APPRENTICESHIPS 2 - ICS Learn · 2018-05-02 · APPRENTICESHIPS 2.0 Digital-first strategies to...

APPRENTICESHIPS 2.0Digital-first strategies to unlock the full potential of your people

APPRENTICESHIPS 2.0 Digital-first strategies to unlock the full potential of your people 2

INTRODUCTIONAsk any HR director these days what’s keeping them awake at nights, and you’re likely to hear some common themes: concern about Brexit, and the uncertainty it brings; the impact on jobs and roles of technologies like automation and artificial intelligence; and the rising cost of the minimum wage.

But there’s a good chance you might also hear a moan (or two) about the apprenticeship levy. Viewed by some employers as government interference in their learning and development activities, or simply a tax by another name, the apprenticeship levy and its purposes are widely misunderstood. However, perceptions held by employers and their HR directors about the levy will need to change if organisations are to unlock and exploit the huge potential of apprenticeships to boost future growth and success.

CONTEXTThe government must share a little of the blame: an ambitious target of three million people starting apprenticeships by 2020 was set in 2015 as part of a push to promote them as an alternative to university, helping to boost the economy by training people in the skills that employers need.

Yet progress has stalled, with official figures indicating that start rates actually fell back after the levy was introduced. The government’s own figures suggest that only 1.2 million new apprenticeships have begun since May 2015.

Nonetheless, there are several reasons why employers should take a second look at apprenticeships. While the concept may not be new – apprenticeships have been part of British industrial life for centuries – the focus on embedding them in workplaces has never been keener.

“Apprenticeships simplify the recruitment and training process while allowing you to develop new talent that will meet your business needs; they give your team new skills and energy while also giving a person a valuable career opportunity”Accountancy sector Source: ACCA

WHAT EMPLOYERS SAY


PROGRESSIVE ALTERNATIVEThe notion that apprenticeships are a second-best option, suitable only for young people deemed “not bright enough” to go on to A levels or university, is outdated. Today’s apprenticeships are a more positive, progressive option.

Today’s apprenticeships have changed from the stereotype – they are no longer just for more manual jobs, new starts or entry-level roles. While apprenticeships are still available for traditional technical and practical roles, they are increasingly considered a more attractive option to “earn and learn” by people who might previously have chosen a more academic route. There is growing recognition, for instance, among some young people (and their parents) that getting a university degree may not be worth the investment of racking up £30,000 to £40,000 in student debt. ➤

Apprentices add

£1.4 billion to the English economy*

“Our apprentices are so articulate and have great stories and narratives to share. They’re a success inside and outside the business”Banking sector Source: CIPD

WHAT EMPLOYERS SAY

* Source: CIPD, Apprenticeships that Work: A Guide for Employers, February 2017


PROGRESSIVE ALTERNATIVE cont’dMeanwhile, more than two-thirds of companies surveyed recently by the CBI employers’ group expressed concern about a shortage of suitable staff, as technological and other advances create jobs that demand higher skills – not to mention the possible impact of falling migrant labour post-Brexit.

In many sectors that were previously “apprentice-free zones”, such as advertising, engineering, HR, sales, accountancy, management and law, more employers are embracing apprenticeships as a means of attracting and upskilling the workers they need.

Thanks to the new apprenticeship rules, employers do not have to recruit to get the skills they need: they can upskill existing employees. With no upper age limit, plus eligibility for graduates, apprenticeships are now available for every age group in the workforce and most employees can find a course suitable to them.

While existing employees benefit from learning new skills to enhance their CVs, energised by the prospect of progressing their careers, employers typically benefit from employees who are more motivated, more committed to the company, more supportive of its objectives and more likely to boost the wider workplace culture.

Offering apprenticeships to existing employees affirms them as an integral part of the workforce. When employers invest in their staff, employees tend to see their job more as a career and are more likely to stay with the organisation for longer, which reduces staff turnover and recruitment costs.

By improving loyalty through apprenticeships, employers can maintain greater continuity within the workplace while simultaneously attracting new perspectives and ideas. Through spending time learning and studying their industry, employees on apprenticeships will bring fresh insights and best practice to their roles. ➤

“After we conducted some analysis, we took the view that organisations had to either treat the apprenticeship levy as a tax, or maximise the opportunity to do great training and development – (the latter) is what we’ve decided to do”Construction sector Source: CMI

WHAT EMPLOYERS SAY

There are apprentices in

170 industries, in

1,500 job roles, across

150,000 businesses in the UK*



PROGRESSIVE ALTERNATIVE cont’dApprenticeships now exist in some sectors for higher-level roles, enabling employers to plug managerial skill gaps as well as entry-level ones. In human resources, for example, there are apprenticeship standards for HR Business Partner/Consultant as well as HR Support. There is now even a Level 7 standard, suited to C-suite-level executives, which allows them to achieve an MBA.

This is good news for employers of all sizes. According to research released by the Association of Accounting Technicians (AAT), for example, 97% of small companies say they have found taking on apprentices to be good value for money. Apprentices have helped boost productivity at 90% of the firms questioned, and more than half said they now preferred to recruit apprentices rather than university graduates.

Apprenticeships also offer an alternative route for those who might previously have gone to college to learn subjects such as business, administration and customer service. They can also create valuable opportunities for people already in work to increase their knowledge, perform their current role more effectively, and open up more career options. Apprenticeships enable people to build up work experience, earn and gain relevant qualifications – as high as Master’s level – all at once.

97%

of small companies say they have found taking on apprentices to be good value for money*

Apprentices have helped to boost productivity at

90%

of firms questioned*



GOLDEN OPPORTUNITYThis new emphasis by government on apprenticeships is set to continue. From April 2018, new rules will allow large employers to share 10% of their apprenticeship-levy funding with companies in their supply chain. The CBI wants to go further: it is calling for employers to be allowed to pool more of their levy with others nearby, or in the same sector, and to combine with local colleges to create centres for excellence for apprenticeships.

Yet even supporters of the levy agree that the bureaucracy around the scheme has to be decluttered and that more must be done to promote the value of apprenticeships to employers, young people, their parents and careers advisors. “There probably wasn’t enough lead-in time for employers, and some were caught unawares,” says Sean McCready, apprenticeship leader at training provider ICS Learn. “There is also quite a bit of new bureaucracy that hasn’t been explained well. But I don’t see or hear any evidence of employers saying they don’t want apprenticeships.”

According to McCready, the apprenticeship levy is not a training tax to begrudge, but a golden opportunity to be seized. “It’s a chance for employers to think through their apprenticeship strategy, short term and long term, and plan for the skills that their business is going to need in years to come. One of the strengths of apprenticeships is that they allow organisations to easily integrate and mould someone new into their culture – apprentices also tend to show more loyalty to an employer who has invested time and money in them.”

90%

of employers say apprenticeships are a cost-effective way of building workforce skills*


80% of employers hiring apprentices have maintained or improved future skills in the business*


RULES RECAPFollowing the introduction of the apprenticeship levy in 2017, businesses with an annual wage bill of £3m or more must pay 0.5% of their payroll costs into a fund to pay for apprenticeship training. Not surprisingly, many large employers are keen to see a return on that investment, but the levy creates opportunities for smaller employers too.

Non-levy-paying employers can contribute 10% of the cost of training an apprentice, and the government will “co-invest” by paying the remaining 90%. Businesses with fewer than 50 employees don’t pay anything if they employ apprentices under the age of 19, and receive a £1,000 payment, with an additional £1,000 payment to the training provider.

Either way, the levy is creating demand for universities, colleges and training providers to translate academic, vocationally oriented qualifications into apprenticeships. The introduction of a register of apprenticeship training providers (RoATP) has quadrupled the number that can supply apprenticeship training to more than 2,500. Employers and employees now have greater choice and there is a wider range of provider types, able to respond to particular employer and employee needs.

APPRENTICESHIP LEVY FAQS

w How is the levy calculated? Businesses pay 0.5% of their wage bill, minus the £15,000 allowance. This then gets a 10% government top-up when they use the fund to pay a training provider.

w What can employers spend their levy on? They can use it to pay for the 20% required off-the-job training and assessment with RoATP-registered training providers and assessment centres.

w What can’t they spend it on? Apprenticeship salary, expenses, travel costs, management costs, or any other expenses except off-the-job training and assessment.

w What’s the first step they should take to start using their levy? Sign up for the Apprenticeships Service, which will allow them to manage and calculate their fund contribution, search for apprenticeship standards, and find and register training providers.

w Where can they find assistance? Most training providers will provide advice on setting up and managing the levy fund – consider choosing one that provides this end-to-end guidance.

76%

of employers say apprenticeships improved the quality of their product or services*

* Source: UK Government, Employer Guide to Apprenticeships, November 2017


DIGITAL-FIRSTThe delivery of these new apprenticeships has also changed to meet employers’ needs. The introduction of the levy has, for example, spawned a new generation of digital-first apprenticeships, which give employers and employees greater choice and flexibility than previously available while enabling them to access the learning with minimum disruption.

With the introduction of the apprenticeship levy, the Education and Skills Funding Agency also published a new set of funding rules for employers and providers in England. One of those rules requires employers to give all apprentices at least 20% of their total working hours for “off-the-job” learning. In the guidelines, this is defined as: “Learning which is undertaken outside of the normal day-to-day working environment and leads towards the achievement of an apprenticeship. This can include training that is delivered at the apprentice’s normal place of work but must not be delivered as part of their normal working duties.” ➤

“We started to notice a real ideas exchange between apprentices and more-experienced workers. After a while we were being approached by colleagues from our innovation team asking to meet our apprentices to gain insight and feedback from them – they were almost like consultants”Payments sector Source: CIPD

WHAT EMPLOYERS SAY


DIGITAL-FIRST cont’dFor some employers the idea of a key employee being away from their role 20% of the time is an obstacle. The common misconception is that the employee has to be off-site, in a classroom, once a week. With some apprenticeship training providers, this could still be the case. However, digital-first apprenticeships offer flexible, tailored, predominantly online delivery of that 20% off-the-job learning.

Approaches vary, but most digital-first apprenticeship providers adopt a blended learning approach, ensuring there’s a mix of virtual training, face-to-face visits and work-based projects alongside the classroom training. While the majority of the off-the-job learning takes place online, with peer-to-peer connection facilitated through live online classrooms, there will often be some in-person visits.

“What we mean by digital-first apprenticeships is harnessing technology to make the apprenticeship programme as flexible as possible for both employer and employee, while at the same time retaining the rigour, quality and robustness of the learning,” explains Sean McCready, who has more than 20 years’ experience pioneering the design and delivery of digital-first apprenticeships. He led some of the first online apprenticeships for the UK’s biggest employers, and specialises in using technology and online assessment to enhance the flexibility of apprenticeship programmes. ➤

“We want (to use apprenticeships) to provide a full suite of potential pathways, not just for external recruits, but also, excitingly, for internal staff to build their own capability and development”Public sector Source: CMI

WHAT EMPLOYERS SAY


66%

have experienced improved staff morale after hiring apprentices*


DIGITAL-FIRST cont’dMcCready adds: “What we hear from employers is that they don’t need or want us to be in the workplace all the time, so we connect with apprentices using video technology and live conferencing to ensure that we are as unintrusive as we can be and make the learning as flexible as possible.”

Using these kinds of digital tools throughout the apprenticeships means that learners are more likely to develop habits of self-reflection and evaluation that will benefit them throughout their career. Digital-first delivery also minimises interruptions to workflow by allowing apprentices to self-pace their online learning.

For employers, digital-first apprenticeships mean greater flexibility in terms of the training schedule, location of the learning and tutor visits. In short, digital-first apprenticeships are a highly flexible online learning format that allows employers and employees to shape the programme around their needs.

65%

of businesses have programmes aimed at attracting young talent*



CONCLUSIONFor levy-paying employers, there is an imperative to ensure a return on their investment now. However, the levy represents an opportunity for the HR function to contribute to driving their organisations forward.

Apprenticeships can be a catalyst for businesses to rethink and redesign their wider learning and development strategy to target skills gaps in their own organisations, as well as – from April – plugging critical skills gaps in their supply chains.

Used effectively, the levy presents an opportunity for forward-thinking businesses to upskill existing staff, employ fresh talent, maximise learning and development budgets and turn apprenticeships into a strategic advantage.

“The levy puts employers in control,” comments McCready. “It’s no longer the old system of training providers coming to employers offering free training paid for by the Skills Funding Agency or similar bodies. Instead, it’s employers’ own money, which gives them the control to design the apprenticeship standards and training programme to meet their needs. That’s a huge advantage that they didn’t have before.”

LEVY PITFALLS TO AVOID

1. Don’t let the money go to waste. “From May 2019 onward, the Treasury will begin recouping unused money paid into the apprenticeship levy,” explains ICS Learn apprenticeship leader Sean McCready. “There’s still time, but it’s critical that employers act now. However you choose to spend your levy, it really is an amazing opportunity.”

2. Don’t spend the money in an ad hoc fashion. “Don’t write off the apprenticeship levy as a tax deduction,” says McCready. “The levy gives you an opportunity to review the skills needed in your business and match your apprenticeship programme to meet the skills required, both now and in the future.”

3. Don’t sign up with a provider until you’ve completed thorough research. “There are a lot of different providers delivering the same standards, so it’s important that you work with your training provider to ensure they can not only provide the skills that you need, but also deliver it in a manner that supports the way your business operates.”

4. Don’t settle for an off-the-peg solution when you need a customised approach. “With the huge number of different learning methods and delivery models out there, ensure you talk with providers about how they teach their learners and see whether it fits with your company.”

ICS Learn partners with businesses to deliver and manage digital-first, RoATP-approved apprenticeships, fully funded by the levy. • HR Support Apprenticeship• HR Consultant/Partner Apprenticeship• Assistant Accountant Apprenticeship Their experts have 20+ years’ experience pioneering the first digitally-led apprenticeships for some of the UK’s biggest companies. Arrange a free in-house consultation:icslearn.co.uk/[email protected]

0333 363 8292

The digital-first apprenticeship levy solution

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APPRENTICESHIPS 2 - ICS Learn · 2018-05-02 · APPRENTICESHIPS 2.0 Digital-first strategies to...

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