Since the levy was introduced four years ago, total apprenticeship starts have fallen from 494,900 in 2016-17 to 322,500 in 2019-20.

The number of apprenticeships going to under-19s also dropped from 122,800 to 76,300, while total apprenticeships going to 19-24 year-olds declined from 142,200 per year to 95,300.

Interestingly, the CIPD also found that despite the levy having been introduced to help drive employer investment in training, employer-funded off-the-job training in England fell by £2.3bn between 2017 and 2019.

As such, the CIPD has called for the levy to be overhauled, urging the Chancellor to introduce a more flexible training levy in the Budget this week to boost employer investment in workforce skills and help the economy recover.

“On all key measures the apprenticeship levy has failed and is even acting to constrain firms’ investment in apprenticeships and skills more broadly,” CIPD chief executive Peter Cheese says.

“It appears to have achieved the opposite of its policy objectives. Without reform it will act as handbrake on employer investment in skills, damaging firms’ ability to recover from the pandemic.
 
“A more flexible skills levy would mean employers could use it to develop existing staff through other forms of accredited training and skills development which are cheaper and usually much more suitable for employees aged 25 and over, leaving more money to invest in apprenticeships for young people who most need them.”

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