The sub-committee on education, skills and the economy issued a report today which states Whitehall’s apprenticeship policies “have a worrying lack of focus” and will fail to plug widening skills gaps unless they concentrate on sectors and regions where training is most needed.
A survey by the UK Commission for Employment and Skills found 209,500 reported skilled vacancies in 2016, a 43% rise from the 146,000 vacancies recorded three years earlier.
This is despite apprenticeship 'starts' increasing to 509,400 in 2015-16, according to official figures, although only 67% of these were completed.
MPs said the apprenticeship levy, which aims to help three million 'starts' by 2020, is a blunt instrument “that risks being unduly focused on simply raising participation levels”.
The levy, which comes into affect in April, was conceived in 2015 and requires employers to fund new apprenticeships via a 0.5% tax. However it will only be paid by employers with an annual payroll in excess of £3m, meaning less than 2% of UK employers will pay it.
The committee raised concerns about the “top-down” three million ‘starts’ target, which it fears could “hamper attempts to raise quality of provision”.
Ian Wright, co-chair of the committee, said too much training was “sub-standard” and detrimental to the career of apprentices and, more widely, the performance of the UK economy.
He added that the centrally-dictated target is “inherently contradictory” to ministers’ insistence that it will address the requirements of different sectors and regions.
The report said ministers should instead take a more “bottom-up” approach, centred on these diverse needs, that targets areas of the economy and country with particularly acute skills shortages.
It also called for more emphasis on outcomes, judging the success of apprenticeships by, for example, whether they lead to employment.
Neil Carmichael, also co-chair of the committee, stressed apprenticeships need to be seen as a “means to an end and not an end in themselves”.
He said: “Apprenticeships are vital if we are to close the skills gap, which could grow wider post-Brexit.
“We must train our young people for jobs that the economy needs, but the government has failed to show how its three million target and levy will help achieve this.”
The committee urged the government to publish an annual report on skills shortages on a national, regional and sector-specific basis and to set targets on addressing these shortfalls.
MPs have welcomed the creation of the Institute for Apprenticeships, which they expect will play a major role in improving quality in the future. However they cautioned that the new body must be given sufficient capacity and independence if it is to succeed.
Further support for apprentices was also called for, including changes to the benefits system, more subsidised fares on public transport and even direct financial support such as bursaries.
