In the ever-evolving landscape of education, apprenticeships stand as beacons of promise, offering a unique blend of hands-on learning and valuable experience.
CREDIT: This is an edited version of an article that originally appeared on DfE.
As school business leaders, understanding the intricacies of apprenticeship funding is vital to effectively allocate resources and nurture youth employment. So, let’s recap the world of apprenticeships, the apprenticeship levy, and its impact.
The apprenticeship levy
Created to empower the youth to earn while they learn, the apprenticeship levy is a catalyst for young minds to acquire the skills required for a fulfilling career. This innovative initiative enables businesses to embrace apprenticeships, simultaneously offering access to top-notch training for nurturing a skilled workforce. The apprenticeship levy is an intricate ecosystem, and here’s how it functions.
Who pays and how much?
The apprenticeship levy is shouldered by large employers with a hefty annual pay bill exceeding £3 million. Currently, only 2% of employers fall under this category, and they contribute 0.5% of their total annual pay bill as the levy.
These contributing employers receive their allocated levy funds in a dedicated digital account, earmarked for apprenticeship training. But here’s where the circle widens – the revenue generated through the levy doesn’t exclusively serve these large employers. Instead, it also sponsors apprenticeship training for other businesses eager to bring apprentices into their fold.
For the smaller players in the business arena, those with a modest annual pay bill less than £3 million, the scenario is different. They are liable for a mere 5% of their apprenticeship training costs, with the government covering the remaining expenses.
A world of apprenticeships
The beauty of the apprenticeship levy lies in its adaptability. The funds accumulated cater to nearly 650 diverse types of apprenticeships, each tailored to shape individuals for an array of careers. Whether it’s a degree apprenticeship in engineering or a GCSE-equivalent apprenticeship in social care work, the levy provides a tapestry of possibilities, allowing employers to embrace apprenticeships in a way that aligns with their unique needs.
Empowering youth
The majority of apprenticeship starters are young individuals under the age of 25, and 70% of these entrants begin at Level 2 and 3. To further fortify the appeal of apprenticeships among businesses and the younger generation, several initiatives have been set in motion.
Employers are relieved from paying employer national insurance contributions for apprentices under 25 who earn up to £4,189 per month.
A £1,000 incentive is offered to both employers and training providers when they onboard apprentices under 19 or those aged 19-24 with an Education, Health, and Care Plan or a history of being in care.
Small businesses, those with fewer than 50 employees, receive 100% funding for training costs when hiring apprentices under 19.
Commencing from August 2023, the bursary for apprentices aged 16-24 who are care leavers will see a substantial boost, soaring from £1,000 to £3,000.
In a continuous effort to make apprenticeships more accessible, young individuals will soon be able to utilize UCAS for searching and applying for apprenticeships, alongside traditional degrees. Moreover, the Apprenticeship Support & Knowledge programme (ASK) has been instrumental in promoting apprenticeships in schools and colleges, guiding over 2 million students on this transformative journey.
The ‘Get the Jump‘ campaign stands as a beacon, shedding light on the diverse educational and training avenues available post-16 and post-18, with apprenticeships at the forefront.
In this ever-evolving educational landscape, a firm grasp of apprenticeship funding not only benefits students but also reinforces a school’s reputation as a hub of progressive learning. With such knowledge, school business leaders can illuminate a path towards a prosperous and skilled workforce in the years to come.
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