New research by the Federation of Small Businesses (FSB) suggests that, with increased government support, small businesses could deliver an extra one million apprenticeships.
Published just before the release of the Apprenticeship Levy update, the FSB’s survey concluded that ‘the small business sector is crucial to the government achieving its target of 3 million apprenticeships by 2020’. Only 24% of FSB members currently employ an apprentice, but a further 24% would consider doing so if they’re given more support from the government.
The report states that if these results were replicated across the country’s 4.7 million small businesses, this could mean the potential creation of one million apprenticeship places – which would clearly go a long way to help the government reach its ambitious target for apprenticeship starts by 2020. What’s more, 2 in 3 small businesses retain their apprentice after the apprenticeship ends.
The FSB says that a ‘significant barrier to this growth’ is the plans for small businesses to contribute to the cost of training their apprentices, so calls on the government to offer a more generous incentive for small businesses than what’s been proposed so far.
It’s great news that small employers are increasingly taking on more apprentices, and that so many are enthusiastic about hiring an apprentice in the future. More opportunities to undertake apprenticeships can only be a good thing for young people who want to go down the vocational training route, especially in the small business sector. Small businesses make up the majority of UK businesses, and it’s great that they understand the value of taking on an apprentice and that it’s not just the larger, well-known companies that are willing to commit to this.
National chairman of the FSB, Mike Cherry, has called on the government to ‘hit the right balance between incentives and support’ at this ‘make-or-break moment’.
Mr Cherry recommends that ministers focus on more targeted and localised information for businesses with high growth potential, specific and practical guidance on how smaller companies can take on apprentices, and a more generous package of incentives and support for those that do. He comments that ‘getting this right is key to the successful reform of the apprenticeship system’.
The FSB’s recommendations suggest that the government should take a more active role in stimulating the local jobs and providing progression into high quality employment for learners. At the moment, there’s an expectation that providers must respond to the needs of their local labour market, but the quality and availability of local information is often poor.
Providing this information in a targeted way could help to create apprenticeships in sustainable areas for employment. ‘Specific and practical guidance’ for smaller companies would help to remove the bureaucratic barriers that may prevent many businesses from creating apprenticeships.
These are practical and focused suggestions and it’s important that apprenticeship opportunities are created by non-levy paying employers. The suggestion of a more generous package of support for small businesses is problematic for government. Levy paying employers already feel at a disadvantage, wages for apprentices continue to come under scrutiny alongside the living wage, and providers are feeling the effects of funding cuts. Unfortunately, it does seem unlikely that the government will find further financial incentives for employers in the current economic climate.
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