According to a study by the UK think-tank Reform, millions of low-skilled workers are rebranding. Companies within the service industry have labelled its workers as apprentices and gaining access to government subsidies. Reform, in its report, continues to state that roughly 40% of these workers do not conform to the traditional standards.
The study encompasses the first year of the government’s decision to implement an apprenticeship levy on businesses. But weak distinctions of what an apprentice is and to what extent companies are exploiting the levy are assessed.
Training robbery? Or New growth prospects for workers?
According to the report, the levy operates as a means of generating taxable revenue while serving as a training stimulus.
“The levy itself is, in effect, a tax of 0.5 percent on the pay bill of organisations with annual wages of over £3 million. These organisations pay their levy contributions into a ‘digital account’ held by HMRC and can then ‘spend’ their contributions on apprenticeship training delivered by registered providers.”
The levy introduces a means for companies to access training software for their apprentices. Its goal is to reduce the shortfall in apprentice numbers over the last few years. But Reform has found that the first six months (April-October 2017) and continues into December.
While the policy was directed at providing ongoing training for under-25’s, Reform has found that Over-25s make up its largest demographic. This increase is also true of academic criteria for apprentices; with the bar being raised from Level 2 (GCSE-level) to senior/degree level 4-6.
New Apprentice System eroding the quality of workers?
Previous governmental targets set from 2015-2020 have impacted the underlying quality of apprenticeships according to Reform.
“The introduction of the levy has diminished the quality of apprenticeships. The list of roles now officially counted as an ‘apprenticeship’ includes many low-skill and often very short training courses, all of which can now be delivered using the funds generated by the levy.”
The reason the levy has been met with scrutiny is due to this disproportionate way in which it affects ages and groups other than those intended. This missed opportunity presents a danger to both those in the student population. As age ranges above them use these schemes to upskill however they can, leaving those younger at a disadvantage.
Additionally, the levy places real wages at risk, while providing no guarantee that those under the scheme will benefit from professional development.