How the apprenticeship levy can generate a stronger skills base

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Written by Richard Hilton on 7 May 2019 in Features

Richard Hilton shares his thoughts on how businesses are missing out on the opportunity to boost their employee skill base through unclaimed apprenticeship levy funding.

Reading time: 3 minutes.

In March the UK celebrated the impact of apprenticeships on individuals, employers and the economy during National Apprenticeship Week 2019. This year, the focus theme was ‘Blaze a Trail’, both in terms of individuals firing up their careers and employers injecting new employees and skills into their organisations. 

However, while many businesses are providing great training and reaping the benefits that apprenticeships are bringing to the workplace, there are also thousands of companies missing out on the opportunity.

In April 2019, a predicted £3bn of untouched levy funding will begin to be absorbed by the UK government at a rate of £120m a month. These figures are based on a Freedom of Information Act request from The Open University that found employers have earned back just £480m (14%) of the total funding available since May 2017 when the scheme launched.

Employers now face very little time to take advantage of the levy but it’s critical they reassess learning and development initatives and invest in training to remain competitive and future proof their workforce.

Understanding what your workforce desires can be the key to future business growth.

Are you making the most of apprenticeships to ensure you have a strong skills base? Here are some of the many advantages to partaking in the levy:

Apprenticeships are economically sound

As you can draw the total value of your apprenticeship contributions through accredited training providers, there is an economic appeal to employers. Not only this, but the staff that are then trained will be improving your business from within.

Without the pressure of student debt and a sometimes challenging work/education balance for full-time University students that can interfere with learning, apprentices are free to focus on increasing their skills in a trusted environment that leverages their expertise as they learn.

Employees desire more training

Understanding what your workforce desires can be the key to future business growth. Harvard Business Review found that the potential to achieve career progression and higher future earnings was one of the top priorities for survey participants. For many, this will include the need for further training, which apprenticeships can offer, empowering workforces to reach their career potential. 

Re-train your existing workforce too

A huge benefit is the incredible variety of advanced managerial and technical professional skill training courses that are available through the levy that existing workforces can also take advantage of.


Higher and degree apprenticeships allow apprentices to gain university-level qualifications while working and offer the chance to gain valuable skills, higher earning potential and improved career choices. For an apprentice starting out, this means there is no limit to how high and how far one can go and for an existing employee it means they have the chance to re-train on the job.

Hold on to your talent

Organisations embarking on new apprenticeships schemes may feel a level of caution in terms of what the long-term benefit to the business may be. However, The National Apprenticeship Service reports that 69% of employers say that apprentices improved staff retention and that 65% of apprentices stay working for the company that trained them, which are lasting benefits.

It also found that almost two-thirds (73%) of employers reported staff morale had improved for various reasons including plugging skill requirements, increasing productivity and enabling senior staff to learn new skills such as mentoring.

Address productivity challenges

Productivity remains one of the UK’s biggest economic challenges. The latest figures from the Office for National Statistics (ONS) show that UK workers are 16.3% less productive than those in other G7 nations.

Using government funding can help plug the skills gap by freeing up and enabling highly skilled workers to perform tasks more efficiently. In fact, Barclays has said that apprentices contribute £18,000 of net productivity gains over the course of their programme, benefiting the individual, business and economy as a whole.

To help the government meet its apprenticeship targets it is imperative that organisations grab the opportunity to future-proof their business with homegrown talent now.


About the author

Richard Hilton is EMEA Managing Director of the Miller Heiman Group



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