ISE’s Student Development Survey reveals how employers are using the apprenticeship levy in 2024.

While there are reports of plummeting apprenticeship numbers and annual government figures show a 3.5% reduction, how are ISE members using the levy?

ISE’s Student Development Survey 2024 reveals some emerging trends in apprenticeship programmes and how the levy is being used.

Spending the levy

This year, respondents reported that they were spending on average 41% of their apprenticeship levy which is a slight decrease on the previous year (45%) – a drop in line with the annual government figures.

However, the percentage of the levy that was spent differed between sectors, reflecting the different sectoral histories of engagement with apprenticeships.

The sector that used most of the apprenticeship levy was the Built Environment which spent 69% of the levy, whereas the Health & Pharmaceuticals sector and Retail, FMCG & Tourism sector spent 25% of the levy respectively.

In our sample, a significant proportion (90%) of organisations are offering apprenticeship programmes for school and college leavers.

Additionally, more than half of organisations provide apprenticeship programmes for graduates (54%) and existing hires (60%) but only 38% of organisations extend these programmes to newly recruited experienced hires.

The apprenticeship programmes delivered were at a range of different levels with Level 3 and Level 4 being the most predominant ones for school and college leavers, whereas Level 7 was the most predominant one for graduates and existing hires.

Fewer apprentices

The average apprenticeship enrolment rate for school and college leavers and other non-graduate entry-level starters in 2023 was 67%. Compared with the previous year (79%), this has decreased by 12 percentage points.

As noted above, this fits with wider market trends, yet we also found that drops are larger in lower-level apprenticeships while degree and Level 7 apprenticeships increased.

This may mean that ISE members are placing increasing emphasis on utilising apprenticeships to develop more advanced levels of skills in their early career hires than in previous years.

The level of engagement with apprenticeships varied across sectors. The majority (83%) of school and college leavers hired by Finance and

Professional Services and Built Environment sectors were enrolled on an apprenticeship, compared to 37% of school and college leavers from Retail, FMCG & Tourism sector respondents.

Similar sector trends can be seen in how apprenticeships are deployed for graduate development, with 40% of graduates in the Finance and

Professional Services sector being enrolled onto an apprenticeship programme, compared to just 2% of graduates in the Digital and IT sector.

Developing new and existing staff

Respondents reported that 31% of people, on average, enrolled on their apprenticeship programmes are existing staff (similar to 28% last year).

This varied across sectors, however, with 54% of existing staff from the Retail, FMCG & Tourism sector enrolled on apprenticeships, whereas only 14% of existing staff from the Built Environment sector enrolled on an apprenticeship in the same period.

For alternative hires such as ex-military, career-changers and ex-offenders, respondents reported that 12% of these hires were enrolled on apprenticeship programmes.

Most (91%) respondents used an external apprenticeship provider to deliver their apprenticeship programmes. Only 20% of respondents delivered apprenticeship training themselves as an employer provider.

Read the report for full sector breakdowns.

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