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A third unaware apprenticeship levy is coming

A third of employers do not even know the apprenticeship levy – coming into force in April – even exists

A third (33%) of UK employers eligible to pay the new apprenticeship levy are unaware it even exists, according to a survey from City & Guilds.

The report also uncovered a lack of understanding about the way the levy could be used to train existing staff and the range of jobs that apprenticeships could potentially be used to train for. Only 18% said they knew that apprenticeships could be used for caring, leisure and other services jobs. Just one in five (19%) knew apprenticeships could be used to train managers and leaders.

Worryingly, 23% of the heads of apprenticeships surveyed were not aware of the new apprenticeship system. More than a quarter (28%) of all those surveyed were not sure whether the changes would apply to their business.

A vast majority (87%) of employers reported that they currently struggle to recruit the staff they need. Almost three in 10 (29%) said they find it hard to fill apprenticeship places, and this is before competition for talented candidates intensifies following the introduction of the levy.

City & Guilds UK managing director Kirstie Donnelly described the results of the survey as concerning.

“The lack of awareness about the new apprenticeship system among our respondents is a cause for concern and shows that we still have a hill to climb in convincing people about the benefits apprentices can bring to business,” she said. “However, those that do know about the levy are saying it is a great way for employers to pay for training, so there is clearly understanding and appreciation of apprenticeships out there.

“With just two months to go until the levy begins it’s vital that everyone in the skills sector and government gets out there and communicates with these less-enlightened businesses to help them see the huge potential benefits apprenticeships can bring.”

Writing for HR magazine about the levy, KPMG's head of people Ann Brown said "mature" employers are linking apprenticeships to strategic workforce planning and "using the levy as a ring-fenced budget to address diversity, mobility and skills challenges".

"For companies just starting this journey the best advice we can give is to use the levy as an opportunity to look at your business and identify how bringing in apprentices can address your long-term skills and people needs," she added.

The levy will be introduced in April for employers in England with an annual payroll of more than £3 million. It equates to 0.5% of an employer's annual wage bill and will be paid through HMRC.