Of all the interesting areas covered at Symposium’s flagship Apprentice and School Leaver conference on 3rd December 2015, none sparked as much debate as the impending apprenticeship levy and the accompanying changes to the funding of apprentice training. Listening to the various view points and concerns voiced by my fellow conference delegates I was inspired to consider the subject further.
In summary, the levy will be set at 0.5% of an employer’s salary bill; recovered through the Pay As You Earn system with the first payment expected in April 2017. The levy will only apply to organisations with an annual salary bill in excess of £3m and there will be an allowance of £15,000 to offset against payment. The money collected will be translated into electronic vouchers which are then made available for the purchase of apprentice training from recognised training providers. The goal: three million apprenticeships by 2020.
There is no denying that encouraging employers to create and sustain genuine apprenticeships with relevant training, high-level skills development and an accompanying job is most definitely the right thing to do. However, is using what some business leaders are calling a ‘payroll tax’, really the correct approach? Whole-hearted organisational commitment to quality apprenticeships is needed to ensure they take their rightful place in the career landscape. Is this level of buy-in engendered by using what is being seen by others as a form of incentivisation?
Like all change, the response from individuals and organisations will be and has been varied; some see the benefits and opportunities; some see the problems and pitfalls. Whatever your point of view my personal perspective is that the levy seems like a very blunt tool to deal with an intricate and deeply people-centric challenge. Would a more sophisticated solution have been more conducive to truly influencing change; especially against a back drop of complexity and differing priorities?
Developing skills and our talent pool is an organisational, social and economic imperative and greater numbers of high quality apprenticeships will make a pivotal contribution. Introduction of the levy is supposed to support this as well as increase employer ownership of their apprentice training. With many positive outcomes being tabled, why are there concerns and scepticism abound?
While reflecting on these questions I was reminded of the book Instant Influence by Dr Michael Pantalon. In it he writes about his experience and research into ethically influencing change in others. It is an interesting read which I would recommend. Two particular insights resonated with me in relation to the apprenticeship levy and the reaction to its introduction.
Digging our heels in. The law of psychological reactance describes our response to being told to do something. Being dictated to can cause us to feel less inclined to co-operate or act, even if we ‘might have otherwise felt like doing it’. Little wonder there is some resistance to the changes associated with the apprenticeship levy.
Making it personal. Dr Pantalon’s work repeatedly demonstrates people are more likely to be motivated by what matters to them personally and not by external threats or promises. We see this in our everyday lives and know it to be true of ourselves. The apprenticeship levy targets the wallet not hearts and minds. There is no doubt that extrinsic rewards or threats work on occasion but internal motivation certainly has a more powerful influence over change and commitment.
The party line is that organisations affected by the levy will ‘get more out than they pay in’. Based on insights from Symposium’s conference, the jury is certainly still out. In the words of Led Zeppelin, when the levy breaks whether it will be a stairway to heaven or a heartbreaker is still a subject for heated debate. Whatever the strength of feeling, the reality is those who are committed to providing valid high quality apprenticeships with access to real employment opportunities will continue to invest in our upcoming talent regardless of the challenges.
Our Excellence in Apprentice Recruitment training day will equip you with the knowledge you need to be able to establish a new apprenticeship programme, scale up an existing programme or re-focus your programme for excellence.