London’s Skill Gap: Time for a Real Fix
Big firms in London and the South‑East are scrambling to fill tech vacancies, but the current “Apprenticeship Levy” scheme is tangled enough to make anyone’s head spin. The S&A Academy – a training brand that builds tailored apprenticeship programmes – says it’s high time we rethink how we reward workplaces for cultivating talent.
What’s the Noise About?
The levy, introduced in 2017, has been tweaked more often than your favourite retro‑video‑game console. The result? Managers are left guessing which training routes actually qualify for the tax‑break. Most small‑business owners assume they’re out of the loop, yet they can still snag government money if they launch a program that leads to one of the 800 recognised apprenticeship standards.
Put simply:
- Welsh, sticky, 5% — you bump up the apprenticeship salary, and the government covers the rest.
- Levy‑funds are “use it or lose it.” If you keep it idle, the money vanishes.
- Salary for apprentices? Covered. Employment National Insurance Contributions? None.
But most companies still see it as an extra cost, not a pipeline to long‑term growth.
The Numbers Don’t Lie
According to FE Week’s latest FOI data, spend on Level 2 apprenticeships dropped from £622 million in 2017/18 to £421 million in 2021/22. Meanwhile, higher‑level apprenticeships received a boost: the money is moving toward roles that actually meet industry demands.
Rachel Thomas’s Take
Director Rachel Thomas of the S&A Academy says the scheme has become a maze:
“Employers can’t see the wood for the trees. They need to investment in skills to grow, but many think apprenticeship is just another expense. They’re missing out on a real growth engine.”
She adds:
- “An apprenticeship can be built to suit your business” – so you can choose the model that works best.
- “If you don’t spend the levy each year, you waste money.”
- “A plus for apprentices? No National Insurance contributions from your side.”
What’s the Fix?
- Simplify the system. Don’t let managers feel lost.
- Offer a tax break that makes the levy a savings rather than a cost.
- Make it available for every employer, big or small.
- Show clear guidance and “signposting” so company heads and learners know where to get help.
Rachel wraps it up, “When firms invest in apprenticeships, they’re not just putting out a job. They’re giving future talent a road map and a mentor. That’s a win-win.”
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