The Open University has reported that £1.28 billion paid into the apprenticeship levy pot by UK employers last year is sitting unused. If you have an annual wage bill of more than £3 million then you already pay a levy of 0.5% on payroll collected through PAYE. For smaller employers, funding for apprentices is generally free up to the age of 18 and for those over 18 a small contribution of just 10% towards the full cost of delivery is required.
What many organisations are not aware, is that funds expire after 24 months and will start to disappear as of early Spring next year!
The two year ‘use it or lose it’ clause will be money going down the drain for work-based learning, funds that could be readily used to train new (and old!) employees. Confusion continues to reign with regards to the levy – more critically around who it is for and how to spend it? Whilst most employers use this for new recruits at entry- or junior- level, it is often overlooked as a means to support and re-skill existing employees at any level of the organisation. There is a real chance for organisations to generate value from their levy to fill skills gaps in middle and senior management, and more critically, to access new digital knowledge and expertise for emerging technologies that your business wants to use.
A very simple search on the apprenticeship standards index show frameworks exists for level 3 (equivalent to A-level or BTEC study) up to level 7 (equivalent to bachelors degree) courses that comprehensively cover roles in infrastructure, network engineering and digital solution specialists. An apprenticeship is a journey – with no upper age limit – that instils a sense of curiosity, lifelong learning and discovery. So if it is easy to find a role and you have money available in the levy pot, why are 93% of managers still not making full use of it?
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It is often the result that managers avoid hiring unqualified employees, yet most will allow their staff to become underqualified over time. The mindset that you need to hire a 16- to 18- year old in the new year is veiled naivety, especially when the levy can be used on existing employees that already make your company successful. Whilst many of us find ourselves refusing staff training because of costs, the levy is a readily available pot of cash specifically for this. In the wake of new and/or unfamiliar technology that your staff are not currently experts, apprenticeships serve as a gateway to target your skills shortage. If we can agree that you need to train your staff in order to get the best out of the workforce, then by extension on-the-job training is without a doubt more beneficial than waiting for a ‘wet behind the ears’ graduate to settle in or, like several other businesses, making one of your suppliers rich through the need for outsourcing.
As strategic plans turn towards 2019, with plenty of political and economic uncertainty on the horizon, those that fail to innovate and adapt will be killed by the competition. The key is to familiarise yourself with the process, which can be easily solved if you follow the four steps to successful apprenticeship engagement.
- Check your pot – If you haven’t already checked, many HR departments are familiar with the Employment Payment Summary (EPS) portal and can facilitate your access by adding you to the account. If not, or you are a non-levy paying employer, then you can register for the apprenticeship service. If both require some prompt email exchanges over a quiet Christmas, then you can use a simple online tool to estimate if your organisation will pay the apprenticeship levy and to check how much funding you will receive.
- Familiarise yourself with your skills gap and need – Network and data security have ranked the most important skills for three-quarters of IT managers moving forward. Whilst we can see the demand, a shortfall of computer science graduates has led to industry needing around 140,000 new entrants each year. If you were hoping to wait for the next bit of a talent, it is highly unlikely they are coming soon. So you should consider the vital role apprenticeships will play in growing your own talent pool.
- Successful apprentices require a good mentor – Have you got someone in your organisation who is a role model, can take the lead and you trust to share their knowledge and expertise? An apprentice, new or existing to your organisation, will need some initial introductions to the role, fresh expectations and direction; as opposed to throwing them straight in. The sooner you bring these mentors into your thoughts and discussion, the easier it is to shape what you are looking for.
- Find a reputable training provider – Most organisations get caught in a trap of using cheap independent training providers, many of which are suffering in the aftermath of 3aaa’s demise. In most instances, they lack the familiarity and facilities offered by your local college or university. Keep them in mind as they offer a wealth of subject-specialist knowledge that your organisation may need moving forward, without having to deal with a variety of providers for different areas of your business. They also have dedicated teams that can guide you through the next steps with ease.
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It is worth noting that the apprenticeship program of study can be no shorter than 12 months in length. If you have a need to migrate all your servers in January and nobody in your team knows where to start then an apprenticeship is not necessarily the answer. But if you can see right now that your organisation lacks an area of expertise, or from the list of standards you find an area of interest to your organisation’s growth in 2019, then strongly consider how an apprentice can better prepare your business for the future (and give your existing staff some room to grow). Whilst you ponder the use of apprentices in the new year, let’s leave you with a final thought: if we are all lifelong learners and apprenticeships fill your training needs, then should everyone in your organisation be an apprentice?
Written by Dr Laura Marulanda-Carter, Head of Curriculum IoT at Milton Keynes College