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Research shows businesses need more advice on apprenticeship funding


Six months from the introduction of the Apprenticeship Levy, businesses need more support about how best to use apprenticeships funding, according to a North East England Chamber of Commerce survey released on Friday.

The annual workforce survey found that over half (56%) of firms in the North East have no understanding of the Apprenticeship Levy or don’t know how their company will respond to it.

Businesses with a pay-bill of less than £3m fall under the levy threshold but can still apply for apprentice funding, yet the findings of the survey show that only 32% of all companies in the region have recruited apprentices in the past 12 months.

Paul Carbert, Chamber policy adviser said: “The current upheaval in the technical education and apprenticeship system will take time for firms to understand and adapt to. The government must ensure that businesses and training providers have certainty over the future direction of apprenticeships policy and funding, to allow them to invest in quality workforce training.”

Help is available for businesses that don’t fully understand the implications of the levy. Gateshead College has been working with Chamber members to support businesses on the changes brought about by the apprenticeship reforms so that they can make informed choices about their workforce development and invest their training budget wisely.

Ivan Jepson, Director of Business Development at Gateshead College, said: “The changes brought about by the apprenticeship levy are significant and more work is needed to help employers to understand the opportunities that the new system brings. Whether it be new recruits or upskilling the existing workforce, apprenticeships are a great way for businesses to develop the skills they need for the future. Although smaller firms don’t have to pay the levy they are still affected by the wider apprenticeship reforms, particularly the way in which this type of training is funded in the future. It’s therefore vital that SMEs are equipped with relevant information that can help them navigate the changes effectively.

“The survey results show that some larger levy-paying firms are still unsure about how best they should respond to the new legislation. We are continuing to work alongside businesses of all sizes to help them respond to the new challenges going forward.”

Most levy-paying businesses in the North East said they expected to recover all or part of their payment, with only 13% saying they didn’t expect to recover any of their payment.

The findings reinforce the need for clear guidance and support for businesses wanting to utilise the funding available for apprenticeships, particularly for SMEs.