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Apprenticeship levy no guarantee skills gap can be tackled

Moves by the government to levy larger firms to increase the number of apprentices is no guarantee that the skills gap that plagues the channel can be eradicated

If there is one area where the channel has overlapped with government policy it has been around apprenticeships with vendors as well as resellers opening their doors to the next generation.

The benefits for the channel have been to get access to the next wave of graduates and to give them the skills that are required to make them a potential asset to the business.

For the government it has been a reaction initially to a slow jobs market and then to ongoing problems with youth unemployment levels.

Although more jobs have been created the decision to keep the apprenticeship policies working was underlined in the Autumn Statement from the Chancellor.

Among the many things George Osborne said in a speech that also touched on the need for more spending on cyber security he found time to reveal plans for an apprenticeship levy.

The levy would be set at 0.5% of an employer's wage bill, with a £15,000 allowance for all firms taking part, which could raise at least £3bn for the government by the end of this parliament, as an additional charge that firms have to deal with.

Firms with revenues of less than £3m are not going to pay the levy, which comes into force from April 2017.

One of the criticisms of the apprenticeship schemes that have been backed by the government in recent years is that it has not produced a quality experience for the candidates or a good enough end result for the firms that took part.

Osborne hopes that the levy and allowances will make it more likely that those taking part will feel they have more invested in the success of the scheme.

The response from the industry was mixed with some worried that the levy would not go far enough to deal with a growing skills gap and that they could be further worries for firms hit by charges.

“The Government’s commitment to closing the skills gap through support for apprenticeships is a sharp move. It will undoubtedly impact companies within the technology sector - acting as a welcome aid for future growth, productivity and employment," said Lee Wade, CEO of Exponential-e.
“However, the sliding scale of the apprenticeship levy could threaten the future of smaller business apprenticeships. Smaller organisations may look to cut off their schemes to avoid tax debt, stifling their capacity to find, nurture and develop skilled staff," he said.
“Firms should look towards creating recruitment and training academies that prioritise staff development and pay attention to the soft skills and attributes employees bring, as well as their experiences, to overcome the skills chasm," he added.

Phil Smith, CEO of Cisco UKI, said that the levy on its own would not guarantee success and lead to a wave of skilled candidates coming into the job market.

"Skills and talent will be the key battle for business in the next decade and although we as companies understand the aims of the levy, we genuinely need the support from government to ensure that the apprenticeships it spawns are of the highest quality, targeted effectively, and benefit the whole of the economy. In particular, digital and STEM skills , which will be vital for the improvements in productivity we desperately need as a nation, have to be much more widely embedded into every company in the UK," he said.

The idea of the levy started to become a serious prospect back in the summer when the government started a consultation process to get the reaction from business over the idea.

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