AAT0073

Written evidence submitted by the Department for Business, Innovation and Skills and the Department for Education

Table of contents

INTRODUCTION

Overview of this memorandum

1. This memorandum provides the government’s evidence to inform the Committee’s inquiry into apprenticeships and traineeships for 16-19 year olds. For clarity, though covering ‘16 to 19 education’, we will refer to ‘16- to 18-year-olds’[1].

2. The memorandum consists of this introduction, which is designed to provide context for the Committee, followed by detailed evidence addressing each of the Committee’s lines of inquiry. Apprenticeships are available to people aged 16 and above, and traineeships to those aged 16-24. The memorandum presents evidence about each programme as a whole, but given the focus of the Committee, we have separated out data on 16- to 18-year-olds wherever possible. Annexes A-D provide supporting statistical evidence.

Introduction to apprenticeships

3. Apprenticeships are paid jobs with training that support individuals to become fully competent in an occupation. Evidence shows that apprenticeships have strong economic returns for individuals, for businesses and for government:

      Individuals with an advanced apprenticeship earn on average between £77,000 and £117,000 more than peers with comparable Level 3 qualifications[2], whilst those completing a higher apprenticeship can earn £150,000 more on average over their lifetime compared to those with Level 3 vocational qualifications[3].

      Of employers who take on an apprentice, 96% feel that their business has benefited[4] and 68% report an increase in productivity[5].

      The National Audit Office[6] has estimated that, for every pound invested in apprenticeships by government, the economy gets £18 back. When wider benefits are included, we estimate the return on investment to be even higher, at £28 for every pound of government investment[7].

4. Apprenticeships are available right across the economy, in 170 industries and over 1,500 job roles. In the 2012/13 academic year (AY), more than 220,000 workplaces employed an apprentice.. The Apprenticeship Grant for Employers (AGE) has supported over 83,000 young people (more than 53,000 of them aged under 19) to start an apprenticeship in a smaller business with less than 1,000 employees (see paragraph 4.4).

5. In the same academic year, 868,700 people participated in apprenticeships, including 181,300 aged under 19.

6. The government’s aim is for over two million people to have started an apprenticeship during the lifetime of this Parliament.

7. We have taken steps to increase the quality of apprenticeships, removing programme-led apprenticeships (which did not involve an employer from the start) and introducing a minimum duration for apprenticeship training. All apprenticeships must now be real, paid jobs that last for at least 12 months, and must involve meaningful training as well as the opportunity to study English and maths for young people who have not yet achieved GCSE grades A*-C in those subjects.

8. This has already had a direct impact on the number of high-quality apprenticeships. The number of ‘full apprenticeships’ (those that involve an employer from the start and have planned duration of at least 12 months) has more than trebled from 144,000 in AY 2009/10 to 475,900 in AY 2012/13, and for those aged under 19 the number has doubled from 53,600 to 110,900.

9. The greatest growth in apprenticeships has been at the higher levels. The number of advanced apprenticeships (equivalent to A levels) more than doubled between AY 2009/10 and AY 2012/13, while the number of people taking higher apprenticeships (equivalent to a bachelor’s or master’s degree) rose from 2,000 to 13,000 over the same period. The government has committed an extra £40 million over the next two years to support the delivery of 20,000 more higher apprenticeships, and a further £20 million to support employer investment in apprenticeships up to postgraduate level.

10. Doug Richard’s 2012 review[8], The Future of Apprenticeships in England, made a number of recommendations for how we could improve the government’s apprenticeships programme. In particular, he advocated that we should “put employers in the driving seat”; giving them the power to design new apprenticeship standards and control of apprenticeship funding to drive up quality and make apprenticeships fully responsive to the needs of business.

11. We have introduced reforms to the review’s recommendations. Giving employers the power to design apprenticeship standards will ensure that in future, apprenticeships deliver the skills, knowledge and behaviours that employers want in their future workforce. At the same time, we will route funding for apprenticeship training through employers, making them discerning and demanding customers of high-quality training for their employees.

12. Through our Trailblazer programme, more than 400 large and small employers (from PwC, Microsoft, John Lewis and BMW to small businesses like The Test Factory and Walter Smith Fine Foods) in 37 industries have already been directly involved in developing new apprenticeship standards for their industry. The first 51 employer-designed standards have been approved and published[9] in professions as diverse as Accounting Technician, Aerospace Fitter, Dental Laboratory Assistant, and Software Designer. The first apprenticeships are starting under the new standards in September 2014.

Introduction to traineeships

13. Apprenticeships are growing in popularity amongst young people – in AY 2013/14, there were over one million applications made by young people aged under 19 for vacancies posted on the Apprenticeship Vacancies online service (AV online), up by 16% on AY 2012/13[10]. In the context of our wider reforms to vocational education for 16- to 18-year-olds following Alison Wolf’s review[11], the government developed and introduced traineeships to help prepare young people aged 16-24 for apprenticeships and other sustainable employment.

14. Traineeships respond directly to employers’ concerns that many young people who apply for apprenticeships and other jobs lack the skills, qualifications, behaviours or experience they are looking for. Traineeships are an education and training programme with a core of work preparation training, English, maths, and work experience, designed to equip young people with the skills and experience they need to be able to gain an apprenticeship or sustainable job.

15. The traineeship programme complements other provision available to young people through Study Programmes, the Adult Skills Budget and Youth Contract that can also support them to progress into work or further learning.

16. The traineeship programme is off to a good start, with 5,400 16- to 18-year-olds joining the programme in the first three quarters of AY 2013/14. This could be an under-estimate of the total number of young people supported and final data on the numbers supported in AY 2013/14 will be published in November 2014. In AY 2013/14 6,000 traineeships opportunities were advertised on AV online alone. AV online is just one way that prospective trainees can find traineeship opportunities. Other routes include Jobcentre Plus referrals, local education and training providers or career services.

17. We expect that the supply of and demand for traineeships will continue to grow year-on-year as the programme continues to become established. Work is underway to encourage more eligible providers to offer traineeships, and to scale-up provision during AY 2014/15 and beyond. Data published in September 2014[12] shows that nearly 60% of eligible providers (for 16- to 18-year-olds) intend to deliver during the coming academic year, which will have a positive impact on the number of traineeship opportunities.

Useful links to further information

      The government’s response and implementation plan following the Richard Review can be found at www.gov.uk/government/consultations/future-of-apprenticeships-in-england-richard-review-next-steps

      The latest information about apprenticeship Trailblazers can be found at: www.gov.uk/government/publications/future-of-apprenticeships-in-england-guidance-for-trailblazers

      The approved and published standards designed by employers can be found at: www.apprenticeships.org.uk/standards

      Information about the current Get In. Go Far. communications campaign about apprenticeships can be found at: www.apprenticeships.gov.uk

      Further information about traineeships can be found at www.gov.uk/government/collections/traineeships-programme

      Statistics on apprenticeships and traineeships can be found at: www.gov.uk/government/publications/learner-participation-outcomes-and-level-of-highest-qualification-held

1. THE EFFECTIVENESS OF APPRENTICESHIPS FOR 16- TO 18-YEAR-OLDS, INCLUDING IN TERMS OF MEETING EMPLOYER NEEDS IN VARIOUS SECTORS, AND PROVIDING YOUNG PEOPLE WITH A SOLID FOUNDATION FOR EMPLOYMENT IN GENERAL OR IN PARTICULAR OCCUPATIONS, OR FOR FURTHER STUDY

1.1              The evidence suggests that apprenticeships for 16- to 18-year-olds present valuable opportunities for both young people and employers. Through our reforms, we want to increase further the effectiveness of apprenticeships by empowering employers to work together to set the standard for their occupations and sectors.

Effectiveness for young people

1.2              The evidence shows that young people find apprenticeships to be effective in preparing them for their future careers. Survey data from 16- to 18-year-old apprentices[13] showed:

      95% said they were more confident in their ability to do their job;

      88% had a better idea about what they wanted to do in life; and

      83% said they were more likely to undertake further study.

1.3              The positive impacts for apprentices continue to be reported in the medium term (one to three years later). Those who were aged 16- to 18-years-old at the start of their apprenticeship say they have gained valuable, transferable skills:

      89% said the skills and knowledge gained as part of the apprenticeship could be used across a range of jobs and industries;

      87% say their career prospects have improved; and

      68% say their literacy has improved, and the same proportion said the same about their numeracy.

1.4              These translate into strong evidence that apprentices under 19 are likely to report a promotion or greater responsibilities in the one to three years after completing their apprenticeship (even when compared to older apprentices – the average for the whole programme is in brackets):

      81% said they had taken on more responsibilities (average 74%);

      45% said they had been promoted (average 43%); and

      40% said they had done a further qualification (average 36%).

1.5              All age apprenticeships data shows that those with an intermediate level apprenticeship earn, on average, between £48,000 and £74,000 more over their lifetime than similar individuals with Level 1 or 2 qualifications, and those with an advanced level apprenticeship earn on average between £77,000 and £117,000[14] more than similar individuals with Level 3 qualifications. Higher apprentices could earn £150,000 more on average over their lifetime compared to those with Level 3 vocational qualifications[15].

Effectiveness for employers

1.6              We use survey data from employers to judge whether apprenticeships are meeting their needs. The latest research[16] shows that satisfaction is high amongst those employers involved in offering apprenticeships – 84% of employers surveyed were satisfied with apprenticeships and 60% were highly satisfied. When asked about the benefits of the programme:

      72% of employers said apprenticeships improved their product or service quality;

      68% said apprenticeships improved their productivity; and

      96% of employers report benefits to their business of hiring an apprentice.[17]

1.7              Evidence suggests that employers recoup their investment within one to two years, if they retain their apprentice[18]. Most importantly, apprenticeships support employers to build a pipeline of skilled staff for their organisation – two-thirds of apprentices keep working in the same organisation after their apprenticeship is complete.

1.8              Qualitative research suggests that employers who take young people on tend to do so as a way to ‘grow their own’, training them in ways specific to their company in order to maximise their impact on the business. While 16- to 18-year-olds may require more initial training, these businesses feel that they benefit from the enthusiasm and fresh ideas that they bring. Doug Richard summarised the position in his review:

“It is in the employers’ interest because apprenticed employees provide

benefits: they are more loyal and more effective. They understand their

employers’ business on a deeper level as they have grown up within it. They

are more loyal to their employer because their own self-worth is tied to the

quality of the employer whose training kite marks their accomplishment.”

1.9              Some sectors are more likely to take on 16- to 18-year-olds as apprentices. Those with the highest concentrations are:

   Construction;

   Engineering;

   Agriculture, horticulture and animal care; and

   IT.

Increasing effectiveness for both employers and young people

1.10              However, as the Richard Review recognised, there were some low-quality apprenticeships in the current system. Data from the 2011 Apprenticeship Pay Survey suggested that one in five apprentices did not receive on-the-job or off-the-job training, whilst in terms of duration:

“there is some evidence to suggest that the nature and extent of

training for apprenticeships is also changing. They appear to be

shorter duration on average with learners in 2011 reporting that almost

half of apprenticeships last a year or less”.[19]

1.11              We introduced measures to address these issues and increase the quality of apprenticeships. We adjusted the conditions of our funding for apprenticeships, including:

      removing programme-led apprenticeships and ensuring that all apprenticeships are paid jobs. All of the existing apprenticeships frameworks must include substantial learning both on and off the job;

      ensuring that all apprenticeships entail a rigorous period of new learning and the practice of new skills in the workplace. Since August 2012, all apprenticeships are expected to last between one and four years to reflect this;

      requiring all apprenticeship providers to support training in English and maths up to Level 2 for apprentices who have not already achieved this standard; and

      strengthening the Skills Funding Agency’s (SFA’s) safeguards on monitoring, reporting and subcontracting arrangements.

1.12              We want to go further to ensure that in the future apprenticeships are even more effective for employers:

“There is a need for greater employer involvement in the design and

implementation of apprenticeship schemes, in order to ensure that the

needs of their businesses are met” [20]

1.13              That is why, through our reforms, we are giving employers control over designing apprenticeship standards, setting out exactly the skills, knowledge and behaviour that they need to make apprentices highly effective members of their workforce. As David Lynch, Head of Engineering at GSK, recognises:

“Through the trailblazer scheme we are able to build on our current programmes

and design higher apprenticeship schemes that are tailored to our needs and

match the rapidly changing nature of our business” [21]

2              THE RANGE OF APPRENTICESHIPS AND TRAINEESHIPS AVAILABLE TO YOUNG PEOPLE

2.1              Apprenticeships are already available in a wide range of occupations right across the economy. Our reforms are encouraging employers in even more sectors to come forward to design and deliver apprenticeships for their employees. Traineeships are a relatively new programme but there is already strong evidence of breadth in the opportunities available.

The range of apprenticeships

2.2              Apprenticeships are available in a wide range of sectors right across the economy. In August 2014, there were 328 apprenticeship Frameworks available, covering 170 industries and over 1,500 job roles. These cover an extensive range of skills levels and occupations such as broad as Dental Nursing, Graphic Design, Horticulture, Electric Vehicle Engineering, Advanced Photo Imaging and Advanced Creative & Digital Media.

2.3              Since 2011, we have encouraged in particular growth in the number of higher apprenticeships (Levels 4-7) available. Higher apprenticeship frameworks are now in place in sectors such as Accountancy (Level 4), Life Sciences (Level 5), and Broadcast Technology (Level 6). They are available at a range of levels: at Levels 4-5 (the equivalent of a foundation degree), Level 6 (the equivalent of a bachelor’s degree), and even Level 7 (master’s degree) in some sectors.

2.4              Full data on apprenticeships by level and sector is set out in Annex A.

Increasing the range of apprenticeships

2.5              We recognise that the current breadth of apprenticeships available is not widely enough understood and misconceptions continue to exist that apprenticeships are low level or focused in particular sectors of the economy. This is something that we are addressing directly through our current public communications campaign (paragraphs 7.2-7.5), which focuses on the stories of a number of apprentices (including higher apprentices) in sectors such as aerospace engineering, television production, software design, and tax consultancy. The campaign aims to help young people and parents understand the range and quality of apprenticeships that are now available.

2.6              There is also more to do to ensure that apprenticeships are relevant to and offered by employers in sectors right across the economy. Survey evidence shows that one third of employers who are not engaged in apprenticeships say that this is because they believe apprenticeships are not relevant to their work, whilst 43% felt that apprenticeship qualifications needed to be more relevant to business needs. Employers consistently tell us that being able to design apprenticeships themselves will make them more applicable and relevant to their sector:

“government should regulate the system to ensure standards are

upheld, but it should not determine the content – this must be done by

employers”[22]

2.7              We want to extend the range of apprenticeships still further by giving employers in a wide range of sectors, including areas where apprenticeships were not previously available, the opportunity to design programmes that meet their needs through our Trailblazer programme.

2.8              There are high levels of demand from employers to take part in our Trailblazer programme to design new apprenticeship standards, with over 400 employers and 37 sectors involved in the first two phases. A full list is set out in Annex D. As Lee Travis of Simply Biz Group, who have been involved in the Financial Services Trailblazer, puts it:

“The Trailblazer development process has proven to be an excellent method for creating a new style of apprenticeship, based on sector needs and employer requirements.

The Paraplanner plays a key role in financial planning, with increasing demand

from businesses right across the sector. This demand, plus the on-going need to

attract ‘new blood’ into our profession makes this an ideal path for entry and/or career development”[23]

The current range of traineeships

2.9              Traineeships should be driven by the need to develop a high quality programme, scaling up as experience grows. The programme is off to a good start, with 5,400 16- to 18-year-old traineeships starts in the first three quarters of AY 2013/14[24]. Based on provisional data from the first year of delivery, traineeship growth compares favourably to similar pre-employment programmes such as the Access to Apprenticeships programme.

2.10              In line with other FE provision, we intend to publish final figures for AY 2013/14 for the first time, in November 2014. This release will provide the most accurate picture of delivery, including the total number of traineeship starts for the first year (AY 2013/14).

2.11              The growth of the programme is dependent on the number of eligible young               people who wish to take up a traineeship, and the number of employers willing to offer work experience placements. These are brought together largely by training providers, though some employers have a direct contract with the SFA to deliver training themselves.

2.12              AV online provides one route through which many young people apply for a traineeship. AY 2013/14 data shows that 6,000 traineeship places were advertised in the first year (see Table 2 in Annex C), and there were 8,000 applications from young people. Amongst 16- to 18-year-olds, applications began modestly, with 270 in the first quarter of the academic year, and this figure had increased to a total of 3,740 by the end of 2013/14 (see Table 1 in Annex C). This shows that there is a healthy, and growing, demand for and supply of traineeship opportunities. This undercounts the number of places because opportunities can be advertised by other means too, depending on what               providers and employers consider most appropriate.

Range of employers engaged in traineeships

2.13              The willingness of employers to offer work placements, or to run traineeship               programmes, is key to the success of traineeships. To date, most providers have not reported problems in securing work placements from local employers, whilst a number of large employers have chosen to establish their own schemes. Provisional data shows that over 1,400 employer workplaces[25] have delivered traineeship starts so far. These include Barclays, who in March 2014 announced plans to offer 1,200 traineeships, and BT, who have provided 141 trainees, and have plans to expand in AY 2014/15.

2.14              Employers such as The National Grid, Everton Football Club, Rogers               Restoration, and Costain have pledged to create 5,000 traineeship opportunities over the coming years, funded by the Employer Ownership of Skills pilots[26]. Other household names, such as Virgin Media, Siemens, and the BBC are already delivering traineeships and plan to offer more places in AY 2014/15.

2.15              Data from the SFA on the range of industrial sectors that make up the 6,000 traineeship opportunities advertised on AV online in AY 2013/14 (see Table 2 in Annex C), shows a good spread across industry sectors. Health and Social Work is the most advertised occupational route with 930 vacancies. Other community, social and personal service activities, education, retail, and manufacturing sectors each offered over 500 opportunities.

Coverage of traineeship provision across England

2.16              To ensure the traineeship programme is a respected and high-quality               training route, to date we have limited traineeships delivery to providers who have achieved an Ofsted inspection grade of Outstanding or Good.

2.17              For 16- to 18-year-old traineeships this resulted in a very small number of local authorities without an eligible provider, but this has steadily improved               throughout the first year of delivery. We have seen a modest net increase and               the geographic spread of providers has improved, so the gaps in provision               have reduced.

2.18              The gaps have been primarily in urban conurbations where travel to learn patterns minimise the issue. In the event of demand emerging in a gap, the Education Funding Agency (EFA) and SFA will support efforts to ensure that suitable provision becomes available in that area. For example, by encouraging approved neighbouring providers to support other providers in their local delivery.

2.19              Data on the geographical spread of traineeships is planned for publication               after November 2014 once we have final data for the full AY 2013/14.

3                    Current levels of employer engagement in apprenticeships including in providing places or defining standards and setting assessment, and what further steps the Government could take to improve this

3.1             Apprenticeships are being offered in large and small employers throughout the country. Through our reforms, we are engaging employers directly to create new apprenticeship standards and assessment plans. More than 400 employers from 37 sectors are already involved and we will go further by involving more sectors and more employers in the design of standards over the coming years.

Employer engagement in existing apprenticeships

3.2             Data indicates that the number of employers offering apprenticeships is growing, with over 228,000 employer workplaces employing an apprentice in AY 2012/13. In the same year, 868,700 people were undertaking an apprenticeship – the highest recorded in modern history. This included 181,300 16- to 18-year-olds.

3.3             The evidence highlighted in paragraphs 1.6-1.8 shows that employer satisfaction with the programme is high, and that employers report significant benefits as a result of apprenticeships, including to their productivity.

3.4             Apprenticeships are real paid jobs, so the programme’s success depends upon its ability to engage employers and deliver what employers value. Our priority is to encourage more employers to offer high-quality apprenticeships. That means making it as simple as possible to recruit and employ an apprentice, and making sure that employers can get the tailored, high-quality training that their business needs. That is why we are:

      Providing additional support to smaller businesses to recruit their first apprentices through the AGE (paragraphs 4.4-4.6);

      Offering employers the opportunity, without charge, to advertise their apprenticeship vacancies through our online system at www.apprenticeships.org.uk; and

      Providing support to large and small employers through the SFA’s National Apprenticeships Service to help them understand the benefits of apprenticeships and offer apprenticeship opportunities.

Increasing employer engagement in existing apprenticeships

3.5             We recognise that we need to do more to ensure that employers are aware of the benefits of engaging with apprenticeships and this is at the heart of our work on apprenticeship communications. The most powerful messages come from fellow employers and we have reformed the Apprenticeship Ambassadors Network (AAN) to focus the enthusiasm of current apprenticeship employers on encouraging their peers to get involved in both apprenticeships and traineeships. Members of the network have a personal commitment to apprenticeships and traineeships, a high profile in their sector or area, and commit to undertaking a range of activities to promote the benefits of the programmes.

3.6             We want to take a similar approach for traineeships and have successfully secured a marketing exemption to the value of £1.5m from the Cabinet Office. This will be used to deliver a PR and marketing campaign that will raise awareness amongst young people and engage more employers in AY 2014/15.

3.7             During AY 2013/14, the National Apprenticeship Service contacted over 180,000 small businesses, leading to the creation of more than 1,200 new apprenticeship opportunities. Our current Get In. Go Far. communications campaign[27] features real apprentices from companies such as Google, Sky and BAE systems, showcasing these opportunities to parents, young people and employers. We will shortly commence a regional communications campaign aimed specifically at encouraging more small businesses to engage in apprenticeships. National Apprenticeship Week also provides an annual opportunity to encourage more employers to engage and in 2014 generated 20,000 commitments from employers to offer apprenticeships.

Increasing employer engagement through our reforms

3.8             The Employer Ownership Pilots (EOP) have provided an early opportunity for employers to take control of training and tell government how to best align its priorities alongside business investment to ensure the successful development of skills for those industries. Through the programme, employers such as Whitbread, GE Aviation and Timpson’s have been involved in developing high-quality apprenticeships in their sectors.

3.9             We are building on that early enthusiasm from employers through our wider programme of apprenticeship reforms. As set out above (paragraph 1.12), one of the key insights from Doug Richard’s review of apprenticeships was that, in order to make a step change in employer engagement, we need to give employers much greater control of setting the standards for apprenticeships in their sectors and occupations. In that way, employers will directly see the benefits of engaging with and delivering apprenticeships because they will match the skills, knowledge and behaviours they need for their future workforce.

3.10        We have already seen a growing demand for employer engagement in our Trailblazers, from eight sectors in Phase 1 (launched in October 2013), to 29 in Phase 2 (launched in March 2014), to more than 100 proposals for Phase 3.

3.11        This demonstrates how that our reform programme is gathering momentum and capturing the imagination and enthusiasm of employers in sectors across the country and the economy. The employers involved range from the largest such as PwC, Microsoft, John Lewis and BMW to small businesses like The Test Factory and Walter Smith Fine Foods. We have published a list of all of the employers involved in each Trailblazer project[28].

3.12        The employer groups in the first phase of Trailblazers have continued to work together to design their assessment plans. By describing how apprentices will be assessed, these employers are ensuring that apprentices can only be successful if they meet the rigorous standards they have designed. For the first time, this will include a synoptic assessment at the end of the apprenticeship, giving employers the opportunity to ensure that all successful apprentices are fully competent professionals.

“After successful completion apprentices should expect to be fully

competent to undertake the job role for which they have been

apprenticed and hold industry-recognised qualifications to evidence

that."[29]

3.13        The following case studies illustrate some of the work that has been done so far by the Trailblazers in developing their apprenticeship standards and assessment plans:

      Automotive – organisations, including BMW Group UK, EEF, Ford, GTA England, the Institution of Mechanical Engineers, Jaguar Land Rover, NFEC, Siemens, Toyota Manufacturing UK, and Vauxhall Motors, have worked together to develop a Mechatronics Maintenance Technician apprenticeship. This will train the individuals who mend and maintain the machinery in factories, helping to reduce repair times and directly increase productivity. The employers involved have worked hard to ensure that it is benchmarked against international competitors. The group are working collaboratively with three awarding organisations that have been commissioned to develop new assessment methods, including an end-test which will, for the first time, provide a single rigorous gateway for apprentices to complete their foundation phase. Completion of the apprenticeship will enable the apprentice to apply for Engineering Technician recognition with the relevant professional body.

      Financial Services – organisations, including Barclays, HSBC, Lloyds, RBS, and Santander, have worked together to design and develop the apprenticeship standard and assessment plan for a three- to four-year Relationship Manager (Banking) apprenticeship. This will provide young people entering banking with an alternative entry route to the graduate programme, but with a similar end point. The group is working with their professional bodies and, as an example of wider partnership working, a manager from another bank will be involved in the assessment of each apprentice to ensure consistency. The skills, knowledge and behaviours of the apprentice will be tested against a knowledge qualification supported by in-house performance management processes and final assessment that covers the breadth of the role.

Increasing employer engagement in traineeships

3.14               On behalf of BIS and DfE, the SFA has developed an employer engagement plan to increase the number of new employers engaged in apprenticeships and traineeships, and also increase the number and range of opportunities offered by our existing employer customers. This consists of:

      a target list of 600 large employers to engage with apprenticeships and traineeships;

      face-to-face relationships with over 350 large employers aiming to extend their engagement to include traineeships;

      a digital communications service reaching all large employer customers on our client relationship management database; and

      a small business-facing team operates a call centre service to drive up engagement in apprenticeships and traineeships.

3.15                      Recognising that non-engaged employers are more likely to be influenced by other employers in their sector, teams across the SFA are aiming to reach employers through intermediaries such as the Apprenticeship Ambassadors Network and the 12 Local Apprenticeship Ambassadors Networks. We are also developing partnership agreements with Local Enterprise Partnerships (LEPs), and through partnership agreements with trade associations and other bodies such as the CIPD and BITC.

3.16          In July 2014 we agreed a marketing exemption to the value of £1.2m with the Cabinet Office for a traineeship PR and marketing campaign delivered by the National Apprenticeship Service in the SFA. This will increase demand for the programme, focusing on recruiting more large employers. This activity should generate at least 1,800 high-quality ‘sales’ leads over the course of the campaign, which they estimate would equate to over 600 employers offering placements.

3.17          The apprenticeship campaign will focus on small businesses to ensure duplication is avoided, and the telesales team are briefed to cross-sell both apprenticeships and traineeships, so no opportunities will be lost by this market segmentation.

3.18              Separate funding will be used to raise awareness amongst young people, parents, and referral agencies, and drive up young people’s demand for apprenticeships. The apprenticeship campaign will raise the number of apprenticeship vacancy applicants, which in turn will ensure a good supply of young people who are identified as being more suitable for a traineeship.

4              The impact of recent changes to the funding of

apprenticeships and traineeships

4.1              The funding changes that we have made in the current apprenticeship system have helped to significantly drive up the quality of provision, and our AGE has supported more than 80,000 apprentice starts. Through our reforms, we will give employers control of apprenticeship funding to help make apprenticeships more rigorous and responsive to the needs of employers.

Impact of our funding changes on current apprenticeships

4.2              As set out in paragraph 1.11, we have tightened the rules on apprenticeship funding to ensure that all apprenticeships are high-quality. This included removing funding for programme-led apprenticeships, and introducing a minimum duration of 12 months for all apprenticeships from August 2012.

4.3              This has had a very significant impact on the makeup of the apprenticeships programme. As the number of shorter and programme-led apprenticeships has reduced, the number of longer and more substantial apprenticeships (‘full apprenticeships’) has risen, more than trebling for the programme as a whole over the last four years:

4.4                            We also recognised the need to do more to support smaller businesses to recruit apprentices. Our AGE provides grants of £1,500 per apprentice for up to ten new apprentices in businesses with fewer than 1,000 employees, who have not recruited an apprentice aged 16-24 in the last year.

4.5              Up to April 2014, the grant has supported 83,500 apprentices, 53,600 of whom are aged under 19.

4.6              In the 2014 Budget we announced an additional £85m in each of the 2014-15 and 2015-16 financial years (FY). This extends the availability of AGE to December 2015. For 2015-16, the eligibility criteria will focus specifically on businesses with fewer than 50 employees, and on their first five apprentice starts, helping to target the funding even more closely on the smallest businesses who most need this support.

Funding for traineeships

4.7              Traineeships are delivered by independent commercial and charitable               providers, Further Education colleges and by some employers. Funding for traineeships is via the EFA for 16- to 18-year-olds, and the SFA for 19- to 24-year-olds. These funding agencies are responsible for ensuring provision meets the requirements.

4.8              For AY 2013/14 and AY 2014/15, funding for traineeships is through existing funding systems for 16- to 18-year-olds’ learning and the Adult Skills Budget. Therefore, there has been no significant funding or regulatory reform required to introduce traineeships. This will have been less bureaucratic for providers and employers than introducing a new funding system for a single programme.

4.9              Stakeholder feedback from the first year of delivery suggested that we could               simplify and align the current 16-18 and 19-24 funding arrangements in future years. In response, the departments published a consultation on 19 June 2014 which offered a broad set of options and proposals for how traineeships funding should be allocated from AY 2015/16. These focused on: ensuring the funding arrangements drive positive outcomes for young people; achieving greater consistency in the way traineeships are funded for 16- to 18-year-olds and 19- to 24-year-olds; and ensuring providers have the flexibility to design high quality programmes.

4.10              We will publish the outcomes of the consultation in autumn 2014. We will               monitor the impact of any significant funding changes if they are brought in for AY 2015/16.

Testing our reforms to apprenticeship funding

4.11              We recognise that the current apprenticeships funding system is complex, with hundreds of rates for different frameworks and different funding levels depending on apprentice age and size of employer. With funding routed directly to providers, it also lacks transparency, with employers often having very little idea how much government money is being contributed to the training and assessment of their apprentices. This, combined with the fact that employers are not incentivised to contribute to the cost of the external training, means that they do not always seek out the best training.

I think it is right the government contributes to the cost of training and that it

should continue to do so. However, I think that the purchasing power for

training must lie firmly in the hands of employers. Employers are best placed

to judge the quality and relevance of training and demand the highest possible

standards from training organisations. To become real consumers of training,

employers should have control of government funding and, also, contribute

themselves to the cost of training.[30]

“By channelling funding directly to employers you hand them

purchasing power. They can take the money to a provider and ask,

‘what are you going to do for me?’”[31]

4.12              In order to implement our apprenticeship reforms, we want to make a reality of this proposal to give employers control over apprenticeship funding. Routing funding through employers will put them in the driving seat in terms of securing the most appropriate training will give employers a greater stake in guaranteeing that the training provision their apprentices receive is high quality.

4.13              We are trialling a new funding model with the Trailblazer standards in AY 2014/15[32]. The key elements of this are:

      a single government co-investment rate has been set at two thirds (67%) for all apprenticeships at all levels. This means that, for every £1 that an employer contributes to the external training and assessment costs of an apprentice, the government will pay £2;

      five Core Government Contribution (CGC) caps on the amount of core government funding which can be drawn down for each standard have been set at £18,000, £8,000, £6,000, £3,000 and £2,000; and

      the actual price agreed for training and assessment will be agreed between the employer and the provider and will vary depending on the employer’s needs and those of the apprentice(s).

4.14              In the trial funding model, three incentive payments, in addition to the core funding, will be available to employers subject to employer eligibility as follows:

        a payment when an apprentice successfully completes their apprenticeship, worth between £500 and £2,700 depending on which cap the standard fits under;

        a payment for small businesses (those with fewer than 50 employees), worth between £500 and £2,700 depending on which cap the standard fits under. This will be payable when the apprentice has been learning for three months, and is in recognition of the additional costs that small businesses can face when recruiting an apprentice; and

        a payment for any employer taking on a 16- to 18-year-old apprentice, worth between £600 and £5,400 depending on the cap. This payment is intended to reflect the fact that such apprentices will require a greater level of supervision, guidance, education and induction in the workplace. It will be payable in two parts – half after the apprentice has been in learning for three months and half after the apprentice has been in learning for twelve months.

4.15              Employers will be free to use the additional incentive payments as they wish to meet the broader costs of providing an apprenticeship, just as they are with the AGE. The new funding model is summarised in the following table:

4.16              Where identified as a learning gap for the apprentice of any age, the government will fully fund English and maths training at Level 1 and/or Level 2 at the rate of £471 per level and subject. This funding is outside the core government funding for a standard, but is part of the overall apprenticeship budget. Even after we introduce the mechanism for routing funding via employers, this funding will still be routed directly to the provider. £471 is the current fully-funded English/maths rate for 16- to 18-year-old apprentices.

4.17              Learning support funds are also available to support the apprentice where there are exceptional additional costs required to enable a particular learner to achieve their apprenticeship, for example if the learner is dyslexic.

4.18              The AY 2014/15 trial of the new funding model will only apply to new standards. We are developing the mechanism that we will use in future to fund apprenticeships. It is important to get this right, so we have consulted further on the preferred funding model and approach to payment. The consultation closed in May. All feedback, along with evidence from stakeholder discussions, published research and survey data will be considered before making a final decision on the payment approach. A response will be published in autumn 2014.

“Placing employers in control of the design, delivery and funding of apprenticeships is essential. Through the current reform programme, employers have demonstrated leadership, creating a set of rigorous standards for a wide variety of highly skilled occupations.

Control over funding would give us the opportunity to work directly with training providers and build relationships which allow us to design apprenticeships which are more relevant to the needs of the British economy.”[33]

5                    Whether the Government’s investment in apprenticeships represents value for money in terms of the future wage returns for young people and their employability

5.1              Apprenticeships improve business productivity and profitability and there is strong evidence that they lead to demonstrable wage and employability returns for young people. Through our reforms, we want to ensure that apprenticeships become even more closely aligned to the future needs of businesses.

Evidence on value for money and wage returns

5.2              Data analysis and research consistently suggest that individuals of all ages achieve substantial benefits from apprenticeships – especially in terms of enhancing lifetime earnings. One leading report concludes that:

      People of all ages who complete an intermediate apprenticeship earn, on average, between £48,000 and £74,000 more over their lifetime than similar individuals with Level 1 or other Level 2 qualifications. Those with an advanced apprenticeship earn on average between £77,000 and £117,000 more over their lifetime compared to those with Level 2 qualifications. (London Economics, 2011a[34]).

5.3              Reports using a range of different methodologies also point to positive value for money and wage returns. These include:

      London Economics (2011a) suggests that those with an intermediate apprenticeship earn 12% more in employment than similar individuals with Level 1 or other Level 2 qualifications, and are 10% more likely to be employed. Those with an advanced apprenticeship earn 22% more in employment than those with Level 2 qualifications, and are 14% more likely to be employed.

      Using different data and a different methodology, London Economics (2011b)[35] suggests that those who achieve an advanced apprenticeship earn 12% more in employment than those who start but do not achieve their apprenticeship, and are 5% more likely to be employed. The equivalent figures for an advanced apprenticeship are 17% and 5% respectively.

      In surveys, individuals also report a range of benefits from apprenticeships – including increased skills/knowledge related to their work area (87%), more responsibility (74%) and a promotion or pay rise (with 40% getting either or both of these)[36].

5.4              All of this data is based on apprenticeships undertaken at all ages as it is not possible to split out in the samples evidence relating just to 16- to 18-year-olds. However, wider evidence suggests that qualifications undertaken at younger ages deliver greater benefits than those taken at older ages, which suggests that the benefits are likely to be even higher, on average, for younger apprentices (e.g. London Economics, 2011a).
 

5.5              There are also benefits to employers and the wider economy:

      Employers also report a range of benefits from apprenticeships, including competitiveness (77%), productivity (76%), reduced staff turnover (80%), filling vacancies (66%) and lower overall training costs (59%)[37]. Research indicates that they generally recoup their initial investment within one to two years of the completion of training[38].

      Taken together, this implies strong economic benefits to apprenticeships – with the NAO suggesting returns of £18 per pound of government investment[39]; the department’s research suggests even higher returns at £28 per government pound[40].

      Research[41] also suggests that government funding generates learning (and learning outcomes) which would not have occurred in its absence – with one study suggesting that only 30% of apprentices would have received some training in the absence of government-funded apprenticeships – and this training would not necessarily be as stretching or high-quality. This evidence therefore suggests low deadweight.
 

The future impact of our reforms

5.6              Whilst it is far too early to tell the impact of our reforms on future wage returns and employability, our aim is that by giving employers control of setting the standards for apprenticeships in future, they will be able to focus much more tightly on the skills, knowledge and behaviour that they need in their future workforce. This should mean that young people who successfully complete have an even greater opportunity to demonstrate the competence they need for success in their future careers. As Jez Brooks, Professional Development Manager at IBM and chair of the Digital Industries Trailblazer Group puts it:

              “IBM recognises the complexity and diversity of roles which apprentices could undertake in the digital industry, and the importance of having robust, clear standards for how apprentices will develop their skills, competence and capability. This is why we have been involved with the Trailblazer process from the outset.”[42]

6                    How the Government could encourage businesses of all sizes and in all sectors to offer apprenticeships including fiscal, regulatory and other measures

6.1              Businesses of all sizes right across the economy offer apprenticeships, but we want to do more to encourage diverse employers to get involved, including by providing direct support and by reducing any red tape associated with offering an apprenticeship.

Employer engagement in the current apprenticeships programme

6.2             As set out in Section 3, there is good evidence of strong employer engagement in apprenticeships. Our most recent data shows that the majority of businesses employing an apprentice are small. In terms of individual workplace size, two-thirds of employers who had apprentices had less than 25 employees, with nearly a fifth (19%) having fewer than 5 employees. Looking at the size of the whole organisation[43] nearly half (48%) of apprentice employers are part of organisations with 1-24 employees, whilst nearly a third (31%) are part of organisations with more than 100 employees[44]. Businesses which have an apprentice are proportionally more likely to be in the medium or large size bands than the overall business population.

6.3              Recent data also shows that more than 228,000 workplaces employ an apprentice and this data is available at a regional and constituency level[45].

6.4              Such diversity demonstrates the success of the programme in engaging employers of different sizes, in different sectors and with different types of apprenticeship. We are taking a number of steps to continue to support the development of a diverse programme, as well as making this a particular focus of our reforms (paragraphs 2.7-2.8).

Fiscal measures

6.5              Government makes a considerable investment in apprenticeship training, spending £778m on 16-18 apprenticeships and £737m on 19+ apprenticeships for FY 2014-15. All 16-18 apprenticeships are fully funded and, from next January, the AGE will be entirely focused on employers with fewer than 50 employees.

6.6              For smaller businesses employing their first apprentices, we provide additional support through the AGE (paragraphs 4.4 – 4.6). Government also recognises the important role large business plays in the apprenticeship programme. There are currently 60 large businesses directly grant funded by the SFA. This enables businesses to operate large scale apprenticeship training programmes delivered internally whilst being quality-assured by Ofsted.

6.7              We are building on these important lessons as we take forward the apprenticeship reforms. In the funding model that we are trialling in AY 2014/15 (paragraphs 4.11- 4.18), there are specific financial incentives built in to support small businesses with fewer than 50 employees and those taking on an apprentice aged 16-18.

6.8              More broadly, government has put in place measures to support employers to take on more young people, including apprentices. From April 2015, the government will remove the requirement for employers to pay National Insurance contributions for young employees under the age of 21.

Reducing bureaucracy

6.9              We recognise that regulation, or perceived burden, can present a substantive barrier to participation. A CBI survey of 319 employers in 2012 reported that two-thirds of employers found that employment regulation was a burden on labour market competitiveness. However, this was already a significant reduction from the 81% who answered this question two years previously[46]. Whilst the UK ranked fifth in the World Economic Forum’s 2012 report on labour market efficiency, we recognise that there is more we can do to reduce bureaucracy within the system.

6.10              The current system of apprenticeships currently highly regulated. We are using the Deregulation Bill 2014 to amend the primary legislation covering apprenticeships (the Apprenticeships, Skills, Children and Learning Act 2009). Through the Bill we are removing a number of statutory roles and requirements in order to simplify the system and support better employer engagement. We are removing the restrictive Specification of Apprenticeship Standards for England (SASE) which employers have told us prevents innovation and flexibility within apprenticeships. The Bill will also remove the role of apprenticeship framework Issuing Authority; at present only these sector bodies can approve the content of apprenticeships. Under the new system employers will be able to work together to produce new standards that will really deliver the skills they need.

Additional support

6.11              We also recognise that, alongside the AGE, smaller businesses in particular can require additional support to engage in apprenticeships. The SFA’s small business team provides direct help to employers who are keen to engage with apprenticeships. This includes:

      one-to-one telephone supports via a single free phone number;

      an online enquiry form or web chat facility;

      simple guidance for businesses on their responsibilities available from a small business page on the www.apprenticeships.org.uk website; and

      an online search tool that employers can use to find local training providers using a set of criteria they choose.

6.12                            The SFA also runs the dedicated AV online system, which is designed to make it as easy as possible for employers to advertise for apprentices. In 2013/14 41,700 employers advertised over 166,000 vacancies[47]. The SFA is currently working with the Government Digital Service through an exemplar project to develop the AV apprenticeship recruitment system further[48]. The aim is that from April 2015 employers will be able to advertise directly on the site. Employers are involved in the development and testing of the new system to ensure that it is flexible and meets their needs.

7              What factors prevent more young people considering apprenticeships and how these could be overCOME?

7.1             We recognise that there are a number of key factors that can prevent more young people considering apprenticeships as a route to a successful career. In general, we categorise these under three headings:

      Misconceptions about apprenticeships and who undertakes them;

      Careers advice and awareness of the range of apprenticeships available and how to apply for them; and

      The need for more apprenticeship vacancies in a wider range of sectors to meet demand from young people.

Misconceptions about apprenticeship

7.2             We know that there are significant and on-going misconceptions about apprenticeships amongst young people and the people and organisations that influence them. These tend to focus on an outdated view of apprenticeship as primarily focused on manual and low level work. For instance, ICM depth tracking research shows that:

      27% of 14- to 16-year-olds think that apprenticeships are aimed at those who don’t well at school, compared to 23% of 17- to 18-year-olds and 17% of 19- to 24-year-olds.

      16% of 14- to 16-year-olds think that apprenticeships are only available for manual workers, compared to 10% of 17- to 18-year-olds and 8% of 19- to 24-year-olds.

7.3             This is in contrast to the reality on the ground where young people can now pursue apprenticeships across the majority of the economy including areas as diverse as accountancy, fashion and marketing, and increasingly gain higher level qualifications, including degrees, as part of their apprenticeship.

7.4             To tackle these misconceptions we have launched the Get In, Go Far communications campaign, to showcase the stories of real apprentices and help young people, parents and their influencers to understand what apprenticeships can offer. This campaign was launched in August 2014, using television, poster advertising and digital media to tell the story of seven apprentices from different respected firms. Early indications suggest that the campaign is proving very popular with (at 17 September) over 320,000 hits on the campaign video on YouTube.

7.5             In planning the campaign, our research showed that three key messages resonated most strongly with young people and their parents, which we are emphasising through the campaign:

      the variety of sectors in which apprenticeships are already available;

      the ‘blue chip’ companies already offering apprenticeships – some of those showcased include IBM, Google, ASOS and Airbus; and

      that apprenticeships can be at a high level and can include achieving a degree.

Careers guidance and support to apply

7.6             We recognise that young people need the right preparation if they are to successfully pursue and complete an apprenticeship. Devolving responsibility for careers guidance to schools and colleges was an important first step, and they are now legally required to secure independent careers guidance for 12- to 18- year-olds. Guidance secured under the duty must include information on the full range of education and training options, including apprenticeships and traineeships. But evidence from Ofsted and the Association of Colleges (AoC) shows there is more we can do to raise awareness amongst young people of apprenticeships and how to apply for them. Independent research was commissioned by the AoC in September 2011 to survey 500 14-year-olds on their knowledge of choices available to them at 16, this showed that only 7% of young people in schools were aware of apprenticeships as a possible route post-16. Our reforms aim to address this by bridging the gap between learning and work with employers playing a more active role in the provision of information and inspiration about the world of work. We have therefore published:

      The Inspiration Vision Statement[49], in September 2013, which calls on schools and colleges to work closely with employers to provide more inspiration and insights for young people to ensure they receive a real-world view of different careers and help them understand how the world of work is related to their learning and education;

      Revised Statutory Guidance on Careers Guidance and Inspiration for Schools[50], effective from the start of the 2014/15 academic year, which sets a clear framework for the provision of advice and guidance. The guidance emphasises the need to provide pupils with direct experience of the world of work and highlights the importance of pupils gaining the skills that employers must look for when hiring, such as maths and science qualifications. The statutory guidance is also clear that a range of employer interventions including mentoring, coaching, inspirational talks, workplace visits, work taster events and help with CV writing and job searches can help young people to develop the skills and attributes they need to enter the labour market.

7.7             Underpinning this, as set out in the careers guidance action plan[51], which responds to recommendations in Ofsted’s thematic review of careers guidance, we are also:

      Strengthening further destination measures to improve their quality and relevance to schools. The measures clearly indicate how successful a school or college has been at preparing its students to progress to an apprenticeship or other forms of education or training, or to secure work. This will highlight where schools and colleges have low rates of progression to apprenticeships;

      Increasing information on apprenticeships by providing a wide range of marketing materials and promoting apprenticeships through the National Apprenticeship Service and National Careers Service, and through face-to-face contact at the Skills show and through roadshows; and

      Reshaping the role of the National Careers Service from October 2014 to support schools and strengthen the importance of partnerships between schools, colleges and businesses to ensure their pupils have access to first-hand information on careers and opportunities.
 

7.8             Ofsted have committed to giving careers guidance a higher priority in school inspections and DfE will work with them to monitor carefully the impact of the statutory guidance and the wider improvements that government has put in place.

7.9             In addition, to improve the information and guidance young people receive from employers, schools and colleges about apprenticeships, the SFA undertakes a regular programme of activities to communicate with young people about apprenticeships and how to apply for them. This includes work through social media channels such as YouTube, Facebook and Twitter, and partnership work with other agencies such as National Careers Service, Jobcentre Plus and the Education and Employers Taskforce. E-shots are also sent to 8,000 careers advisors and teachers who have signed up for information on a monthly basis. National Apprenticeship Week 2014, an annual event, was a successful vehicle for continuing to raise awareness, with over 1,000 events held and more than 20,000 apprenticeships pledged by businesses.

7.10        Alongside careers guidance, we recognise that young people need to feel fully prepared to apply for an apprenticeship and this is discussed in more detail in section 8.

The need for more apprenticeship vacancies in more sectors

7.11              The biggest constraint on young people’s participation in apprenticeships is employers’ willingness to offer apprenticeship vacancies and recruit young people as demand from young people currently outstrips supply. We have set out in sections 2 and 3 the actions that we are taking forward to address this.

Apprentice pay

7.12              There is some anecdotal evidence that the lower apprenticeship rate of the National Minimum Wage may be a disincentive to some young people, and their parents, when considering apprenticeships. However, there is no hard evidence to support this. We follow the Low Pay Commission’s advice, and earlier in the year accepted their recommendation to increase the rate by 2%.

8              Whether young people are adequately prepared for apprenticehips and how that preparation should be improved.

8.1              Alison Wolf’s review of vocational education made clear that there is more to be done to improve the quality of vocational education for young people. Doug Richard’s review of apprenticeships also pointed to the need to do more to prepare young people for apprenticeships:

“Many of our younger learners have more to learn than an apprenticeship can

encompass; the path they need to travel will be longer. They must learn the

skills to be employable in the first instance. They may well pass through a

period of pre-apprenticeship training and effort; and it is my view that there is

a lot to gain from ensuring these individuals can undertake high quality pre-apprenticeship training”[52]

Traineeships

8.2              Traineeships were introduced in August 2013 as a high-quality pre-employment training route for motivated young people whose prior attainment and lack of experience would be likely prevent them from securing an apprenticeship or a sustainable job immediately. Unlike most further education provision, progression to an apprenticeship or other job is the primary objective for a trainee, rather than a qualification or participation. We have designed the programme based on national and international evidence so that trainees should emerge with the desirable attitudes, behaviours and skills that employers require.

8.3              In the past these young people would have received Foundation Learning or               Access to Apprenticeship provision. Neither of these programmes were of               consistently good quality, and Foundation Learning was not successful in               securing young people’s entrance to further training or employment[53].

8.4.              The latest Traineeships Framework for Delivery[54] was published in May 2014,               and sets out how traineeships should be delivered to ensure high-quality               provision. Providers have the freedom to tailor programmes in ways which               best engage and support individual trainees although these must contain three core elements:

      A period of work preparation training, focusing on areas like CV writing, interview preparation, job search and inter-personal skills.

      English and maths for those qualified below GCSE A*-C. These are seen as crucial qualifications that offer employability skills.

      A high-quality work experience placement with an employer to give the young person meaningful work experience, develop workplace skills, and provide an opportunity to prove themselves to a prospective employer.

8.5              Providers have the flexibility to integrate other support and training, such as               mentoring, careers guidance, vocational qualifications and job search support.               The length of the traineeship should also be tailored for the individual, but               should last a maximum of six months.

8.6              The eligibility criteria for traineeships are set out in the Traineeships Framework for Delivery[55]. These are intended to target young people who would otherwise not be able to secure entry to an apprenticeship or sustainable job without completing a traineeship. Traineeships are therefore restricted to young people aged 16-24[56], who:

      are not currently in a job and have little work experience, but who are focused on work or the prospect of it;

      are 16-19 and qualified below Level 3, or 19-24 and have not yet achieved a full Level 2; and

      providers and employers believe have a reasonable chance of being ready for employment or an apprenticeship within six months of engaging in a traineeship.

8.7              The work preparation training provided within a traineeship covers both the               skills that young people need to find and secure a job (such as job search               techniques, CV writing and interview skills) and the skills and attributes that               they need to sustain that job (such as planning, time-keeping, team working,               self-confidence, resilience and strength of character).

8.8              In the vast majority of traineeships, English and maths provision is being               delivered though functional skills qualifications, at Level 2 and Level 1. As               stepping stones to GCSE achievement, functional skills will continue to be               delivered as part of traineeships and will remain part of the apprenticeship               completion requirements to maintain alignment between the programmes.

8.9              Traineeships are also expected to be flexible and personalised enough to meet individual learning and development needs and/or apprenticeship or other employment opportunities they are likely to apply for. We know that               some providers are offering additional elements beyond the core content of the traineeships programme. This can include mentoring and coaching; careers guidance; accredited qualifications, e.g. ICT; and other personal skills such as money management.

8.10              Although progression data is not yet available, we have already seen some               excellent examples and successes; where a high proportion of young people               are securing apprenticeships and jobs as a result of their traineeship. Our intention is to publish data, subject to it being fit for purpose, in the November Statistical First Release, subject to the usual National Statistics protocols.

8.11              In November and December 2013 we conducted a series of provider visits to               gather feedback on the early experiences of delivering traineeships.               Qualitative intelligence indicates that providers and employers view               traineeships as a very positive step forward and we have the focus right on preparation for work rather than gaining qualifications. Young people were enthusiastic about what the traineeship programme offered them. These               visits and early feedback from other stakeholders informed refinements to the Framework for Delivery[57] published ahead of AY 2014/15. We plan further visits during 2014/15.

Enhanced Apprenticeship Vacancies online activity
 

8.12              An enhanced and personalised vacancy matching service was set up by the SFA’s AV online service to work with 16- to 18-year-olds who had submitted unsuccessful apprenticeship applications. By September 2013, 3,256 16- to 18-year-olds were supported into an apprenticeship through intensive support offered through AV online.

9              How the Government could encourage more young people to consider apprenticeships and Traineeships

9.1             The main activities that we are undertaking to encourage more young people to consider apprenticeships are set out above in Section 7. This section provides further information about joint work between government services and additional information about work to encourage more young people to consider traineeships.

Joint work between the National Apprenticeship Service, National Careers Service and National Citizen Service

9.2             In addition to this, since May 2012, the National Apprenticeship Service, National Careers Service and National Citizen Service have developed and implemented a joint approach to promote and provide information on what all of these services can offer to young people. This includes training, cascading key resources and relevant, accurate information to providers, creating effective links between the three service websites, and encouraging young people to engage in traineeships.

9.3             Future plans include the development of new sections on the National Careers Service website; a provider portal area with apprenticeship, traineeship, National Apprenticeship Service and National Careers Service content; and key messages, links, information, resources and materials to help providers to support the young people they are working with.

Career Crowd National School Tour

9.4             Led by Not Going To Uni, with close involvement from My Kinda Crowd, the Career Crowd National school tour provides information about the National Careers Service, apprenticeships and traineeships through the delivery of free, interactive, innovative, engaging career workshops to young people in years 11, 12, and 13, in over 900 secondary schools and sixth form colleges between January and December 2014. 50% of visited schools have responded to a feedback survey with 100% positive feedback.

Traineeships

9.5              Our long-term aim is to establish traineeships as the preferred pre-employment route for young people in the target group. However, it is expected to complement rather than replace other options, to ensure that              young people can make choices most relevant to their individual situation.

9.6              The population of young people who are not in employment, education or training (NEET) is diverse, and international evidence[58] shows that a single one-size-fits-all approach would not be appropriate. Therefore, traineeships are for a subset of 16- to 24-year-olds who are not yet ready for apprenticeships or other jobs. Typically, they will have with low qualification levels, little or no work experience, but the right motivation to enter employment. We are targeting them because evidence from employers demonstrates that lack of experience, poor ‘soft’ skills, and limited ability in literacy and numeracy are all barriers to employment. Traineeships are not intended for young people who are already prepared for work; or the ‘hardest to reach’ group who will need more intensive support to meet what are often multiple needs or for individuals who are not prepared to ‘go the extra mile’ in demonstrating their commitment to entering work or an apprenticeship. Whilst national statistics are collected on qualifications achieved, they are not collected on ‘softer’ skills and motivations, and for this reason it is currently not possible to estimate the proportion of the NEET group that would meet this criteria. The best proxies we have will be based on the rate of growth of the programme over the next few years, based as it will be on the increase in demand for traineeship places from young people that meet the eligibility criteria.

9.7              To inform the programme’s future development, we have commissioned an               independent evaluation of the traineeships programme that will seek the views and experiences of trainees as part of the evidence. Fieldwork is already underway, and we expect to publish the traineeship impact evaluation at the end of 2016.

9.8              We will work with EFA territorial teams to encourage providers to increase their provision to meet the projected demand in future years. However, we are interested first and foremost in ensuring that providers deliver high quality traineeship programmes which meet the needs of young people. While we wish to see more young people able to take up traineeship opportunities, we do not want this to be at the expense of the quality of the programme or their experience.

9.9              Based on learning from AY 2013/14 we have already introduced a number of               measures that will both improve the quality of traineeships and the flexibility               that providers have to design tailored programmes for individuals. We               published these policy refinements in the Framework for Delivery[59] ahead of AY 2014/15. The most significant will improve training providers’ ability to tailor provision for individuals, which should lead to more successful results for the trainee and the programme as a whole. We have:

      clarified the appropriate duration for work experience placements, introducing a flexible hours-based model (100-240 hour band parameters) – this ensures clear minimum standards while providing greater flexibility for providers;

      allowed providers up to four weeks to identify the lead employer for each trainee, so that they can match the individual to the most appropriate employer; and

      agreed that benefit claimants on traineeships will no longer have to do their work experience in a block of 6-8 consecutive weeks, allowing providers to tailor the approach to the individual.

9.10              We have also:

      allowed providers with an Ofsted grade Outstanding or Good who are currently under a Financial Notice from the EFA or SFA the option to request to deliver traineeships. These providers will be assessed by the funding agencies on a case-by-case basis; and

      permitted the EFA to apply greater flexibility to its in-year growth rules to address the issue some providers have raised about lagged funding for 16- to 18-year-olds that makes it difficult to grow their provision in-year.

9.11               As experience of delivery grows we expect to see more providers planning to               deliver traineeship programmes and existing providers scaling up their               provision, helping to encourage and meet demand from young people. Recently-published information from the EFA and SFA on 16-18 eligible providers shows that almost 60% of eligible providers have already signalled their intention to deliver traineeships in AY 2014/15 (470 out of a total of 798 eligible providers)[60].

Amending benefits rules to support young people into traineeships

9.12        Collaboration between government departments has enabled the relaxation of rules which providers reported had hindered personalisation of programmes. For example, trainees can now train for more than 16 hours per week while retaining Jobseekers Allowance and no longer have to undertake 6-8 weeks consecutive work experience. This allows more tailored approaches and was announced in the revised Framework.

9.13        The Department for Work and Pensions (DWP) have a planning assumption for the number of Jobseekers that could be               referred by Jobcentres by August 2015. DWP and the SFA are working together to support an increase in the number of traineeship referrals for those who are deemed suitable by Jobcentre work coaches.

Annex A: Apprenticeship comparison tables for participation, starts, success rates, sector and geography

Apprenticeship Participation by Level and Age (2009/10 to 2012/13 and 2013/14 August to April Provisional)

Notes

1) Figures are rounded to the nearest 100.

2) Age is based on age at the start of the academic year.

3) Percentages are based on pre-rounded data.

4) Full-year numbers are a count of the number of Apprentices that participated at any point during the year. Apprentices undertaking more than one course will appear only once in the Grand Total but will appear against each Level they participated in.

Apprenticeship Participation by Sector Subject Area and Age (2011/12 and 2012/13 2013/14)

Notes
1) Volumes are rounded to the nearest ten except for the Grand Totals which are rounded to the nearest hundred.

2) '-' Indicates a base value of less than five.

3) For definitions of variables used in the tables please see the data dictionary:

www.thedataservice.org.uk/datadictionary/

4) The data source for all tables is the Individualised Learner Record, except where stated.

5) In this table full-year numbers are a count of the number of Apprentices that participated at any point during the year. Apprentices undertaking more than one course will appear only once in the Grand Total but will appear against each Sector Subject Area they participated in.

Apprenticeship Programme Starts by Level and Age (2009/10 to 2012/13 and 2013/14 August to April Provisional)

Notes

1) Figures are rounded to the nearest 100.

2) Age is based on age at the start of the academic year.

3) Percentages are based on pre-rounded data.

Apprenticeship Framework Achievements by Level and Age (2009/10 to 2012/13 and 2013/14 August to April Provisional)

Source: Individualised Learner Record

Notes

1) Figures are rounded to the nearest 100.                           

2) Age is based on age at the start of the academic year.                           

3) Percentages are based on pre-rounded data.                           

4) '-' represents a base value of less than 5.                           

Apprenticeship Success Rates by Level and Age (2008/09 to 2012/13) – Percentages

Annex B: Data Tables from SFR: Participation in education, training and employment, age 16-18

All figures are drawn from the SFR, Participation in education, training and employment, age 16-18: www.gov.uk/government/statistics/participation-in-education-training-and-employment-age-16-to-18

The tables show number and proportions participating at a snapshot or census point at the end of the year. Note, this will impact on the perception of relative sizes of different forms of participation as snapshot full-time education is circa 95% of a full-year figure, but for work-based learning the snapshot is much less of the full-year total (perhaps around two-thirds).

There is some overlap between work-based learning and full- and part-time education (0.1% and 0.3% respectively at end 2013). The overlap is excluded from the first table (so numbers add up to the population).

The proportion of 16- to 18-year-olds in full-time education, and overall in any form of education and training, are at their highest level since consistent data begins in 1994.

The work-based learning includes apprenticeships, but also in the past schemes like Entry to Employment (E2E) and other work-related provision such as Basic Skills and Train to Gain.

Overall the proportion of 16- to 18-year-olds in work-based learning has been increasing year-on-year since 2010 (or 2009 if you just count apprenticeships); prior to that the proportion had shown annual falls for most years since 1994.

Annex C: Data on traineeship opportunities (2013/14)

The tables set out here provide information about the traineeship opportunities advertised through the AV website during 2013/14. They do not represent the sum total of all traineeship opportunities because some employers and providers will offer traineeships without advertising them through this website (which is a free online resource but not compulsory).

Table 1: Applications for traineeships using the AV system, by age at registration in 2013/14

Notes
1) Values of 5 and over have been rounded to the nearest 10.
2) Age represents a candidate’s age at registration.
3) 25+ includes those with no age.
4) Quarters are as follows: Quarter 1: Aug to Oct. Quarter 2: Nov to Jan. Quarter 3: Feb to Apr. Quarter 4: May to Jul
5) Candidates can change and correct their details at any time. Occasionally this can result in small changes to the historical data.
6) A Candidate’s activation is possible after registration date and that recent quarters may be revised as more up-to-date data is published.

7) This is not the sum total of traineeship opportunities. Other ways that prospective trainees can find traineeship opportunities is through Job Centre Plus referrals, local education and training provider or career services.

Source: www.gov.uk/government/uploads/system/uploads/attachment_data/file/350649/ApprenticeshipVacancyReportNumberofapplicationsbyAgeGenderEthnicityorSSAorProgrammeLevelSep14.xls

Table 2: Traineeship opportunities in 13/14 by broad industry sector

* Figures are rounded to the nearest 10, and do not sum to the total due to rounding

Note:

1. This is not the sum total of traineeship opportunities. Other ways that prospective trainees can find traineeship opportunities is through Job Centre referrals, local education and training providers or career services.

Source SFA analysis of aggregate AV data

September 2014

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