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Stats suggest apprentice levy system is failing

23 Feb 18 Latest government statistics confirm a substantial decline in new apprentices, suggesting all is not well with the supposedly game-changing apprenticeship levy system.

Apprentice numbers are down 35%
Apprentice numbers are down 35%

The Department for Education’s apprenticeship and levy statistics for November 2017 show that apprenticeship starts in November 2017 were down by more than a third compared with November 2016.

In November 2017 there were 27,000 apprenticeship starts across all industries, compared to 41,600 starts a year before. The numbers are not broken down by industry.

The Federation of Master Builders (FMB) said this showed the need to reform the apprenticeship levy system, which was introduced in April 2017 with the intention of boosting apprentice numbers, not shrinking them.

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FMB chief executive Brian Berry said: “The disappointing results show a 35% drop in apprenticeship starts in November 2017. These are not finalised figures, but even allowing for a certain degree of change, this looks like a clear downward turn in new apprenticeships. Unfortunately, this is not altogether surprising given the intrinsic flaws in how the apprenticeship levy works. The lack of flexibility in the value of vouchers which large employers are able to pass down the supply chain to smaller subcontractors who work for them is a key issue. At present only 10% of vouchers are able to be passed down, however larger construction firms do not tend to directly employ large numbers of on-site tradespeople. This means that there is a real danger that these vouchers are not being spent on training the key skills that the industry so desperately needs.”

Mr Berry concluded: “In the long term, the only way we will be able to address the chronic skills crisis that is impacting the whole sector is by recruiting and training more new entrants. It is imperative that we make moves to iron out the flaws in the apprentice levy, given that more than two-thirds of small and medium-sized firms (SMEs) in construction are facing difficulties hiring bricklayers. This has increased by nearly 10% in just three months which demonstrates the swift worsening of an already dismal situation. What’s more, with the UK set to leave the EU in just over a year’s time, and our access to EU workers in doubt, the next few years will bring extraordinary challenges to the construction industry. It’s only through close collaboration between the government and the construction sector that we will be able to overcome issues such as the skills crisis.”

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