Reforming Apprenticeship Levy will unlock opportunities at Yorkshire firms: Terry Jones

On the face of it, those numbers appear to be healthy enough, but the underlying trend is that fewer people are starting an apprenticeship than in previous years, with start rates falling by 3.5 per cent on 2021/22 figures.

The question is: why is this happening? Is it a lack of appetite from school leavers wishing to follow this particular career path?

Or does it boil down to the ability of businesses to offer such placements? It would appear that the latter is heavily influencing how many 16-plus apprentices are currently in the system.

Our latest bi-monthly Economic Engine survey of 500 mid-sized businesses certainly proves this point.

In fact, in Yorkshire, 40 per cent of businesses said they wanted to hire more apprentices, but the costs associated with doing so were simply too high.

If you consider that a further 38 per cent of regional companies cited a lack of guidance on how to go about hiring apprentices as one of the biggest reasons for not recruiting more, then you begin to see why the numbers are falling.

Less than one in five Yorkshire businesses (16 per cent) are regularly hiring through the Apprenticeship Levy. More than a third (43 per cent) of respondents are calling for greater support from any future government to resolve endemic staff and skills shortages.

This includes reform to the Levy to help increase productivity, fuel economic growth, and raise wages.

Under the current system, if you have an annual pay bill of over £3 million you must pay 0.5 per cent of that into the levy. However, this pot of money can only be spent on very specific types of training and has come under fire from many sectors, including retail, hospitality and tech, as ‘a £3.5 billion mistake’.

It’s little wonder that according to our survey, reforming the Apprenticeship Levy ranks ahead of the likes of tax breaks and regulatory changes, demonstrating the importance of skills and recruitment to those businesses that sit at the heart of the region’s economy.

The importance of apprentices to the economic growth of the region and UK as a whole is not lost on anyone, least of all the businesses at the heart of our economy.

Mid-sized businesses are responsible for more than eight million jobs, the equivalent of one in four across the UK and, with the right level of targeted support, together we can help them kick start their hiring – boosting the number of high quality opportunities on offer to younger generations and providing the skills Yorkshire so desperately needs.

At BDO, every day we are lucky to see first-hand the benefits of bringing in young talent through our early career programmes. As a large employer of more than 7,500 people, our role in progressing the next generation of professionals has never been more important. We know one size does not fit all, so we hope that by offering a number of entry routes, we are creating opportunities for a wider range of people.

Programmes like Explore BDO, a week long experience designed for those from less privileged backgrounds get a taste of the world of accountancy, play a huge role in improving social mobility both in our industry and across the UK. It’s vital that we as a firm continue to play a part in this.

Terry Jones is Head of BDO in Yorkshire and Humber