‘Apprenticeships can’t work without small businesses and young people’

SPONSORED

As we approach the second party conference season under a Labour government, I’ve had time to reflect on the things that ministers have got right about education over the past 14 months and the things they have still to improve. Apprenticeships formed a significant plank of the Labour 2024 manifesto, with the promise to introduce a new Growth and Skills Levy to help businesses develop vital skills and introduce new pathways into apprenticeships.

On paper, things seem to have been going well. In July, Education Secretary Bridget Phillipson took to X to celebrate ‘another Labour hat-trick’, pointing to figures showing that the number of people starting, participating in, and completing apprenticeships had improved compared to the same period last year. However, dig into this data and it shows a murkier picture – while starts have risen overall, the number of under-19s enrolling on apprenticeships has actually fallen.

Furthermore, while much of the policy debate has centred around those employers who pay the Apprenticeship Levy (i.e. those with an annual wage bill of over £3 million), it is the non-levy paying, smaller businesses who are disengaging from the apprenticeship system. This is where we see starts falling.

The apprenticeship system cannot be classed as a success if it’s failing to engage young people and small businesses.

Edge Foundation has a plan to turn these figures around. Firstly, we want to make the process of finding and applying for an apprenticeship easier for young people. Research supported by Edge shows that for every young person who obtained an apprenticeship, three tried to get one and were unable to progress – with too many giving up due to a lack of support and an unduly complex application process.

Many young people and employers find the Government’s Find an Apprenticeship website clunky, outdated, and plagued with technical difficulties. In addition, some employers choose to advertise apprenticeships solely on their own websites which means that potential applicants have to trawl through hundreds of websites and jobs boards to find the right opportunity. It’s unsurprising that only 3 in 10 young people think there are quality work opportunities in their local area, according to the 2025 Youth Voice Census.

READ MORE: Labour Party Conference 2025: Full LabourList events programme, revealed

Our new report, Chaos to Co-ordination, calls on the Government to create a true ‘one stop shop’ for apprenticeship applications, with employers obliged to advertise their opportunities on the Find an Apprenticeship website in order to access funding. This should go alongside a national campaign to align the apprenticeship application window with the academic school year.

But a one-stop shop is only as good as the opportunities it offers, and a huge chunk of the business population struggle to offer apprenticeships. We’ve seen a dramatic fall in the number of SMEs offering apprenticeships since the introduction of the Apprenticeship Levy. While they are more likely to hire young, at entry levels, and to provide opportunities away from big cities, SMEs have been left out of an apprenticeship system that is geared towards big business. Unlike large companies, SMEs often lack the time and money to navigate the complex system of hiring and managing an apprentice.

We all know these SMEs –  the local plumbers we call when our toddler decides to flush their barbie doll, the opticians who guide you through the slippery business of putting in your first set of contact lenses, the hairdresser who saves the day when you try to cut your own fringe, and many more who help make our lives work better. They deserve access to the talent that will help them grow and spread opportunity locally.

That’s why the second Edge report published today, Agents of Change, sets out a plan for a national brokerage service to support SMEs in understanding their skills needs and navigating the apprenticeship system. Crucially for SMEs, this brokerage service would help them understand the financial incentives available to apprentice employers, like a £1,000 incentive payment for apprentices aged 16-18, fully funded training for apprentices aged under 22, and a hugely welcome national insurance contribution (NIC) waiver for those under 25.

When we polled employers for this project with the help of the Recruitment and Employment Confederation, 68% of SMEs said that access to tailored advice and support would be an encouraging or decisive factor in choosing to hire an apprentice.

There are many forms that a service like this could take, as we explore in the report, but our preference would be for a nationally coordinated framework of brokerage services, designed and delivered according to local needs. We are not looking to duplicate existing provision, like the National Apprenticeship Hub Network, but we’d like to see services expand to areas not currently served.

A report can’t be where this ends though, and in fact it’s just the start. We are also launching a new campaign, Apprenticeships Work, to spread the message to policymakers that SMEs are a crucial part of the skills system and to urge them to break down the barriers that hold SMEs back from engaging.

We are grateful to have the backing of a broad church of supporters including the Recruitment and Employment Confederation, Amazing Apprenticeships, the Association of Apprentices, Specsavers, the Co-Op Group, and City and Guilds. Using our collective voice we can achieve a genuine hat-trick: an apprenticeship system that works for young people, works for SMEs, and boosts the economy.

Subscribe here to our daily newsletter roundup of Labour news, analysis and comment– and follow us on Bluesky, WhatsApp, X and Facebook.

Share your thoughts. Contribute on this story or tell your own by writing to our Editor. The best letters every week will be published on the site. Find out how to get your letter published.

• SHARE: If you have anything to share that we should be looking into or publishing about this story – or any other topic involving Labour– contact us (strictly anonymously if you wish) at [email protected].
• SUBSCRIBE: Sign up to LabourList’s morning email here for the best briefing on everything Labour, every weekday morning.
• DONATE: If you value our work, please chip in a few pounds a week and become one of our supporters, helping sustain and expand our coverage.
• PARTNER: If you or your organisation might be interested in partnering with us on sponsored events or projects, email [email protected].
• ADVERTISE: If your organisation would like to advertise or run sponsored pieces on LabourList‘s daily newsletter or website, contact our exclusive ad partners Total Politics at [email protected].