Since its introduction in 2017, the Apprenticeship Levy became a reliable source of funding for apprenticeships, empowering employers to upskill their staff with a variety of training opportunities. All UK employers with a PAYE bill of over £3 million contribute 0.5% of their annual pay towards the levy, as it can be used on training costs.
It has been found that despite of this, employers have repeatedly underutilised funds. Since May, £11.5bn has been collected, yet only £3.6bn spent on training and a further £3bn was handed back to the treasury, as the funding was not used. With around £5 billion left of the remaining unspent funds, it presents an opportunity for employers to use that funding to upskill and reskill their workforce, developing their business.
The impact of the Apprenticeship Levy
Traditionally, apprenticeships have been associated with younger people entering a career path. With the levy system, the territory of apprenticeships expanded, broadening the potential remit of apprenticeships and allowing levy payers to take time to understand how it would be relevant to their industry and workforce.
Today we see a wide range of businesses paying into the levy, seeing it as a priority to support long-term recruitment and skill requirements. COVID heavily impacted the delivery of employment and training, so this gives the opportunity for businesses to reconfigure their workforce and bridge current skill gaps.
With close to £5 billion in employer accounts ready to be spent, and a growing strategic approach being taken by employers, the apprenticeship levy enables a sizeable opportunity to secure extra funds and a chance to improve the quality and quantity of apprenticeships.
For more information about funding through the apprenticeship levy, click here
