Apprenticeships Starts – The numbers behind the headlines

13 October 2017

Unsurprisingly, yesterday’s apprenticeships data has made headlines for the wrong reasons – with 70,000 fewer people starting apprentices this summer compared with last summer.  As Stephen Evans said in his blog yesterday, it is too early to say whether this is a permanent or a temporary problem.  So in this blog, I’ve looked behind the headline figures to see what else may be going on.  This identifies two potential issues: a shift from intermediate to advanced and higher apprenticeships, and potential falls in participation by young people.  And both of these could in turn be exacerbated by the structure of the Levy.

Quarterly apprenticeships starts

 

First though, it is important to note that on apprenticeship starts overall – looked at over the whole year – the figures are remarkably stable.  While there has been a sharp fall in starts this summer (i.e. immediately after the Levy), this was largely compensated for by big increases in starts in the spring (i.e. immediately before it).

The first chart shows the starts by quarter for the last three years. For the first two quarters of 2016/7, the pattern of starts was virtually the same as the previous year. Quarter 3 saw an increase of at least 50,000 over the normal pattern. The fourth quarter, as Stephen Evans said, was 70,000 down on the 2015/6. Across the year, we are 18,000 down. The Expected line is simply the change from 2014/5 to 2015/6 applied to the 2015/6 starts, so nothing sophisticated.

 

 

all apprenticeships

 

 

 

So provisional starts in 2016/17 overall are 3.6% lower than the final figures for 2015/16 (around 18,000 starts), and 2.5% lower than the provisional figures for 2015/6 released this time last year.

Taking a longer view, as the graph below does, illustrates that this is not a big fall.  However it is also not a strong growth trend either, which is arguably what the government needs in order to hit its 3 million by 2020 target.

The actual number of starts is 18,100 down on last year’s final out-turn.

 

 

 

 

What is more interesting is the breakdowns of the change, both by apprenticeship level and by age. For apprenticeship levels, the big story is a continued growth in Higher apprenticeships, rough stability in Advanced apprenticeships, and declines in Intermediate apprenticeships.

The DfE release states:

Starts in higher and advanced apprenticeship levels increased by 35.1 and 3.9 per cent respectively, whereas starts at intermediate level decreased by 10.1 per cent in the 2016/17 academic year compared to the same point in 2015/16.

This looks like:

Higher Intemediate and advanced apprenticeship

 

These patterns are trends, rather than one-offs for this year or quarter. In future years, we expect Degree apprenticeships to follow a similar growth trend to Higher apprenticeships.

The graph above shows that the growth in Higher and Advanced apprenticeships predates the levy.  However, until this year, we would not have so clearly identified a fall in Intermediate apprenticeships.  In effect, we are seeing significant recent shifts in the composition of apprenticeships, away from intermediate levels and towards more advanced levels.

By age, there is less of a clear pattern. This year, there is a rise in over 25 starts, and falls (of over 10,000 each) for under 19s and 19-24s. However, over the longer period, these could fall into the ‘could be a blip’ category.

under 19 - 25 +

The Under 19 starts look ‘broadly stable’, 19-24 starts look to be trending down, and 25+ starts are so volatile that working out whether this year’s small rise is part of a trend or not is difficult.

The growth of Higher (and later Degree) apprenticeships may well be meeting a need. There is a growing literature showing that high-productivity firms pursue a range of management practices that generate high productivity. See, for example, the references to this ONS experimental survey analysis.

The Office for National Statistics results are consistent with the basic thrust of the research. Managers in the UK need to be better educated, and to pursue better management practices. And, the results of so doing could produce good results for overall productivity.

However, this is only the case if the support through the apprenticeship Levy or other funding actually improves management practices. If it simply replaces current funding by employers or individuals that is highly geared towards management training – as some have feared –then no additional benefit will occur.

It also gets to the heart of a question around what our apprenticeships system is for.   The sort of apprenticeships resulting from these trends may look rather more like Lord Sugar TV apprentices than skilled vocational jobs with training. So if the shift away from intermediate training is part of a trend, then this will do little to tackle the ‘long tail of low achievement’ which continues to be a feature of the UK.  As we have said before, we could end up hitting the target but missing the point.

Paul Bivand