Trading up or trading off?: understanding recent changes to England's apprenticeships system

This report addresses the implications changes to the apprenticeships system in England. From 2017, large firms were required to pay 0.5 per cent of their wage bill into an apprenticeship levy, while regulations on training and delivery were firmed up. Two years on, this briefing note takes stock of the system, looking at what's changed, why and where policy makers should consider moving next. The system today is smaller: there were 25 per cent (124,000) fewer apprenticeship starts in 2017/18 than there were in 2014/15 and this fall was primarily driven by a reduction in starts at lower levels of study, which nearly halved. Critics of the levy are quick to blame it for the overall fall in starts, but this briefing note finds that levy-paying firms are just as likely as non-levy payers to invest in the types of lower-level programmes that have experienced substantial reductions in numbers. Instead, it looks as though regulatory reforms, which required more training (and more money), offer a more convincing explanation for the reduction in numbers.

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