Will government incentives provide the boost that apprenticeships need?

29 July 2020

Claire Gavaghan speaks with businesses to get their reaction to the latest government support on apprenticeships

The COVID-19 pandemic is the biggest threat the UK has faced in decades. March-May saw GDP fall by 19.1% (Office of National Statistics) and the UK’S Office for Budget Responsibility (OBR) suggests unemployment could reach 10%.


On 8th July, the Government took action and launched A Plan for Jobs 2020 to support the UK’s economic recovery.  The aim of the £30 billion plan is to support jobs by focussing on skills and young people, create jobs with investment in shovel-ready projects and greening our infrastructure, and protect jobs through financial support for the hospitality sector.


Key to this plan is support for apprenticeships which for many, are seen as the gold-standard in vocational training and provide opportunities to work, earn and learn for young people leaving school, as well as older workers to retrain and for employers, are valuable routes for nurturing future talent.


The Chancellor announced a number of employer incentives designed to boost apprenticeships, because COVID-19 has left many apprentices redundant and employers reluctant to recruit new staff. Employers will receive £2,000 for every apprentice aged 16-24 that they hire between August 2020 and January 2021. For apprentices aged over 25, employers will receive a bonus of £1,500. This is in addition to the current £1,000 bonus for hiring an apprentice aged 16-18. In order to encourage employers to retain apprentices, they can receive a bonus for every existing apprentice who returns to work from furlough and remain employed until January 2021.


So, will these incentives work as Rishi Sunak hoped?


Time will tell. Training providers and employers alike are trying to understand the new landscape for apprenticeships which is more complex than ever, with the launch of T levels and re-launch of Traineeships and what this will mean for them.


Analox, an SME from North Yorkshire, has recruited apprentices for many years in areas such as Development and Design and recognises the value they bring to the organisation. It is currently recruiting for a number of roles, including an apprenticeship in finance but other recruitment has been frozen due to the pandemic. As a company, it will be considering the Kick Start Scheme aimed at creating hundreds of thousands of high quality six-month work placements for people aged 16-24 who are on benefits and deemed to be at risk of long-term unemployment.


Nestle, based in York, is the biggest food and drink manufacturer in the world with an eight thousand strong workforce across the country. They employ around two hundred apprentices through over thirty different apprenticeship programmes, in sectors ranging from engineering and manufacturing to digital marketing and commercial.


Apprentices are integral to the business now and in the future. Nestle recognise that apprentices bring fresh thinking and energy which helps them to innovate and be competitive. There is no doubt that apprentices will be part of Nestle for many more years and they welcome the recent government initiatives designed to increase opportunities for apprentices across all businesses.


As Deputy Chair for York & North Yorkshire LEP’s  Skills and Employability Board, I fully support the mission to boost apprenticeships as a way of creating a greener, fairer, stronger economy in our region post COVID-19.


Our LEP’s Apprenticeship Strategy is specifically to support businesses to create more apprenticeship opportunities, improving the quality and relevance to the economy of apprenticeship provision and increasing the number of apprentices. This requires businesses to invest in training, not only their current staff, but in the future pipeline of talent that is readily available in North Yorkshire.


As well as traditional sectors of employment, the LEP’s Local Industrial Strategy sets out a plan where the transition to a digitally enabled, carbon negative, circular economy will assist businesses to flourish and people to realise their full potential. To achieve this step change, businesses will need access to a workforce that is technically skilled.  The ambitious vision to become England’s first carbon negative region by 2040 will require new skills for new ways of working and apprenticeships can be a mechanism for addressing the skills needed in this fast-moving, future-facing area of the economy.


Businesses of all sizes need to play their role in the future of North Yorkshire and its recovery. They can all benefit from leveraging apprenticeships to train their staff. We urge businesses to give serious consideration to apprenticeships as a way to support business growth and encourage them to make full use of the incentives offered by government to boost economic recovery.

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