Gernot Krautberger - stock.adobe
The tech industry is facing a skills shortage, and with the number of students taking IT-related subjects for GCSE and A-levels falling, and university tuition fees set to drastically increase in price, apprenticeship schemes could be the answer to maintaining a skills pipeline with the next generation.
In-house apprenticeship versus further and higher education
With the number of students gaining IT-related GCSE and A-levels continuing to fall, and university tuition fees set to rocket in England and Wales next year, the IT sector is preparing alternative IT career paths for young people looking to enter the industry through internships.
A number of influential people in the IT industry are beginning to look at the need for standardisation in apprenticeship training programmes. Given the increase in university tuition fees, many students will be weighing up whether to go to university - which for most will mean taking a sizeable loan with uncertain prospects for employment - or try to gain work experience as interns or apprentices through an IT apprenticeship programme.
Karen Price, CEO at sector skills council, E-Skills UK, said only 2% of employers currently employ apprentices. However, an increasing number of organisations are planning to hire apprentices this year. In fact, 21% of companies plan to hire apprentices in the future, according to E-Skills.
Why apprenticeships work: niche skills gap expensive to fill
A roundtable event hosted by Capgemini and Business in the Community recently brought 83 IT sector representatives together to discuss how the technology sector can increase employment opportunities for young people through apprenticeship schemes.
Christine Hodgson, chairman at Capgemini UK, says: "A short time ago, the industry would never have come together to talk about apprenticeships. We see apprenticeships as a huge source of great talent."
Employers view IT apprenticeships as a way of training recruits up with niche - and otherwise expensive - skills.
Jonathan Ebsworth, vice-president of application services at Capgemini, says companies need young talent to fill niche skills gaps that are expensive to hire for, such as SAP, e-commerce and business intelligence skills.
A quarter of junior recruits entering Capgemini this year will be IT apprentices. The company's junior workforce will doubled to 200 next year.
"It takes two or three years to change a workforce's skill base. Alternatively, you could buy in the skills you need - which takes six to nine months to hire and recruit - or take the braver option of growing your own talent," Ebsworth says.
The challenge of standardisation in apprenticeship schemes
But what is an apprenticeship? Despite employers recognising the value of the IT apprentice, Peter Cheese, chair of Business in the Community's talent and leadership team, says standards are needed for apprenticeship accreditation to provide employers with a common framework.
Kate Shoesmith, head of policy and corporate affairs at City & Guilds, adds that an apprenticeship standard is needed so an IT apprentice can move between jobs and have a qualification recognised by all IT employers, such as NVQs.
IT industry body, Intellect believes standardisation will add value to apprenticeships, according to Carrie Hartnell, associate director at Intellect. She says qualification certificates gained by apprentices at large companies are likely to be recognised industry-wide. However, standards are needed to provide guidelines on varying IT skills.
She added that the industry recognises that IT apprenticeships are a crucial career path for the sector and will work together to set up necessary standards.
"Unless we have that diversity of education, the UK will suffer competitively against other countries," she says.
Identify and overcome problems in setting up an apprenticeship
However, setting up an apprenticeship scheme can be a laborious task for companies. Andy Palmer, BT director of education and skills, thinks there is still bureaucracy and complexity in setting up an apprenticeships scheme.
BT recently contributed to a review of apprenticeships conducted by the Department for Business, Innovation and Skills (BIS) Employer Reference Group, including representatives from the Confederation of British Industry (CBI). As a result, the government has announced plans to simplify employers' guidance, payment and assessment of apprentices, in a move that could help encourage more firms to take on IT apprentices.
A spokesman at the Department of Business, Innovation and Skills (BIS) says the government has introduced "tough new standards" to ensure that apprenticeships provide high quality and nationally recognised training that meets the needs of employers and apprentices.
The Specification of Apprenticeship Standards was introduced this year by the government in an attempt to provide a level of standardisation. Apprentices must now receive at least 280 hours of "guided learning" per year as part of the new requirements.
"Through an expanded, improved apprenticeship programme the government looks forward to working with more firms from the IT sector to help meet its skills needs," the spokesman adds.
But other issues still exist. Mike Morris, Cisco's apprentice programme director believes there is a lack of funding available to cover apprentices' travel expenses.
Parity for apprenticeships in state educational standards and funding
Karena Freeman, further education account director at Capgemini, adds that the perception of apprenticeships as sub-standard to graduate training still needs to change to appeal to the right candidates.
Other suggestions have included apprenticeships accruing UCAS points to provide a comparative academic career path to degree level as well as a need for a greater level of education for companies about how to set up a scheme.
E-Skills UK is working to translate occupational standards into qualifications and apprenticeship frameworks. Employers can propose new frameworks, using the Apprenticeship Framework Online system.
Technology apprenticeships for 16-18-year-olds are fully funded by government. Government funding of £25m is currently available for companies considering developing a higher level apprenticeships. The closing date for applications for funding is 16th September 2011.
While the government and E-Skills are working to standardise apprenticeships, complexities still exist in setting up an apprenticeship scheme and many businesses are still unclear on what guidance and funding is available.
Technology apprenticeships are starting to be seen as professional standard. For instance, the National Apprenticeship Service (NAS), provide apprenticeship frameworks, such as IT, software and telecoms professionals as well as IT applications specialist.
As young people start to evaluate their options in face of rising university tuition fees next year, the IT industry needs to ensure an alternative IT career path is well established - whether that's a standardised route or otherwise - or the UK's digital economy may suffer.
Top tips for businesses setting up an apprenticeship scheme
Find the funding
With limited headcount, Cisco used some of its travel budget to pay for the apprenticeship scheme. The increased use of video conferencing in the company meant some of the travel budget was unused. The company was able to pay its apprentices £150 a week.
Establish a peer group
Cathy Baxter, learning and development leader at PricewaterhouseCoopers (PwC) said it's important for companies to avoid hiring low numbers of apprentices.
"It's better for apprentices to have a small peer group to share ideas and experiences," she says.
Partner with a university
Logica partnered with Winchester University to provide its apprentices with a business management degree alongside a full-time job at Logica. Apprentices studied one day a week at the university.
Case study: How an IT firm grew its business five-fold after hiring apprentices
Computer repair company D&J Henry says its business grew five-fold after hiring apprentices.
By taking on apprentices, the Coventry-based firm grew from 15 employees to 74 over an 18-month period. The apprentices were supplied by training provider Pearson in Practice, through its Zenos IT apprenticeship programme.
David Henry, managing director of D&J Henry, admits the firm previously struggled to hire the right IT staff for engineering roles, but hiring apprentices for IT engineering jobs works out more cost-effective than recruiting highly skilled technicians.
"We were finding it impossible to recruit the right people and spent thousands on online recruitment agencies and advertising locally. Despite seeing hundreds of people, we couldn't find the engineering staff of the calibre we needed," he says.
The first five Zenos apprentices were recruited to support the company's core engineering team. It has also recently recruited a further 11 apprentices, who graduated in July 2011. Henry says the company plans to hire another 10 apprentices before the end of the year.
Apprentices receive a starting salary of £14,000.
Case study: From apprentice to business partner in a year
So what is an apprentice? Only a year after starting an apprenticeship at Cisco, 19-year-old Nat Debney-Davies was made a business partner.
Debney-Davies decided to pursue an apprenticeship as an alternative career path after being disappointed with his AS and A-level exam results. Having previously completed work experience at Cisco, he became the first apprentice the company took on.
Mike Morris, Cisco's apprentice programme director, said the company welcomed the proposal to set up an apprenticeship scheme.
Debney-Davies spent time work shadowing and taking responsibility for projects. As his work load increased, Morris says colleagues soon treated Debney-Davies as his stand-in.
As Cisco is reducing its workforce, Morris is leaving the company and decided to make Debney-Davies his business partner in a new venture.
Morris says his decision is a result of the time Debney-Davies saved him and the work he contributed during his time as a Cisco apprentice.