How Labour’s Apprenticeship Reforms Will Impact Employers: Challenges and Opportunities

The UK’s apprenticeship system is undergoing a significant transformation under the new Labour government-proposed reforms. These changes aim to address the existing challenges and provide better support for apprentices and employers. With Labour believing that apprenticeship numbers have plummeted, skills shortages are widespread and the skills system in England is confusing for young people, adults, and employers

Some of the current challenges in the apprenticeship framework:

Funding issues

Many people and businesses found that the funding mechanism was overly complex.Which created barriers for employers to access apprenticeship programs and sometimes discouraged smaller businesses.

Employer engagement 

A lack of active engagement and support from employers, coupled with some administrative hurdles has hindered the effective implementation and uptakes of apprenticeships

Insights into the current apprenticeship landscape:

Participation and numbers 

In the 2022/23 academic year, there were 752,150 apprenticeship starts in England. However, sectors like construction have seen a decline in new apprentices, indicating a need for targeted interventions. With higher level apprenticeships are shown to be a favorite with learners with over three-quarters of apprenticeships started in 2022/23 being advanced or higher level.

Government initiatives

To encourage apprenticeship uptake, the government is now fully funding apprenticeships up to the age of 21 in smaller businesses. Additionally, they are updating the funding rules for 2024-25 to simplify processes for providers.

Ongoing challenges

Despite these efforts, some sectors may continue to experience skills shortages. Labour’s proposed reforms aim to address these issues by making the apprenticeship system more flexible and aligned with what each industry needs.

Labours proposed reforms; what employers need to know

Flexible growth and skills levy

Labour plans to transform the current apprenticeship levy into a “Growth and Skills” levy. This new system will allow you to use up to 50% of your levy funds for non-apprenticeship training. This flexibility will enable you to address a wider range of training needs, while the remaining 50% will still be allocated toward apprenticeships. Companies who do

Introduction of Skills England

Labour plans to establish ‘Skills England,’ an initiative designed to unite businesses, training providers, unions, and government bodies. This new organisation will work with the Migration Advisory Committee to ensure that training aligns with the needs of the labour market, directly impacting the quality and relevance of apprenticeships. Skills England will have a list of approved qualifications which businesses can spend their money on. This list would be created with the collaboration of businesses, authorities, unions, and wider experts.

The categories for these courses will include: modular courses such as digital and green skills as well as functional skills and pre-apprenticeship training 

Guaranteed Apprenticeships for Young People

 Labour’s commitment to providing access to apprenticeships or training for all 18 to 21-year-olds aims to reduce youth unemployment. This increase in available apprenticeships will create more opportunities for young talent to enter your business. The reforms include measures to expedite the approval of new apprenticeship courses. You can quickly introduce and adapt training programs to meet evolving industry standards and skill requirements.

Conclusion

Apprenticeships are here to stay, the proposed changes mean that apprenticeships will continue to exist perhaps on a larger scale than we’ve ever seen before. For businesses, this means greater flexibility in how you utilise your training funds. You’ll now have the chance to invest in a wider range of training courses beyond traditional apprenticeships, potentially improving workforce skills and driving growth. The new approach will also make it easier for you to address specific skill gaps and align training with your unique needs. Together, we can ensure that your chosen apprenticeship programmes not only fulfill current needs but also support long-term growth and success.

Take advantage of this change now and let us help you find the change you’ve been craving today!

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For further insights and guidance on maximising your apprenticeship funding, please don’t hesitate to reach out to us at:

Tel: 023 8017 0380

Email: hello@kiwieducation.co.uk

Kiwi & Yuzu Ltd is committed to empowering businesses and individuals through quality education, training, and skills development.