Last week saw the Department for Education release the latest round of data on apprenticeships. Importantly, this gave an initial indication of how the coronavirus outbreak is affecting participation in apprenticeships. The findings make for grim reading, with a sharp decline in apprenticeship starts in April, particularly for young people and at lower levels.
The number of apprenticeships started between 23 March and 30 April 2020 declined by 51% compared to the same period last year. However, the decline in apprenticeship starts is heavily concentrated among young people. As chart 1 shows, starts fell by 74% for those under 19, compared to 55% for people aged 19-24 and 42% for over 25s.
Chart 1: Percentage change in number of apprenticeship starts by age for 2019/20 versus the same month in 2018/19
As shown in chart 2, the decline in apprenticeship starts was not evenly spread in terms of level either, with starts at level 4 and above declining by only 2%. Conversely, starts fell by 70% at level 2 and by 53% at level 3.
The outbreak of coronavirus appears to have worsened the worrying drift of apprenticeships away from young people at lower levels, and towards older people at higher levels. As argued previously, this holds back social mobility by hoarding training opportunities among already highly paid employees. The rapid fall in apprenticeship opportunities for young people is particularly concerning as it suggests they face a double economic hit from the current crisis. Not only are they more likely to work in a shutdown sector (as shown by recent research from the IFS), they are also now less likely to be able to access an apprenticeship.
Chart 2: Percentage change in number of apprenticeship starts by level for 2019/20 versus the same month in 2018/19
Online vacancy data shows that employer demand for apprentices has fallen off a cliff since the outbreak of Covid-19 (chart 3). Vacancy postings for apprentices were 72% below their long run average in April and 81% below in May. This fall in demand for apprentices is understandable in the current crisis, with businesses having to prioritise their own immediate survival.
To reverse the decline in participation, the government should consider ways it can help businesses take on more apprentices in these difficult times. The Prime Minister has agreed to look into the feasibility of introducing an ‘apprenticeship guarantee’ for young learners, but the DfE and the Treasury should consider other ways of ensuring businesses are willing and able to take on apprentices. This could include higher levels of cost subsidisation or additional tax breaks for businesses recruiting young apprentices.
Chart 3: Monthly apprenticeship online vacancy postings
Apprenticeships provide young people with a vital route into high-skill careers. With the outbreak of coronavirus hitting labour markets hard, these routes are now more important than ever. And so, if it is to prevent a disastrous spike in youth unemployment, reversing the swift decline in the number of new young apprentices must be a key priority for the government.