Although the coalition government claims that apprenticeships generate a £40 return for the economy for each £1 of investment, two thirds of employers do not believe on-the-job training is appropriate for their organisation.
 

According to a study commissioned by the Department for Business, Innovation and Skills to explore the economic value offered by government-funded post-19 qualifications, apprenticeships delivered the highest return if they comprised an individual’s first qualification at that level.
 
The report also estimated that learners who started taking further education qualifications of all forms, including NVQs and Basic Skills, in 2008/9 would generate an additional £75 billion for the economy over the course of their working lives when compared with what they would have contributed without them.
 
But a survey undertaken by the Chartered Institute for Personnel and Development revealed that 45% of the 500 employers polled had not taken on an apprentice in the last three years. Just over two thirds said that they did not consider such on-the-job training to be appropriate for their organisation.
 
A mere 35% planned to offer apprenticeships this year, with 43% indicating that they would not and 22% saying that they had no set plans because of the uncertain economic environment.
 
The 2011 Learning and Talent Development Survey, which was undertaken in January, before Chancellor George Osborne announced new apprenticeship funding in his Budget, indicated that 48% would be encouraged to create new or additional places if they received higher subsidies, however.
 
But Katerina Rudiger, the CIPD’s skills policy adviser, said the fact that many employers did not consider work placements right for their organisation demonstrated that additional funding alone would not be enough.
 
“Demand for apprentices in England has always been very low, especially when compared internationally. The government, therefore, needs to do more to make the business case to employers, highlighting the benefits apprentices can bring to organisations such as relevant skills, loyalty, high quality and greater productivity,” she added.
 
Such on-the-job training also needed to be of higher quality if it was to contribute to raising the UK’s intermediate skills base, however. “The proportion of higher-level apprenticeships in England is still too low, with our research showing most still pitched at a low level,” Rudiger said.
 
Such a move would enhance the overall brand and credibility of such placements in the labour market, but the government needed to be wary of simply funding lower-level schemes that consisted primarily of the kind of initial on-the-job training that employers would provide anyway.
 
“Apprenticeship provision needs to improve by increasing the volume and quality of relevant training, and also through employers providing clear progression routes. The real return from apprenticeships is only achieved where the employer is willing to provide career progression beyond the initial apprenticeship,” Rudiger said.