productivity record. But more than a year on from the levy’s introduction, some teething issues remain unsolved.

The Open University’s report, “The apprenticeship levy: one year on” found that 84% of business leaders in England supported the levy in principle and more than half were more positive about it than a year previously. The report, reflecting the views of 750 senior UK business leaders, found that around two-thirds of businesses thought the levy could address skills shortages and benefit the UK economy, and more than half believed it would improve productivity.

Apprenticeships offer incredible benefits to employers – the chance to retrain their workforce in an age of sweeping technological change, to build up higher-level skills, to attract and retain talent, and to improve productivity and organisational performance.

While two in five organisations support the apprenticeship levy, they would like to see some changes. One of the main issues cited is the rigidity of apprenticeship standards. Even though employers have input into the design of these standards, the “one size fits all” approach does not take account of the varying needs of businesses of different sizes and in different sectors. Often, companies cannot tailor apprenticeships to their unique needs. Smaller companies in particular tend to need more agility as their business and hiring needs can change rapidly as they grow.

The OU’s research also noted that managing the levy’s 20% off-the-job learning requirement can be problematic for organisations looking to use apprenticeships to develop their existing staff. Losing the equivalent of one day a week to training can be too much, despite the potential for long-term gain.

In some apprenticeships, like ones delivered by the OU, learning can be done flexibly, helping workers fit training around their jobs. A similar approach to apprenticeship levy programmes would ensure that organisations have access to the skills they need both now and in the future.

In response to the report’s findings, the OU calls for the introduction of “modular apprenticeships” that are tailored to organisations’ individual needs, whether it be acquiring occupational knowledge, developing “soft skills” such as communication, or digital capability. David Willett, corporate director at the OU, says: “All of these together could combine to form a personalised apprenticeship, with the flexibility to evolve as the political, economic and technological environment shifts.”

The OU already offers the “Open Degree”, which lets students pick from a broad array of modules and design a bespoke curriculum that matches their career goals. The modular format is becoming increasingly popular – the Open Degree now accounts for one in five of the undergraduate degrees awarded by the OU. And because OU apprenticeship degrees are delivered via a distance-learning approach with face-to-face support and technology-enabled learning, there is added flexibility, which allows apprentices to fit their training around existing work commitments.

A modular apprenticeship programme is an attractive proposition, says Willett: “We have the specialism required to develop new modular degree-level apprenticeships that would put employers firmly back in the driving seat, with access to training that suits them and their employees.”

While flexibility is one problem, organisations would also like a simpler process to access funding. Employers pay the levy in the same way they pay income tax and national insurance contributions – through the PAYE process. Levy-paying organisations then create an apprenticeship service account to receive funding to spend on apprenticeships.

Some employers view this as a long and complex system. In fact, the cost and difficulty of navigating the levy may have discouraged some employers from launching apprenticeships. In the first three terms of the 2017-18 academic year, the number of apprenticeships starts fell by 34% to 290,500 when compared with the same period the year before .

While levy-paying organisations are positive about the scheme overall, they would like to see changes to the way it works – only 8% want it to remain the way it is now. About two-fifths – 39% – want a simplified process of accessing levy funding, and about one-quarter want to be able to use the levy to pay apprentices’ salaries, and remove the requirement that apprentices spend 20% of their time learning off-the-job.

Because the levy is relatively new, wholesale changes to the system seem unlikely anytime soon. In the meantime, the OU’s report makes comprehensive recommendations for what companies can do to develop their apprenticeship programme.

The first step is to assess your organisation’s business strategy to identify future talent needs. Organisations should then review the skills of existing staff and compare those with what they will need in future – making talent gaps clear. You’ll then be in a better position to understand which apprenticeship standards you need to achieve your objectives.

It is important to review your existing training programmes to see how they compare with the apprenticeship standards. Some can be directly replaced with the new standards, while others can be augmented by apprenticeships.

The next step is to search for an apprenticeship provider. There are key questions to ask them: will they help you recruit talent? Does the provider offer flexible learning, so your apprentices can meet the 20% off-the-job training requirement? A good provider will make the process of finding and training apprentices fast and straightforward, so shop around for one that fits with your organisation’s needs.

While you may be focusing on new apprentices, do not forget to consider how apprenticeship programmes will impact your existing staff. It can be a huge cultural change, so it’s key to get employees onboard, keep teams engaged and motivated.

Although changes are required to the levy, apprenticeships remain hugely beneficial to organisations of all sizes.