There are currently around 426,000 apprentices in Australia compared to 250,000 in England. As a percentage of the working age population this equates to about 2.8% in Australia and 0.7% in England. It is therefore not surprising that we need such a high-profile entrepreneur - Sir Alan Sugar - to be leading the national Apprenticeship marketing campaign. Those involved in delivering or promoting Apprenticeships are well versed in the potential barriers to engaging with employers or school leavers in England. However, the questions are: why are Apprenticeships so much more popular in Australia and do the same barriers exist?
Why Apprenticeships work in Australia
Apprenticeships in Australia are clearly successful and there are a number of reasons for this. There is a real need for apprentices in construction and traditional trade areas as an existing housing shortage is being further stretched by the high influx of immigrants in recent years. Employer engagement is improved through the government financial incentives offered to employers at both three months and at the end of each programme; totalling in the region of AUS $4,000 - just under £2,000 - a sizeable sum for any business. Doing an Apprenticeship may seem like an attractive option for some as it qualifies a young person for benefits in Australia. The Australian system means that those under 21 only receive benefits if they are actively looking for work or studying full time.
Australia’s culture and traditional perceptions have also played a role in the popularity of Apprenticeships. Historically, Australia has had a predominantly blue-collar workforce and there is less of a division between the vocational and academic camps than we experience here in England. Some Australians are, of course, pro-university but there are also those that see an Apprenticeship as a complementary pathway to higher education and not as a lesser option for school leavers.
Then, there is the Apprenticeship itself. Unlike in England, where there are individual frameworks, in Australia there is a national training package which lasts for four years and is based on eight modules of training. It is valued as a quality programme and recognised across different industries. In Australia, all apprentices must first secure a job or be employed by a training organisation to begin their Apprenticeship. Whilst Apprentices in England can also get started in this way, it contrasts significantly to the alternative programme-led option available in England. This is where learners start a programme-led Apprenticeship at college and then find an employer to do the work-based learning component with at a later stage. The benefit of the Australian approach is that apprentices are guaranteed on the job training and are unlikely to be left in limbo not being able to complete the full programme if they cannot find an employer willing to take them on.
Beyond these overarching factors, we should consider the Australian Government’s mechanisms for engaging employers and recruiting budding apprentices - clearly an approach that works. One such mechanism is the Group Training Organisation (GTO). There are around 180 GTOs, also known as Group Training Companies, who are highly valued by employers. The GTO takes on the responsibility of recruiting apprentices and hiring them out to host employers throughout their programme. They will, in most cases, be employed at the end of their programme by their last host employer or the GTO will try to find them another job. The Apprenticeship delivery is in many cases subcontracted out to one or more providers but the GTO is responsible for the quality and continuity of training, and for supporting the apprentice.
GTOs work with about 35,000 host employers and cover 14% of the apprentice population. They primarily appeal to small or medium businesses. According to Ben Bardon, Chief Executive of Central West Group Apprentices, one reason for their success relates largely to their ability to reduce the risk of taking on an apprentice. They offer the employer flexibility. They allow the employer to trial an apprentice and if the worst happens, and it does not work out, the apprentice can go back to the GTO who will find them another host. This flexibility is especially pertinent in a time of economic downturn. The GTO also reduces some of the bureaucracy and worry for the employer as they pay the apprentices directly through a finely tuned payroll service.
Comparisons and challenges in England
Group training is nothing new to England either. Similar in principal to the GTO, Group Training Associations (GTAs) emerged mainly in the 1960s and were supported by industrial training board levies. A GTA trains individuals on behalf of a group of employers and were typically in engineering and construction. Many GTAs are sector specialists and some now deliver in a range of disciplines including automotive, social care and logistics. They work closely with employers in their industry to develop and deliver their own Apprenticeship programmes to their own staff. There were originally around 150 GTAs but, due to cutbacks in funding and mergers with colleges, there are now around 40.
One of the principal challenges for the Apprenticeship system in England is to increase employer demand and to create enough places for those who want one. The second challenge is to encourage people in England to see Apprenticeships as a mainstream option alongside university when leaving school. The underlying problem is negative perceptions towards Apprenticeships, or at least what people stereotypically class as an Apprenticeship. The first job for policy makers is to deal with the snobbery towards Apprenticeships in our very much academic orientated society where vocational learning is seen as the underdog to a degree. These socio-cultural perspectives are influencing both parents and in turn young people who may not consider the possibility of setting out in life as an apprentice in hands-on roles such as plumbers or engineers. Undoubtedly, Sir Alan Sugar is giving a higher profile edge to the Apprenticeship brand and shaking up historically negative views of apprentices. It is unlikely however, that Sir Alan’s campaign alone is going to encourage all types of employers to see the wider benefits and to ultimately take on an apprentice. What would really make a difference is if he could showcase success stories from his own or other organisations.
So what can we do?
Government has already taken a leap forward by creating the National Apprenticeship Service to support employer engagement and the delivery of Apprenticeships on a national level. However, both Government and Apprenticeship numbers would benefit further from reviewing delivery and employer engagement.
The key is to draw on successful models such as the Australian GTO and others like them. The renewed interest in GTAs and ATAs in England lies in the emergence of organisations such as the London Apprenticeship Company which has been coined an Apprenticeship Training Agency (ATA). The ATA broadly replicates the Australian GTO model where apprentices are employed by the agency and placed with host employers. Lord Young, former Minister for Skills and Apprenticeships took the plunge and recognised that GTAs and ATAs should form part of their strategy to boost Apprenticeship numbers. £7 million of funding is being offered through the National Apprenticeship Service to kick start 10 or more GTAs or ATAs that fit certain criteria.
As part of this strategy, Government should also consider not only how to seed fund, but also how to help grow sustainable GTA and ATA models. This will involve understanding how best to support them going forward, as well as helping them to respond to changes in the economy. We often see short-term policy making in this country, with initiatives fizzling out over time or with a change in Government. Apprenticeships require a long-term strategy. Government needs to encourage providers to adopt and develop these tried and tested models on both a larger scale as well as designing them to target specific sectors. This long-term commitment also requires supporting established GTAs who have proven that they are working well to engage employers and are offering responsive provision.
Responsive funding: a demand led system
To make Apprenticeships work in England we need to review how truly demand-led our system really is. What would happen if the success of Sir Alan Sugar and the Apprenticeship marketing campaign created a huge rise in demand which outweighed supply? Again, here we can learn from our Australian counterparts. Their system is not restricted by budget or caps on provision. Essentially, if demand for Apprenticeships suddenly increases, the Australian Federal Government steps in to find additional budgets and rise to the challenge. If demand suddenly increases in England, we do not have a contingency plan to respond.
Ultimately then, even if we increase demand for Apprenticeships in England we could be setting ourselves up to fail if we cannot match it with adequate provision. The mismatch between supply and demand is also likely to be heightened due to the recession and rise in unemployment. Many young people, and adults alike, who would have previously considered a job, may be turning to work-based learning, and possibly Apprenticeships as an alternative. In contrast there will be fewer employers offering Apprenticeships due to a lack of work, particularly in the traditional industries of construction and manufacturing.
All the progress currently being made to change perceptions and increase demand could be undone if parents, employers and learners become disillusioned; therefore not solving the problem. This is an important consideration for government. If funding cannot match demand this creates a problem. If we truly want a demand led system then funding needs to reflect this and Government should take responsibility for driving this forward.
Liz Walkley is a Programme Manager at CFE.
The above article appeared in the September edition of Workplace Bulletin.