After the prime minister’s bold promise of an apprenticeship for every young person, chancellor Rishi Sunak’s statement was something of an anti-climax. While the introduction of temporary incentive payments to employers offering new apprenticeships is welcome news, the incentives fall considerably short of the package of measures needed to truly guarantee every young person the right start.

Even before Covid-19 hit, apprenticeship starts had fallen by a fifth since 2015, with that decline especially hitting apprenticeships aimed at lower qualification levels and young people. Given the catastrophic impact of the Covid-19 pandemic on people’s ability to start apprenticeships and the widespread disruption to businesses, anything that helps employers to continue or start to offer apprenticeships again is positive.

Apprenticeships and economic recovery

However, the funding announced is but a fraction of what is needed. Prior to the chancellor’s statement, the Institute for Public Policy Research think tank proposed that the government should provide substantial additional funds to the apprenticeship budget to increase access to training for non-levy paying employers, and fully subsidise the wages of young apprentices for the first six months. In all, the new incentives amount to a fraction of the £1.9 billion this research indicated would be needed to ensure there are sufficient apprenticeships available to young people.

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This matters deeply because apprenticeships, when skilfully embedded by an employer and delivered with high-quality training, have transformational potential for two of the groups hardest hit by the pandemic - young people and those in low-paid work.

With what is likely to be the largest recession since the Great Depression, research indicates that without government intervention, youth unemployment could reach the highest levels on record. And while apprenticeships can only ever be part of the solution to this, we know that they are a sure way of boosting skills, driving career progression and improving future earnings.

Experience from previous recessions tells us that demand for apprenticeships will likely increase in the coming months, both from young people seeking a route into the workplace, and from those displaced from sectors struggling in the Covid-19 aftermath.

And that is why the gaps in the government’s apprenticeship support for businesses are so disappointing.

The challenges for small businesses in accessing funding for the training element of apprenticeships are not new and have been highlighted many times in Tes and elsewhere. Yet in the chancellor’s statement, nothing was announced to remove these persistent barriers. I fear this will continue to severely limit the number of smaller businesses offering apprenticeships and making use of the incentives on offer.

The ability of apprenticeship providers to reserve their co-investment funds and the lifting of the cap on funds per employer from three to 10 this week are both steps in the right direction. But the fact remains that accessing training funded via the co-investment route is still full of logistical obstacles.

Reskilling workers

That’s why the Reskilling the Recovery fund was launched. In recent weeks we have focused our efforts on building a sizeable levy transfer fund and making it available to small businesses in the capital to cover the full costs of apprenticeship training - bypassing the complications of co-investment altogether. Having launched in early June, we announced this week that we have secured pledges of over £1.2 million in levy transfer from businesses including American Express, Amazon, Pearson and Willmott Dixon.

So, while it is disappointing that gaps exist in the government’s apprenticeship support, I hope Reskilling the Recovery will help to fill the gaps and enable smaller businesses to afford the skills and training they need to recover from the impact of the pandemic.

The apprenticeships we support will offer crucial opportunities for young people to get into work and boost their skills, as well as helping to progress the careers of those in low-paid work who have been hit hardest by the economic impact of Covid-19.

Anna Ambrose is director of the London Progression Collaboration (LPC)