This push to boost apprenticeship numbers will be funded by a new levy on businesses with a payroll of over £3 million, due to be introduced next month.
The levy is a dramatic change in the way in which apprenticeships are conceived, funded and delivered. Degree apprenticeships are the latest model within the new ‘higher apprenticeship’ standards, giving apprentices the opportunity via employer sponsorship to achieve a full bachelors or masters degree through flexible study arrangements while in work.
Major employers see the introduction of degree apprenticeships as an opportunity to grow their future workforce in collaboration with universities – boosting productivity, reducing churn and sharpening the skills of new talent. In turn, universities see the value of partnering with employers, to help address their region’s higher-level skills gap and explore long-term opportunities for knowledge transfer and research and development collaboration.
What is clear is that degree apprenticeships provide universities with new ways to work closely with businesses – both the 1.3 per cent of businesses who will be subject to the levy and the vast number of small and medium-sized enterprises that are not, but will be eligible for matched funding for degree training on a 90:10 per cent basis from the Skills Funding Agency. (Those with fewer than 50 employees will be eligible for 100 per cent funding.)
Meeting the skills gap
We see the opportunity as well as the challenge of delivering degree apprenticeships. Liverpool John Moores University was one of 18 projects to gain HEFCE funding last year for 200 degree apprenticeships, and is piloting the model within engineering and technology programmes and in policing studies where the skills gap is known.
This tactical approach seems appropriate at this early stage, so we can evolve our offer to meet future model and market demands. We have confidence in our approach, having taken a leading role in the Government’s Construction Employer Trailblazer initiative, developing and delivering 13 quantity surveying degree apprenticeships with eight companies, including three small or medium-sized enterprises.
But at this early stage, when the numbers of apprenticeship learners in higher education are few, universities and employers are still getting to grips with some challenges presented by this fresh model.
First, the level of demand from employers and learners. Will the trickle of students turning down full-time university places to take up jobs with a degree apprenticeship, quickly scale up?
Second, the level of available funding. How much of the new £2.5 billion apprenticeship funding pot generated by the levy will be new funding? The Government has not yet said, although it has been suggested that the Treasury sees the levy as replacement funding.
Third, models of delivery. Will employers wait five years to have their employees earn bachelors awards, in line with the typical part-time degree model, or will they want accelerated, block delivery of the new degree routes?
There are also longer term questions: Where could we be three years from now if, as some predict, the degree apprenticeship model becomes dominant in some subject areas but disruptive to others?
Will we see universities make tangible advantages of the levy in developing stronger ties to business? One feature of this could be a workforce development partnership model with some universities positioning themselves as the university partner of choice for higher-level workforce skills development.
Now the Government has returned universities to the Department of Education, how will policy-makers lever workforce development requirements of business and university skills provision into closer marriage? Will the Apprenticeship Levy provide one such calling card?
Whatever the challenges, it is an exciting time for universities to forge and strengthen partnerships with industry, and to transfer our advanced skills and knowledge, by empowering students with the latest innovative techniques and methodologies.
This will enable universities like Liverpool John Moores University to play an active role with and for employers, to enable industry to be more competitive and innovative, and to grasp the opportunities that Industrial Strategy and the Northern Powerhouse offer.