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Jamie Lawrence


Insights Director

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Organisations should approach apprenticeship levy as an investment, not a tax


This is an interview with David Willett, Director of Corporate Sales at The Open University. TrainingZone has worked with The Open University to produce a whitepaper on Higher and Degree Apprenticeships for organisations that want to make the most of the apprenticeship levy. It’s free and available to download now.

Jamie Lawrence, Managing Editor, What’s the ideal mindset organisations should have to ensure they get the most value out of the apprenticeship levy?

David Willett, The Open University: Organisations that approach the levy as an investment, rather than a tax, will undoubtably get the most value.

The apprenticeship levy has been designed to help employers in England by encouraging them to develop higher-level skills to improve performance, productivity and social mobility – but only organisations that embrace the potential opportunities that the levy presents will truly reap the benefits.

Many employers report they are struggling to find staff with the right skills – the levy, along with the introduction of higher and degree apprenticeships, provides the opportunity for employers to grow the skills they need now and in the future, while increasing employee engagement and motivation.

By viewing it as a positive step that will pay dividends, organisations will be best placed to get the most value from the apprenticeship levy.

Jamie Lawrence, Managing Editor, What might some organisations not know about the apprenticeship levy?

David Willett, The Open University: There is still a lot of work to be done to communicate all the benefits of the apprenticeship levy to employers, but there is also a lot of confusion around how it works.

One little known fact, but a crucial one for organisations’ financial strategies, is that any unspent funds left in an employers’ digital account will expire on a rolling basis after 24 months – use it or lose it.

While levy-paying organisations are more likely to be aware of how it can be used, smaller organisations might not be aware of how they can benefit.

For employers with a wage bill of less than £3 million, apprenticeghip training is heavily subsidised. They only have to pay 10% of their apprenticeship training fees, with the UK government picking up the rest of the bill.  

The sheer variety of apprenticeships available might be surprising to some; from different levels (ranging from GCSE equivalent up to masters degree) and different specialisms (there’s a relevant apprenticeship for many occupations).

Plus apprenticeships are not limited to vocational careers – employers can use the funding to build management or IT skills that can help their organisations to become more agile and adaptable to the changing business environment.

Jamie Lawrence, Managing Editor, How do we tackle out-of-date views on the value of apprenticeships?

David Willett, The Open University: Traditionally, apprenticeships have been restricted to vocational topics, and have been held in lower esteem in some quarters than more academic paths of study as a result. However, this is no longer the case. Universities and training providers are now offering a much wider range of apprenticeship programmes – with many more in the pipeline – so work-based learning is becoming a real viable option for upskilling and reskilling staff.

With the introduction of degree apprenticeships, both academic theory and work-based learning are converging more than ever before, but there is still a job to do to educate both schools and business leaders about the options and benefits.

With university fees at an all time high, degree apprenticeships offer students the opportunity to earn while they study towards a degree, and they are able to build valuable work experience and put the skills they learn into practice right away, which is a huge benefit to organisations that previously would have taken on graduates with limited experience of working life.

One other myth to dispel is that apprenticeships are only for young people at the beginning of their careers,  when in fact employees can be apprentices at any age. Within organisations, apprenticeships can be used to train staff to a higher level to reach the next step in their careers, which benefits motivation and engagement, and provides organisations with highly skilled and experienced employees.

With the employers we’re working with at The Open University, it’s quite an even split between organisations using degree apprenticeships for new hires compared to those developing existing staff.

Jamie Lawrence, Managing Editor, How can organisations use apprenticeships to develop their succession planning programmes?

David Willett, The Open University: Succession planning is vital to any business strategy, as it ensures that the right people, with the right skills and leadership potential, are able to step into business-critical positions at the right time. Through apprenticeships, employees gain new skills that make them more agile and adaptable within the changing workspace.

Rather than encouraging the development of narrow skillsets, apprenticeships can be used to provide workers with transferable skills, which allow them to adapt to new or changing situations.

Apprenticeships breed loyalty: supporting employees with skills-focused development programmes from the outset of their career creates engaged and motivated employees. Workers who feel they are a business asset will feel inclined to stay with an organisation and, when the time comes, will have the experience and skills to step into high-level roles.  

Jamie Lawrence, Managing Editor, If apprenticeships have a 20% off-the-job requirement, how can organisations ensure this portion adds value?

David Willett, The Open University: The time designated off-the-job learning provides an opportunity for both business and employee to diversify their skill set, should not be feared by business leaders, who often take this prescription too literally. Time dedicated to learning can be used both in theory and practice, including shadowing and attending meetings, just so long as the time isn’t spent doing their everyday job.

That’s not to say there’s not a lot of hard work and study required on the apprentices’ side, particularly if they’re doing a degree apprenticeship. However, finding a provider that offers flexilbity makes the process easier.

The Open University delivers its degree and higher appretniceships using technology, blending tutor visits with online tutorials, resources and forums, which means apprentices don’t have to leave the workplace and can study around their busy personal lives and demands of their job.

Naturally a part of this planning requirement is to ensure that the portion of time apprentices spend away from the workplace is used effectively. The work-based nature of apprenticeships means that despite spending time training off-the-job, workers are able to put what they learn into practice almost immediately.

To make the most of training, organisations should look out for apprenticeships that have been developed with employers in mind, which should ensure their needs are adequately met. 

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Jamie Lawrence

Insights Director

Read more from Jamie Lawrence