The Changing Face of Apprenticeships June 2016 update Matt Creagh Trades Union Congress

Problems with quality Pay (1 in 7) Training Duration 5% of apprentices receive no training at all Duration 6% of level 2 and 3 apprenticeships are intended to last less than 12 months Despite the recently introduced requirement that Apprenticeships last a minimum of 12 months, for too many Apprentices, this is not the norm. 21% of 16-18 year olds still complete their apprenticeship in less than one year. Linked to future jobs? Genuine apprenticeships? Only 67% of apprentices are aware that they are undertaking an apprenticeship Only 38% of employers who offer apprenticeships (solely to existing staff) were aware that the training their staff were undertaking were apprenticeships Under Engineering Apprenticeship frameworks there were a total of 16,310 starts. However, it appears there were only 290 starts on Higher Level Apprenticeships in these frameworks in the years 2014/2015. The UKCES report flags up that there are 58,000 higher level engineering jobs needed by 2020.

Problems with equality and diversity In 2014-2015 just 61.9% (around three-fifths) of young black women successfully completed their training programmes, compared to more than two-thirds (66.4%) of Asian and (69.5%) white apprentices. Only 1% and 3% of Apprenticeship starts were by women (aged under 19) in construction and engineering, respectively. Skills Funding Agency (SFA) and Department for Business, Innovation and Skills (BIS) data published on Tuesday (April 5) showed that 23,800 employers posted vacancies from last August to March this year. That was just over 6 per cent down on 25,360 posted over the same period in 2014/15. Although there was a 20% increase in numbers of placements offered.

3m target for parliamentary period Latest figures Current projections for 2015/2016 (Aug15 - Jan16; 251,110 Apprenticeship starts) Employer numbers offering apprenticeships dropped by 6% to around 23,800 (but vacancies posted are up by 20% and applications are up by 3%) Completion rate of just 71.7% (nearly 1 million of proposed starts will not complete) 16-18 starts have increased by 7%, adult numbers have dropped 16-18 apprenticeships continue to be fully funded by the SFA Skills Funding Agency (SFA) and Department for Business, Innovation and Skills (BIS) data published on Tuesday (April 5) showed that 23,800 employers posted vacancies from last August to March this year. That was just over 6 per cent down on 25,360 posted over the same period in 2014/15. Although there was a 20% increase in numbers of placements offered. https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/513851/SFR_commentary_March_2016_QAR_Update.pdf

The Levy The govt will start collecting the levy in April 2017. Employers will pay the levy at a rate of 0.5% of payroll from the point where their payroll exceeds £3 million. Public and private sector 2% of employers to pay the levy, around 30,000 2020 – £2.9bn raised (£2.5bn England, 400k to devolved nations) 10% top up payment Only levy paying employers will have access to levy funds and the new DAS (from 2017 – how long?) BIS has calculated that there has been a steep decline in off-the job training during this period, with the number of employees attending training courses away from the workplace declining from 141,000 in 1995 to 18,000 in 2014. This analysis is corroborated by a recent authoritative academic study estimating that the total volume of training provided by UK employers fell by around a half (-48%) between 1997 and 2012. The TUC is also concerned that unscrupulous employers may seek to change the employment status of their workforce to avoid the levy charge. For example, if the “employee” payroll exceeds £3m then organisations will face a levy payment. Employers may seek to employ workers on temporary contracts, agency contracts or zero hour contracts to limit their levy liability. There is evidence of companies such as Sports Direct employing large numbers of staff on zero hours contracts to avoid employment law obligations.

The Institute for Apprenticeships Trade union involvement is key (CBI, EEF) Standards approval Monitoring quality – but how? Sectoral influence? BIS has calculated that there has been a steep decline in off-the job training during this period, with the number of employees attending training courses away from the workplace declining from 141,000 in 1995 to 18,000 in 2014. This analysis is corroborated by a recent authoritative academic study estimating that the total volume of training provided by UK employers fell by around a half (-48%) between 1997 and 2012. The TUC is also concerned that unscrupulous employers may seek to change the employment status of their workforce to avoid the levy charge. For example, if the “employee” payroll exceeds £3m then organisations will face a levy payment. Employers may seek to employ workers on temporary contracts, agency contracts or zero hour contracts to limit their levy liability. There is evidence of companies such as Sports Direct employing large numbers of staff on zero hours contracts to avoid employment law obligations.

Public Sector Apprenticeship Targets Public bodies that have 250 or more employees will be required to report on how they are meeting an apprenticeship target of 2.3% of the workforce Frameworks available? Job replacement a real issue, Cabinet Office paper Drive towards low quality, RCM joint union paper September 2016 start? As the bill is enacted

Preventing the misuse of the term apprenticeship Apprenticeships will be given the same legal treatment as degrees and the term “apprenticeship” will be protected by law, to prevent it being misused. The term will be protected in the Enterprise Bill, allowing the Government to take action if it is misused by training providers. Only applies to training providers Max £5k fine Skills Funding Agency (SFA) and Department for Business, Innovation and Skills (BIS) data published on Tuesday (April 5) showed that 23,800 employers posted vacancies from last August to March this year. That was just over 6 per cent down on 25,360 posted over the same period in 2014/15. Although there was a 20% increase in numbers of placements offered.

Trailblazers 129 standards have been published as of August 2015, of which 45 are Higher and Degree Apprenticeships. More than 220 new standards are in development 0.4% of apprenticeship starts are being delivered under the frameworks Transition from “frameworks” to “standards” has been delayed from 2017 to a later date

Adult Skills and FE The overall FE funding picture and likely impact of Local Area Reviews Expansion of FE Loans and limited government subsidies for adult upskilling Forthcoming devolution of the Adult Skills Budget (19 years+ excluding apprenticeships) The continuing decline of UKCES, SSCs and Industrial Partnerships