Making promises is the tried and tested way to win a leadership race. And in FE, there’s one promise that needs to be made – and kept. We need a commitment from our future prime minister to fully fund every level 2 and 3 apprenticeship started before the age of 18 outside of the apprenticeship levy.
There are losers and winners from the levy as it operates in England. Protecting all age groups and all sizes of employers is impossible – a balance must be struck between apprenticeships as a participation programme and an organisation-level productivity measure.
Despite fiscal headroom of £26 billion – dependent on a managed Brexit – post-16 education is in competition with pre-16 schooling as well as public services more generally. Relatively small spending commitments could have a better chance of passing the Treasury.
Just over half of apprentices aged 16-18 start the programme when they are 16 or 17. The Department for Education spent £745 million on 16-18 apprenticeships in 2017-18. Promising to fully fund level 2 and 3 apprenticeship starts before age 18 for both levy and non-levy payers would cost about £400 million.
Such funding protection outside the levy is clearly needed – once again DfE data shows another fall in apprenticeship participation at 16 and 17. At the end of 2018, less than 20,000 16-year-olds and 40,000 17-year-olds were apprentices in England.
More worryingly, the decrease in apprenticeship participation – 5.6 per cent at 16 and 4.8 per cent at 17 – year-on-year was greater than the fall in the age cohorts.
Apprenticeships: a decreasing pathway?
And so, the English apprenticeship system is set to enter the 2020s with only 3.3 per cent of 16-year-olds and 6.5 per cent of 17-year-olds. It’s hardly a mass apprenticeship system.
More than two-thirds of apprenticeships at 16 are level 2. Comparing the end of 2018 with the end of 2017, participation fell to 13,800. Participation at level 3 and higher fell to 6,100.
It’s clear that level 2 apprenticeships at age 16 are no longer a realistic alternative to a full-time classroom. And as participation on advanced apprenticeships at age 16 is equivalent to 1 per cent of the age cohort, young people are faced with a choice between T levels and A levels, not T levels and advanced apprenticeships.
A possible explanation could be that young people have decided to take jobs that attract a higher hourly minimum rate of pay (currently £4.35 per hour) rather than apprenticeship jobs (now £3.90 per hour).
But evidence for this isn’t overwhelming. Between the end of 2016 and 2018, the number of 16-year-olds on level 2 apprenticeships fell by 4,300. The fall, however, coincided with a decrease in non-apprenticeship jobs of 3,700.
Reducing employer demand
Before the levy, 25 per cent of apprenticeship starts were by 16- to 18-year-olds. Since April 2017, however, the proportion of commitments by levy payers to 16-18 apprenticeships has been 18.5 per cent, despite enhanced financial incentives being available.
In the new funding system, levy payers decide the age of apprentices to train and the level of apprenticeships to support. And it seems that level 2 and 3 apprenticeships for 16- and 17-year-olds are not their priority.
Contrary to early speculation, levy payers are spending the vast proportion of their payments. The first payment of levy by English employers was in May 2017, with £135 million collected. By May 2019, they had spent 91.8 per cent. If the trend continues, this could be bad news for 16- to 17-year-olds wanting an apprenticeship and the small firms wishing to train them.
Even so, the fall in apprenticeship participation by 16- to 17-year-olds – albeit from a very low base – cannot be blamed entirely on levy-paying employers.
Sectors that historically recruit apprentices at 16 and 17 – such as construction and hairdressing – do not have many levy-paying employers with pay bills in excess of £3 million. And as the FE world knows only too well, the shift from frameworks to standards – with some standards agreed and others rejected – is not helping.
By funding level 2 and 3 apprenticeship starts before the age of 18 and outside of the apprenticeship levy, the government will give 16- and 17-year-olds and their parents faith that the apprenticeship system is for them. And our political leaders will have the confidence to promise that apprenticeships do remain part of the strategy to ensure that every young person participates in education and training until their 18th birthday.
Mark Corney is a post-16 education and labour market consultant