In spite of the economic downturn, the Government has shown its commitment to their planned expansion of Apprenticeships in recent weeks with several significant announcements.
Firstly, the Education and Skills Bill became law, including the requirement for all young people to remain in education or training to the age of 17 by 2013, rising to 18 by 2015. Apprenticeships are intended to be a mainstream training option for 16-18 year olds, and the increased demand will lead to Government challenges in significantly increasing the number of Apprenticeship places available.
Secondly, the Children, Skills and Learning Bill which launched the National Apprenticeship Service (NAS) was announced on 3rd December by John Denham and Ed Balls. The NAS will have overall responsibility for Apprenticeships, including achieving Government aims to have 1 in 5 young people in Apprenticeships by 2020, compared to the current figure of 1 in 15.
The Government’s objectives are all the more demanding in light of the current economic downturn, with recent figures showing a sharp rise in the number of people unemployed, with predictions of unemployment hitting 2 million over Christmas. In an economic climate where business’ bottom line is being increasingly squeezed, the perception is that training and recruitment are the first things to go.
For instance, the British Chambers of Commerce Quarterly Economic Survey found in Quarter 3 of 2008 that investment in training in the manufacturing and service industries has fallen significantly. This will make the expansion of Apprenticeships significantly more difficult, as it primarily requires an increase in the number of places with employers (rather than learner numbers, which already exceed the supply of places with employers).
The recently published report by the House of Commons’ Children, Schools and Families Committee states that they have ‘grave doubts’ over whether Government targets can be met in the current economic downturn, and reports in the media (Independent: Education, 9th October) suggest that existing Apprenticeship places are being threatened with some learners losing their place with their employer. In these circumstances the first challenge will be maintaining the number of Apprenticeships, before efforts can be directed at expansion.
The Government is trying to offset this trend by increasing their commitment to taking on Apprenticeships within Whitehall; demonstrating that cutting back on training is not the right response. Over 1,000 apprentices will work in central government departments and agencies this academic year, more than double the original target. It is also anticipated that an extra 7,000 Apprenticeship places will be created in construction through new Government procurement commitments.
All this activity publicly supports the Government’s position, that ‘businesses that don’t invest in talent are two and a half times more likely to fail, whereas those that carry on training will recover more quickly.’ (John Denham, speech to the CBI on 24th October).
According to recent studies, it is recognised by 88% of HR professionals that properly planned staff training can play a major role in addressing the challenges created by an economic slowdown. Apprenticeships are one of the many ways that can fill skills gaps within a firm increasing competitive advantage and help companies deal with tougher market conditions.
Skills gaps will certainly not go away in the economic crisis; on the contrary, it is imperative to address them to strengthen the business both now and for the future. Apprenticeships are being designed and developed to specifically meet these skills needs of businesses - for example new frameworks have been developed to meet the needs of creative and cultural firms, and other frameworks have been updated in response to employers’ needs. Apprenticeships represent an opportunity to bring the latest industry specific ideas, tools and techniques into a company to help improve processes, quality and maintain competitiveness in a time when the firm needs to be performing to the best of its ability. There is also significant support from the Government for taking on an Apprentice, as the Learning and Skills Council pays the training provider directly to cover the costs of delivery of learning and underpinning knowledge, and there may be support available for firms with fewer than 50 employees to support wage costs.
It is encouraging to note that despite some reluctance to hold back on training, leading companies such as Sainsbury's, Tesco, Superdrug and Phones 4u have all committed to expand their Apprenticeship schemes in order to ensure they have the right skills to thrive in current climes. Furthermore, efforts have been made by the Department for Innovation, Universities and Skills to raise the profile of Apprenticeships by choosing Sir Alan Sugar as the new front man for the National Apprenticeship Service. On taking up his new role Alan Sugar said that:
"People who do apprenticeships become ambitious, they're 'doers', the kind of people who will make things happen’ and that ‘it’s important that employers take apprenticeships seriously - apprentices make things happen and can help a business to grow and thrive".
Perhaps all this is a step in the right direction towards invoking the culture change needed to see an Apprenticeship as the preferred option for young people; valuable in its own right.
Sarah Hakeney, CFE’s Director for Business and Enterprise said;
‘It’s really encouraging to see the Government stand firm on its ambitions for Apprenticeships in the current economic climate. It shows how Apprenticeships should not be seen solely as a recruitment solution but also as a means to ensure businesses have the necessary skills to survive these tough times.’