The AGR reveals what employers were thinking in the run up to The Apprenticeship Levy.

The Apprentice Levy has been around for nearly three months. This is the levy that around 2% of UK employers will have to pay if their salary bills are more than £3 million. Its aim is to boost productivity by investing in people. Young people. Those who are perhaps disenchanted with their studies. Those who just want to get on. Those young adults who know in their hearts university isn’t for them, but they aren’t done with learning either.

The AGR launched a report on the 26th June 2017, which was funded by the Higher Education Funding Council for England (HEFCE) entitled ‘Developing Degree Apprenticeships: the Employer Perspective’¹. It was designed to explore the various strategies employers of different sizes and sectors are carrying out. The survey consisted of 92 companies and was carried out in November 2016, so it demonstrates what employers were planning before the levy was introduced on 6th April 2017.

The headlines show that 44% of employers have accelerated their degree apprenticeship strategy in response to the levy (with only 22% saying they’d be cutting traditional graduate number intakes as a result).

And 56% are either offering, or planning to offer, one of the 18 approved degree apprenticeships available at the time of the survey – with employers with more than 5,000 employees being more than likely to do so, than smaller ones. The same can be said of employers in construction, financial services and the legal sector. 

The popularity of The Chartered Manager Degree Apprenticeship, which aims to professionalise employers’ future managers and leaders through a mix of work experience with degree-level university teaching, is predicted to grow between 2016 to 2019 by more than 400% to just over 1,000 apprenticeships. In the same period, employers are planning for growth of over 280% to 635 Digital & Technology Solutions Professional Degree Apprenticeships.

73% of employers stated that degree apprenticeships may be a part of solving the skills gap issue within their organisation. Only 13% did not see a clear link. The survey also asked employers whether their apprenticeship and social mobility strategy are linked, and 77% answered positively with only 5% of employers stating outright that recruiting apprentices will not contribute to their social mobility agenda.

And when asked what the main issues are facing employers when it comes to developing degree apprenticeships, 60% responded that there was a lack of awareness and 60% cited reputation, as well as 42% expressing unknown student demand as a concern.

It’s early days, but evidently employers are taking this seriously. Firstly, because they have to. But secondly, we’ve long since needed to guide this valuable pool of resource into a meaningful and productive direction. The coming years will soon reveal all.

Stephen Isherwood, Chief Executive of the AGR said: “Given how much financial and time investment goes into the development of a degree apprenticeship, employers are naturally concerned about being able to attract the talent they need to their programmes. However, the returns could be bountiful with an expectation that they could help reduce skills gaps and address social mobility challenges.

“To increase the range of degree apprenticeships offered we are calling for greater clarity on the creation and implementation of programmes and the development of their profile in schools. There is significant interest in the groups of employers developing apprenticeship standards, but the process of approval and getting to market has to be sped up.

“Degree apprenticeships will prove
 a success if enough are developed in key occupational areas, and employers and providers can work in partnership with flexibility on both sides. The future of early talent recruitment and development will look different, but degree apprenticeships are a long- term game and not a short-term fix.”


1 This research was conducted in November 2016 with AGR employers and received 92 responses. The data is supported by two round tables and multiple interviews to verify and bring context to the results. The report references and can be considered alongside the Universities UK report Degree apprenticeships: realising opportunities, which explores the supply side of degree apprenticeships.

Wednesday, 28 June 2017

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