Youth apprenticeships and the case for a flexible skills levy

This report outlines recommendations for a more flexible levy and the introduction of an Apprenticeship Guarantee for young people to rebalance financial subsidies towards younger apprentices.

Recommendations for policy-makers

As it currently stands, the Apprenticeship Levy scheme has not succeeded in reversing the decline in employer investment in training, addressing poor productivity, nor enhancing the quantity and quality of apprenticeships. In reconsidering this area of policy, the next UK Government should aim at: 

• rebalancing the apprenticeship system to primarily benefit young people, particularly those who experience socio-economic disadvantage, and
• boosting employer investment in training and tackling critical skills shortages and skills.

This will require changes to the apprenticeship as well as the broader skills ecosystem as a whole. The CIPD recommends targeted action by the UK Government in the following areas:

• reforming the Apprenticeship Levy into a more flexible skills levy
• establishing an Apprenticeship Guarantee for young people aged 16-24
• rebalancing incentives to encourage increased investment in youth apprenticeships
• developing 'pathway' apprenticeships through a refreshed pre-apprenticeship programme
• offering financial incentives to boost apprenticeship opportunities in small firms
• strengthening sector institutions to help employers collectively identify and address emerging skills gaps and shortages at an industry level, as part of a renewed approach to industrial strategy.

Download the report for the details of these recommendations.