The number of people embarking on apprenticeships fell by 35% in November 2017; the Department for Education registered just 27,000 apprenticeship starts, down from 41,600 in November 2016.
Changes to the Apprenticeship Levy have been widely blamed for the declining number of apprentices.
The UK wide Apprenticeship Levy came into force on 6 April 2017, requiring all UK public and private sector employers with an annual pay bill of £3 million or more to invest in apprenticeship training.
In May 2017, funding arrangements for apprenticeships changed with the aim of giving employers greater control over funding for apprenticeship training. However, many businesses argue that the changes have made the scheme confusing.
Brian Berry, Chief Executive of the FMB, said, “These are not finalised figures, but even allowing for a certain degree of change, this looks like a clear downward turn in new apprenticeships. Unfortunately, this is not altogether surprising given the intrinsic flaws in how the Apprenticeship Levy works.
“The lack of flexibility in the value of vouchers which large employers are able to pass down the supply chain to smaller subcontractors who work for them is a key issue. At present, only 10% of vouchers are able to be passed down, however larger construction firms do not tend to directly employ large numbers of on-site tradespeople. This means that there is a real danger that these vouchers are not being spent on training the key skills that the industry so desperately needs.
“In the long term, the only way we will be able to address the chronic skills crisis that is impacting the whole sector is by recruiting and training more new entrants. It is imperative that we make moves to iron out the flaws in the Apprenticeship Levy, given that more than two-thirds of small and medium-sized firms in construction are facing difficulties hiring bricklayers. This has increased by nearly 10% in just three months which demonstrates the swift worsening of an already dismal situation.”