The role of apprenticeships in filling the skills gap

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Not a day goes by without some reference to the skills gaps in the rail industry. Numerous organisations continue to report difficulty finding qualified people to fill vacancies created by experienced staff moving on or to support growth and expansion within their business – and the next few years look set to get even tougher as the age profile across the industry really starts to bite. So how might apprenticeships help?

Shared apprenticeships

The Rail Forum Midlands (RFM) has been asked to lead some work as part of the Rail Sector Deal to stimulate the uptake of apprenticeships across Midlands-based rail companies through the development of shared apprenticeship schemes. 

“Whilst the concept of shared apprenticeships has been around for some time, we are keen to explore several options that might work for our supply chain companies and SMEs in particular, so we have no preconceived ideas about what a shared scheme might mean,” said Elaine Clark, chief executive of RFM. “It may be simply sharing a cohort of students that go to college together; or it could mean providing an apprentice with several different work placements across different employers to provide broader work experience. It could also mean a third party employing the apprentices on behalf of the SMEs, but only if we can guarantee a quality experience for the young people undertaking their apprenticeship.”

RFM is currently gathering views from a range of employers to understand the current challenges and barriers for SMEs recruiting apprentices and to gauge the level of interest in some of the key apprenticeships available. 

Change

“Apprenticeships look very different now compared to what colleagues across the industry may remember from when they completed their training – perhaps many years ago!” Elaine added. “To be classed as an officially recognised apprenticeship, certain criteria have to be met – an apprenticeship is a real job with a recognised training programme; combining knowledge, occupational skills and behaviours structured around the specific occupation or job role. 

The knowledge (or academic) elements of the apprenticeship are normally delivered by a college, private training provider or a university; this is known as off-the-job training. The occupational skills and behavioural elements can be a mixture of off-the-job; learning new skills in a safe environment, and on-the-job experience; supported in the workplace, by the employer. This skills development often leads to some form of competence assessment process.”

Apprenticeships are available in many occupations from basic entry level, right through to post graduate degrees. Whilst ‘degree level’ apprenticeships are relatively new, they are already proving popular with students and employers alike; providing the opportunity to gain real work experience alongside academic studies.

One of the key things about all apprenticeship standards is that they are developed with significant input from employers. Rail sector specific standards exist for a range of occupations that are relevant across infrastructure, rolling stock and operations, however the nature of the industry means that standards developed in other sectors such as manufacturing, IT, finance, management and so on, will also be relevant to many employers. Navigating the different options can be off-putting but working with a local training provider can help identify the best standards for a particular role. 

All apprenticeships have a minimum duration of 12 months and some will run for up to two or three years. While apprentices must be aged 16 or over, they don’t have to be new recruits, so an apprenticeship can be used for upskilling the existing workforce.

Funding

Elaine added: “One of the common obstacles is often funding; or rather the lack of understanding of how funding works. All apprenticeships are allocated to a funding band, this sets out the amount of funding available to pay for the basic apprenticeship. The funding may come from an employer levy account or direct from government for smaller employers.” 

Since April 2017, employers with a pay bill of over £3 million a year pay an apprenticeship levy based on a percentage of their pay bill. In England, the government tops up the employer levy with an extra 10 per cent, this is paid directly into the employers’ apprenticeship account. If your organisation is too small to pay the levy, the government will pay 95 per cent of the cost of the apprenticeship, up to the maximum funding band for the specific apprenticeship standard, with the employer paying the final five per cent.

As of April 1 this year, levy-paying employers can transfer a maximum amount of 25 per cent of their annual funds to other employers, such as those in their supply chain. They can make transfers from their apprenticeship account to as many employers as they choose.

Transferred funds will be used to pay for the training and assessment cost of the apprenticeships agreed with the receiving employer. Whilst this facility is still very new, it’s something RFM will be looking at more closely as it develops its shared apprenticeship workstream, to ensure smaller employers are taking advantage of unused levy paid by larger companies in the industry. 

“The industry is going to need a lot of new people over the next five to 10 years and larger public sector contracts are now demanding a certain number of apprentices per million-pound spend to encourage everyone to do their bit,” said Elaine. “We need to address the barriers that SMEs face and our shared apprenticeship workstream will help address some of these issues.” 


To find out more about RFM’s sector deal apprenticeship workstream, contact elaineclark@midlandsrail.co.uk.

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