Data published last month showed that just 14% of funds paid into the apprenticeship levy has been spent.
And with less than three months before the levy-payers’ funds begin to expire, it’s obvious it is not working and the Government’s target of 3 million apprenticeships looks like a pipe dream.
Starts overall in England have fallen by a quarter since 2015/16, with retail starts falling by a fifth in the same period. Nearly two years in, this simply isn’t good enough.
Retail is the largest private employer and is paying £160m to £180m per year. Despite this, the vast majority of retailers I speak to have spent no more than a quarter of their funds in the first year. Many are simply writing it off as a tax. It is the inflexibility of the system itself, the administrative burden that sits around it and a lack of any apparent desire by Government to act on the wider concerns raised by retailers.
As Retail Week reports week in week out, the industry is in the midst of a transformation. The apprenticeship levy, when announced, was regarded as an opportunity by many. It would put employers in the driving seat and ensure that training met the needs of a rapidly changing industry.
Apprenticeships can provide an entry route to work, enable existing staff to develop new skills and support those returning to the workplace after time away.
Everybody I speak to recognises our collective need to develop better jobs in retail - jobs that are more productive, have clearer progression routes and are higher paid. We need more analytical and digital skills at all levels. Apprenticeships should be part of the solution, not the problem.
Make it easier to use
We are not here because of lack of appetite. The commitment from the industry is clear to see – four new trailblazer standards have been developed, facilitated by Retail Trust, The Fashion Retail Academy and others, and there are more in the pipeline.
We have also worked with our members to offer two new retail apprenticeships, which are now available in the market.
But the Government must make the system easier to use and enable the levy to be used to cover some of the additional costs related to supporting an apprentice, such as the need to provide business cover for the apprentice’s role while they are doing their 20% required off-the-job training.
At a time when business costs are outpacing retail sales growth, it is a real concern that retailers are unable to draw down essential training funds they have already paid in
Government must also recognise that apprenticeships are not the only means of providing the in-work training that retailers need. For retailers with a large levy bill, vital learning and development budget has been diverted to cover levy costs.
At a time when business costs are outpacing retail sales growth, it is a real concern that retailers are unable to draw down essential training funds they have already paid in.
The joint review by HM Treasury and the Department for Education announced at last year’s Budget was welcomed by employers in retail and beyond. Our calls for additional flexibility looked like they might be answered.
But the pared-back commitment – a series of regional roundtables – has left many in our industry seriously doubting the Government’s commitment to fully engage.
It’s not just retailers, businesses across the economy have raised concerns. Training providers, big and small, are calling for greater flexibility.
If this Government is serious about its commitment in the Industrial Strategy to help people develop the skills needed for jobs of the future, they must work with industry to support in-work training, development and lifelong learning.
Retail provides more than three million jobs in every corner of the UK. We have an open invitation to Government to engage with our members and help us all improve the jobs of the future. Surely an offer that is worth taking up!