3 key takeaways: The cost of living and the future of apprenticeships

Last week, the third live show in our #FutureOfApprenticeships series with FE News took place, focusing on the topical issue of the cost of living crisis and its impact on apprentices, their parents and employers. 

Titled “Supporting apprentices through the cost of living crisis and beyond”, episode three featured an impressive panel of expert speakers: 

• Gavin O’Meara, Founder and CEO of FE News 
• Michael Lemin, Head of Policy at NCFE 
• Aidan Relf, Skills Consultant  
• Becci Newton, Director of Public Policy Research at the Institute for Employment Studies. 

Here, we recap three key takeaways from the discussion.

1. Pressure on all involved

As Michael outlined at the beginning of the episode, one of the biggest impacts of the current cost of living crisis on apprenticeships is the pressure being put not just on the apprentice, but on all involved in the end-to-end journey. 

There’s pressure on employers to not only create apprenticeships and work placements, but to also deliver these to a high standard at a time when increased business costs and rising energy bills are putting a strain on many organisations – particularly on SMEs – outlined Aidan. 

There is also a difficult decision to be made by the parents of 16-19 year olds who are considering starting an apprenticeship and may subsequently lose out on receiving incoming child benefits as a result of the overall household income rising.  

And, of course, there’s pressure on apprentices themselves, many of whom are receiving the apprenticeship national minimum wage rate at a time of increased costs. 

Explains Becci: “Right now, if you’re going to stay on the apprenticeship minimum wage rate until the age of 19 – compared to if you’re in a non-apprenticeship job and you can get a better wage rate at the age of 18 – I think we could see more non-completion as more young people follow the money because their circumstances really require that they do in this rising inflationary context.”

2. Finding solutions

The above concerns are not easy ones to resolve – but discussion by our panellists did consider possible and potential solutions to these pressures. 

Using an idea from the article she recently contributed to the Campaign for Learning’s pamphlet titled “Learning in the Cold: The Cost-of-Living Crisis and Post-16 Education and Skills”, Becci outlined how important research into the living situations of 16-19 apprentices and their household income is.  

Discussing this group being the likely recipients of the £4.81 per hour apprenticeship national minimum wage, Becci explains: “This is done on the assumption that they are living in a household with parents or carers who can afford to support them – but we really don’t know how far that is the case. It’s really hard to understand who this group of young people are. 

“The kind of risks involved in those different financial levels and different pay rates are quite great and I really think we need to understand much more about this group of people [through research].”  

As another possible solution, Aidan also outlined the possibility of getting rid of the apprentice rate altogether, and whether this could instead be pegged to the youth rates recommended by the LPC.

3. Reputation, quality and incentives 

Becci highlighted another important point relating to the apprenticeship minimum wage, suggesting that young people may be questioning the quality of apprenticeships and what they will ultimately get out of it as a result of the low pay. Aidan agreed, suggesting that the discussion around the minimum wage often provides an unwelcome distraction and is at risk of dragging the reputation of the programme down. 

Plus, there was also a question from an audience member about what quality non-financial incentives may exist to entice young people into considering the learning path of an apprenticeship – another important point to consider as the discussion around the minimum wage continues to be a sticking point. 

Want to hear more from our panel as they explore topics such as the impact of the cost of living crisis on off-the-job training? Watch the full episode below:   

Be sure to join us for our fourth episode on apprenticeships and learners with SEND at 10am on Thursday 10 November by tuning in on the FE News YouTube channel. You can also join in the discussion using #FutureOfApprenticeships on social media.