How apprenticeships can boost economy and employment

Apprenticeships have become a key government policy in the UK, as they are seen to address the skills gap, improve productivity and competitiveness, and support social mobility and inclusion. According to the Department for Education, there were 742,400 apprentices in England in 2019/20, an increase of 18% from the previous year. The government has also set a target of creating 3 million new apprenticeships by 2024.

But what are the benefits of apprenticeships for the UK economy and the job market? Here are some of the main advantages that apprenticeships can offer:

Apprenticeships can increase productivity and innovation.

Apprenticeships can help businesses to improve their performance and efficiency by developing the skills and knowledge of their workforce. According to a study by the Centre for Economics and Business Research, apprenticeships contributed ￡34 billion to the UK economy in 2019, and this figure is expected to rise to ￡40 billion by 2022. The study also found that apprenticeships can increase the productivity of each apprentice by an average of ￡214 per week, and that 78% of employers reported improved productivity because of hiring apprentices .

Apprenticeships can also foster innovation and creativity, as apprentices bring fresh ideas and perspectives to their workplaces. They can also help businesses to adapt to changing technologies and customer demands, as they learn the latest skills and methods in their sectors. A survey by the Association of Graduate Recruiters found that 76% of employers said that apprenticeships helped them to develop new products or services, and 71% said that apprenticeships helped them to access new markets.

Apprenticeships can reduce unemployment and improve social mobility.

Apprenticeships can provide opportunities for people of all ages and backgrounds to enter the labour market and progress in their careers. They can also help to reduce unemployment and underemployment, especially among young people who may face barriers to finding work. According to the Office for National Statistics, the unemployment rate for 16-24 year olds in the UK was 13.2% in the three months to February 2021, compared to 4.9% for the whole population. Apprenticeships can offer a viable alternative to traditional education pathways, as they allow young people to earn while they learn and gain a nationally recognised qualification.

Apprenticeships can also improve social mobility and inclusion, as they can help people from disadvantaged backgrounds to access higher education and better-paid jobs. A study by the Social Mobility Commission found that apprentices from lower socio-economic backgrounds can earn up to 16% more than their peers who did not do an apprenticeship, and that higher and degree apprenticeships can boost earnings by up to 34%. The study also found that apprenticeships can reduce the gender pay gap, as female apprentices can earn up to 21% more than their non-apprentice counterparts.

Apprenticeships support the recovery from the pandemic

Apprenticeships can play a vital role in helping the UK economy and the job market to recover from the impact of the COVID-19 pandemic, which has caused unprecedented disruption and uncertainty. Apprenticeships can help businesses to retain and reskill their existing staff, as well as to recruit new talent that can help them to survive and thrive in the post-pandemic world. They can also help individuals to secure and sustain employment, as well as to upskill and retrain for new or emerging sectors and occupations.

The government has introduced several measures to support apprenticeships during the pandemic, such as increasing the incentive payments for hiring new apprentices, extending the eligibility criteria for the apprenticeship levy, and providing additional funding for traineeships and sector-based work academies. The government has also launched the Kickstart Scheme, which provides funding for employers to create six-month work placements for 16-24 year olds who are on Universal Credit and at risk of long-term unemployment.

In summary, apprenticeships can offer significant benefits for the UK economy and the job market, as they can increase productivity and innovation, reduce unemployment, and improve social mobility, and support the recovery from the COVID-19 pandemic. Apprenticeships can also benefit individuals and employers, as they can provide a rewarding and flexible way of learning and working. Therefore, it is vital that businesses, education providers, and policy makers continue to invest in and promote apprenticeships as a key driver of economic and social development.

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