Fears for ‘lost generation’ as manufacturers snub apprentice scheme

Alan Tovey
·2-min read
Chancellor of the Exchequer Rishi Sunak (R) speaks to employees during a visit to the Worcester Bosch factory in Worcester, central England, on July 9, 2020 - Phil Noble/AFP
Chancellor of the Exchequer Rishi Sunak (R) speaks to employees during a visit to the Worcester Bosch factory in Worcester, central England, on July 9, 2020 - Phil Noble/AFP

A £2,000 taxpayer-funded incentive is failing to persuade employers to hire apprentices, sparking fresh fears over a “lost generation” of young workers as Covid wrecks jobs.

Just 12.5pc of businesses in the manufacturing and industrial sector - the traditional heartland of vocational training - said the Government cash influenced their decisions on whether or not to employ apprentices, according to research by trade group MakeUK.

Around 43.5pc of industrial companies said they planned to take on apprentices anyway, but the £2,000 on offer for each trainee under 25 had no impact on this decision.

This is the lowest level ever recorded by MakeUK, and way below the usual 75pc.

A further 44pc of employers said that they had no plans to recruit apprentices.

The £2,000 incentive - along with £1,500 for new apprentices older than 25 - was announced in July as the Government pledged that the training would be available to every young person who wanted one.

The findings come after the latest statistics from the Department for Education showed the number of people starting apprenticeships between March and July fell by 47pc compared with the same period a year ago, dropping to 53,530.

Younger people have been hardest hit by the pull back, according to provisional data for full academic year from August 2019 running to July 2020. It showed that just 23.7pc of apprenticeships were started by people aged 16 to 18 years and 29.5pc by those 19 to 24. Around 46.8pc went to those aged 25 or over.

And official data shows the growing unemployment crisis as a result of the pandemic is having the greatest effect on younger workers.

Verity Davidge, policy director at MakeUK, said: “These figures are a stark illustration of the heavy toll that the pandemic is taking on the potential careers of young people who are missing out on the valuable opportunities apprenticeships provide.

“For a sector that relies on them and, was already suffering from skills shortages, the impact on the talent pipeline in future years is also clear to see.”

Apprenticeships have been funded by a levy for more than three years which requires companies with an annual wage bill of £3m or more to contribute 0.5pc of their payroll cost in a fund for training.

The number of apprentices has fallen steadily from a peak of more than 500,000 in 2011-12, when the training was state funded.