Apprenticeship funding cuts will impact engineering firms

Dr Mandy Crawford-Lee, UVAC chief executive

New research has revealed that the Government’s decision to cut levy funding of Level 7 apprenticeships for people aged over 21 from January next year will cost UK employers – many from the engineering sector - around £214 million in additional training costs. With 89% of Level 7 apprentices aged over 21, research from the University Vocational Awards Council (UVAC), the higher and degree apprenticeship voice for over 80 universities, also reveals the extent to which cuts will widen the skills gap, hinder social inclusion and stifle economic growth.

Level 7 apprenticeships, which are the equivalent to a Master’s degree and proven to enable engineering firms to upskill and develop future managers, business leaders or fill specialist roles, comes at a time when they are increasing in popularity.

The latest data from UVAC reveals that year-on-year Level 7 apprenticeship starts have risen 13% in the last three years and five percent in the last 12 months – underlying their importance to many businesses across the UK. In addition, the National Foundation of Educational Research had previously found that 90% of roles within firms across all sectors will require higher-level skills by 2035, highlighting how more employers than ever are dependent on degree apprenticeships at levels 6 and 7.

Dr Mandy Crawford-Lee, UVAC chief executive, said: “The Government’s policy to remove vital levy funding - that is supporting nine in 10 Level 7 apprentices - is a major blow to engineering employers and will leave them facing both huge training bill costs and a skills shortage headache. This funding black hole is at a time when Level 7 apprenticeships have been growing in popularity year-on-year and are critical to driving wider economic growth.”

Clear career pathway
She continued: “They are also proven to enhance social mobility - giving individuals from underserved communities a clear career pathway, access to higher education and the skills to achieve their full earning potential in senior-level positions. This new policy ultimately feels like a contradiction to Labour’s Industrial Strategy, where it insists there will be ‘no glass ceiling on the ambitions of young people in Britain’.”

Although Government spending on Level 7 had stagnated under the previous Government over the last three years, it still accounted for around 10% of the Department for Education’s overall apprenticeship budget.

Dr Crawford-Lee added: “Removing funding for those Level 7 apprentices indicates to us that the Government is unfortunately not looking to prioritise the career and skills progression of engineering employees at every stage of their working life. It is disappointing that the Government places such little emphasis on the link between skills and productivity.”

She concluded: We simply don’t believe that reducing Level 7 funding eligibility will make lower-level apprenticeships more attractive to engineering employers, or more importantly - reduce the number of young people not in employment, education or training (NEETs). It would seem that tackling NEETs is now the Government’s policy priority at the expense of developing the skills provision needed for a highly skilled, world-beating economy.”