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Reframing apprenticeships: the importance of level 2 and 3 apprenticeships

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Level two and three apprenticeships offer qualifications at a level equivalent to GCSEs and A-Levels. The difference between apprenticeships and their corresponding qualifications is that apprentices work while studying, gaining on-the-job experience and effectively being paid to learn. Delivered by employers in partnership with training providers, level two and three apprenticeships offer a concrete and reliable path into employment, and a steady supply of new recruits to companies that can train them in the specific skills they require.

However, these lower-level apprenticeships have been overshadowed in recent years by the higher- and degree-level apprenticeships that offer an alternative to university education. The declining uptake in level two and three apprenticeships reflects a missed opportunity for employers and employees alike. Here, we explore why.

Why has there been a decline in interest?

In October 2020 the Department for Education commissioned a report from IFF Research into the declining numbers of apprenticeship starts at levels two and three. The report stated that “since 2016/17 there has been a reduction in apprenticeship starts in England, and a shift in participation, with an increase at Level 4 and above, and a large fall at Levels 2 and 3.”

IFF Research found that companies are driven by distinct reasons to offer level two and level three apprenticeships. Level two apprenticeships were largely offered by employers who wanted to “create a foundation level of training and skills across the entire workforce” and who mostly recruit people with little or no experience. Conversely, level three apprenticeships were predominantly offered by companies who wanted to upskill their existing employees, seeing these as an opportunity to support “more experienced staff looking to move into more specialised or supervisory roles.” Both useful approaches to plugging existing gaps in the workforce, as we will see later.

Access to level two and three apprenticeships is often facilitated by a provider which tests would-be-apprentices to determine their level. Given this, IFF Research concluded that the decline in apprenticeship starts at levels two and three was determined more by the decreasing number of employers and providers offering these apprenticeships, than by a decrease in desire to take up these roles by apprentices. Apprentices themselves don’t often select which level they’d like to start at. It’s important therefore to understand the reasons companies are now offering fewer apprenticeships at these lower levels.

Through conversations with employers, IFF Research determined that there were several key factors at play. Firstly, there is a requirement for apprentices to spend 20% of their time completing off-the-job training. Following reforms to apprenticeships in 2017 (when data shows the number of apprenticeship starts began to decline), many employers felt that new requirements meant apprentices would be spending more time than previously completing off-the-job training. Employers perceived this as a reduction in the value for money that apprenticeships offer. There was also concern among employers that apprentices would not meet, or would struggle to meet, the new standards for English and maths, and might not meet requirements at their end-point assessments. Both these factors led to a reluctance among employers to offer apprenticeships at these levels.

IFF Research also discovered a lack of understanding among employers about what off-the-job  training consisted of. It was incorrectly understood by many as time away from the job, whereas such training can include on-site training such as shadowing. The report concluded: “Employers felt that higher levels of apprenticeships offered a better return on investment than levels two and three, in terms of improved productivity and skills.”

The value of entry-level apprenticeships

IFF Research found that most stakeholders, employers and providers “largely believed that the decline in Level 2 apprenticeship numbers was negative, because Level 2 is perceived to provide a suitable entry-level route into employment for people with lower-level qualifications and skills, and Level 2 apprenticeships match the entry-level job roles for which employers have a need.”

This suggests that these apprenticeship levels could play a significant role in tackling challenges currently facing the UK economy. The combined effects of Brexit and the global pandemic have resulted in a shortage of workers and a significant skills gap in the UK. The Recruitment and Employment Confederation reports 95% of its recruitment company members saying labour shortages are the single biggest issue across all sectors. FE Week spoke to Duncan Buchanan, the Road Haulage Association’s director of policy for England and Wales, an association that represents over 7,000 logistics companies, who commented: “We need people trained well at level 2 to do a proper job, be those plumbers, lorry drivers or in refuse collection.” Furthermore, the association’s skills policy manager, Sally Gilson, said over 60% of logistics jobs are at level 2, yet apprenticeship figures for 2020/21 show starts at level 4 and above increased by over 20% on 2019/20. She explained: “Our big frustration has been the lack of funding at that level 2.” The level of funding available means that level two apprenticeships hold less of an appeal for employers than level four apprenticeships, despite them performing an essential role in recruitment for the sector.

Currently, skills and worker gaps exist both at entry level and at executive/director level. IFF Research has suggested two ways that level two and three apprenticeships can be employed more effectively, which could tackle both gaps. The first is in succession planning: using apprenticeships to target specific skills gaps, employers can retrain existing staff to take up the leadership roles which are currently proving difficult to recruit for. Secondly, the report highlights the potential if level two and three apprenticeships are promoted as a consecutive pathway. If employers are encouraged to take on apprentices at level two and carry them through to the completion of a level three apprenticeship, they will see a higher return on their investment. Similarly, apprentices would complete their studies with more comprehensive work experience and higher qualifications. These two approaches can help to plug the existing gaps in the UK workforce, which level four apprenticeships and above are not well placed to do.

Finally, it is imperative that work is done to improve employer understanding of the requirements of apprenticeships at levels two and three, especially around off-the-job training. Employers should not see this as time away from the job but as added value. Similarly, more work could be done with schools to promote these pathways as valid alternatives to academic routes. At a time when prices are rising and employment is difficult to find, the opportunity to work while studying and follow a reliable path to employment should be promoted as at least on a par with traditional college and university routes.

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