Adaptability of the workforce is critical. That is the view of the World Economic Forum, which believes it “pays to enable the workforce to contribute to the technology revolution and to be able to cope with its disruptions”.

Advent of artificial intelligence (AI) and the fourth industrial revolution are bringing changes to the economy and the future of jobs, while employees simultaneously face extended working lives.

“There is a perennial need for businesses to address skills and productivity issues, and the government’s post-Brexit ambitions for a globally competitive and balanced economy, requiring a highly skilled, innovative and entrepreneurial workforce,” explains Professor Chris Rowley, expert in human resource management at Cass Business School, City University of London and Kellogg College, University of Oxford.

He points out that lifelong learning is “even more vital with changes such as AI”, adding the 2019 Centenary Commission on Adult Education report argues for a national adult education and lifelong learning strategy in the light of a 45 per cent dip in funding over the past decade.

Incremental skills acquisition

As the nature of jobs evolves, incremental acquisition of skills over a person's career is likely to be fundamental to ensuring job security, business productivity and growth.

Dan Lucy, principal research fellow at the Institute for Employment Studies, believes there has been “a resurgence of workforce planning because of the technological change taking place and the perceived disruption”.

“Mapping the type of work and skills needed, along with having an extensive learning programme and mentorship programme, is very powerful for employees and organisations, which can fill their skills shortages internally,” he says.

The talent continuum is a holistic approach for unlocking human potential in a perfect storm of technology

There are many ways businesses can support workforce development. While this can include external or online training courses and help with study, it can also involve less formal upskilling, through shadowing more experienced staff, temporary moves to different parts of the organisation to learn new skills, or provision of a mentor or coaching sessions.

In Randstad Sourceright’s 2020 Talent Trends Report, the global human resources consultancy highlights the need to focus on the talent continuum, defined as the unending process of evolving the competencies of employees to complement technological innovation. 

The company’s chief people officer Cindy Keaveney explains: “The talent continuum is a holistic approach for unlocking human potential in a perfect storm of technology.”

Investment in upskilling

At Amazon, the business recognised the urgent need to help its workers upskill in announcing a $700-million (£541-million) training investment last July.

As part of Upskilling 2025, Amazon launched training opportunities for 100,000 of its US employees whether they work in an office, warehouse or are out on the road making deliveries.

Among initiatives are its new academy to equip non-technical Amazon employees with skills to transition into software engineering careers, while a Machine Learning University will train thousands of employees in those higher skills.

And it’s not just global corporations leading the way. At construction business Willmott Dixon, ranked fourth in the 2020 Sunday Times Best Companies to Work For list, the concept of lifelong learning and upskilling is embedded in its culture. 

The business spends more than £2.5 million each year on training its 1,700 staff, where each employee with five years’ service is eligible for a £750 personal learning fund to acquire any new skill they wish.

Kate Jansen, director for organisational development and learning at Willmott Dixon, reveals its employee turnover is below 6 per cent, a figure she puts down to a “learning ethos deep rooted in our core”.

“Many of the jobs of the future haven’t been defined yet and one strategy we adopt is to prepare our people for exactly that: the unpredictability,” she explains.

“This means ensuring there is a readiness for change in the business. We have teams investigating [future business needs] and preparing us. They are feeding into the learning function just how we need to adapt.”

There is no age limit on learning, with one 72-year-old employee recently completing an NVQ qualification, she says.

‘Mid-life MoT’

The Institute for Employment Studies’ Lucy adds that interventions, such as a “mid-life MoT”, can be “a proactive way of addressing some of the risks that might emerge now retirement age has increased and employees face extended working lives”.

Such upskilling within an organisation makes sound business sense, says Rowley, particularly when considering the cost of recruitment over retaining existing staff.

“There are benefits of retaining staff and developing their functional flexibility via skills investment, rather than simply poaching those with ‘oven-ready’ skills from a fixed pool, which is not sustainable,” he says.

Willmott Dixon’s Jansen agrees. “Learning and development gives a competitive advantage, and makes people happy and motivates them. It is about creating an environment where people aren’t afraid of anything new and embrace the changes that are ahead,” she concludes.

The days of apprenticeships being seen as a second-class career choice are over. Where once apprenticeship schemes were seen as inferior to graduate programmes, savvy employers have beefed up their apprenticeship offering, citing the ability to develop work-specific skills and increased loyalty from recruits as benefits. 

With Brexit, the fourth industrial revolution and changing demographics all impacting the labour market, apprenticeships offer a new way for employers to bring in skilled, motivated talent.

The government encouraged this change in perception by introducing the apprenticeship levy in April 2017, which forced employers with a payroll of £3 million or more to set aside 0.5 per cent of their budget for apprenticeships. Businesses with a payroll of less than £3 million could access apprenticeship training, with 90 per cent paid for by the government. 

The aim was to create three million apprenticeships by 2020. However, the latest government figures show that target is increasingly likely to be missed, with the number of people starting an apprenticeship between August and October last year falling to 125,800, down 4.7 per cent on the same quarter the previous year. Current projections suggest two million apprenticeships will have been created since the levy’s introduction. 

The levy has also faced criticism for how funding is being used, with some large organisations spending their allocation on level 7 apprenticeships – equivalent to a Master’s qualification – for senior staff, rather than recruiting and training younger employees. Other smaller to medium-level organisations seemed confused about how to access the levy, viewing it as a “stealth” tax and missing out on its benefits. 

Recruitment boost

Despite this, many businesses have seen a boost in apprenticeship numbers and a culture shift in how trainees are viewed. 

BT is one organisation that has embraced apprenticeships. In the year after the levy was introduced, BT tripled its apprenticeship intake from 350 to 1,100. This year, the number has quadrupled, with the telecommunications giant now offering 70 different apprenticeship programmes from level 2 up to level 7.

According to Ann Potterton, BT’s head of apprenticeships, more than 80 per cent of the organisation’s apprentices are still with the business and over half have had at least one promotion since 2017.

“We’re particularly proud that of the 9,000 apprenticeship roles across our business since the 2017 reforms, 23 per cent were filled by people from deprived postcodes, supporting the government’s social mobility aims,” she adds.

There has never been a better time to make the investment of time, effort and resources to employ apprentices to build your workforce of the future

BT has been something of an apprenticeship trailblazer, having run programmes for more than 60 years. According to Potterton, senior staff up to managing-director level are graduates of BT’s apprenticeship schemes, which are fully integrated into the organisation’s workforce planning. This allows BT to identify gaps and challenges, which can be filled by apprenticeship schemes, saving money on down-the-line recruitment. 

“Apprenticeships are getting ever broader, both in terms of the types of career and level of qualification. There has never been a better time to make the investment of time, effort and resources to employ apprentices to build your workforce of the future,” she insists. 

New focus

Another organisation making full use of the apprenticeship talent is insurer Axa. In 2018, it took the radical step of scrapping all but one of its graduate schemes to focus on strengthening its apprenticeship programmes, for both new recruits and existing employees. 

“The apprenticeship levy has allowed us to offer a more diverse range of apprenticeships to people of any age and from a multitude of different backgrounds,” says Dawn Keijzer, Axa’s apprenticeship and professional qualifications manager. 

A significant way Axa has integrated apprenticeships into its workforce planning is by analysing where it has high workforce attrition rates and using apprenticeships to attract employees who want long-term careers in those areas. By demonstrating a return on investment, the entire organisation has bought into the value of apprenticeship programmes, says Keijzer. 

“This enables us to not only forge the skills we need for the future, but also to do it with people who are committed to progressing their own development with us,” she says.

“The same applies to critical skills gaps. We use apprenticeships to develop our people with the skills they’ll need to be prepared for emerging technologies that will reshape business and the wider society.”

There’s no doubt that the image of apprenticeships is changing, providing new skills and more diverse talent in the workforce. But with continuing concerns over how the apprenticeship levy is being spent and a lack of continuity in progressing through different apprenticeship levels, is it changing fast enough?

Paula Gibson, strategic commercial manager, and Bryony Kingsland, head of funding and policy, both at City & Guilds Group, explain.

What are the challenges facing organisations when it comes to the apprenticeship levy?

Paula: Some employers are finding it challenging to utilise all their levy. Recent research shows that employers are using around a third of it whilst unspent levy funds expire and end up back with the Treasury. Many employers also struggle with evolving funding changes, which makes it increasingly difficult to convince internal stakeholders to fully use the funds to upskill existing staff.

Bryony: There are a variety of challenges affecting all parts of the system. For small employers, the bureaucracy associated with setting up their business on the Apprenticeship System, and managing the entire apprenticeship starts process, is onerous and resource intensive. For providers, delivery to SME’s, often rurally based, costs far more than some funding bands provide. In the words of a DfE Accountant at a recent Westminster event “a provider would have to pay their tutors less than the minimum wage to deliver apprenticeships to a rurally based SME.” IfATE are consulting on apprenticeship funding bands currently, but the initial consultation published looks likely to result in cuts to some funding bands, which will increase the challenge of delivery to SMEs and rural areas.

The availability of Level 2 entry level pathways for 16-18 year olds into an office environment, particularly the 40% of young people who leave school without a full Level 2, are very limited. There are 119 Level 2 apprenticeship standards with only five available for office orientated pathways. Whereas at Level 3, there are 187 standards with 28 in office based pathways. Without those Level 2 entry pathways, many 16-18 year olds will be left with little chance of moving into their first employment role, increasing the NEET cohort year on year, costing the government in funds for unemployment support and decreased income tax. Organisations such as NHS trusts rely on a Level 2 intake for their clerical roles, which provide employment for those disadvantaged young people that may never be able to progress past a Level 2 qualification. Often employers are unable to provide a job role that would support the delivery of the Level 3 Business Administration standard. When the Business Administration Level 2 Framework is removed in July this year, it will leave a massive gap in opportunities for 16-18 year olds and for many employers, now that IfATE have refused approval for a Level 2 Business Administration standard. IfATE state they are an employer-led organisation, but many employers do not feel that their voice is being heard or their workforce skills needs being met by the reforms.

Has there been enough clarity on apprenticeships for business?

Paula: Despite the levy being introduced in 2017, there are some employers that still are unclear on how to use it! In some cases employers have established their own internal dedicated apprenticeship teams, but for some employers, without the knowledge of the system and all its complications around funding bands and constant changes to policy and fund rules, its often really difficult for employers to find the time to engage with the system and start to use their levy funds. Operational priorities will always take precedence.

Bryony: Many apprenticeship standards have had very little input from SME into their design, making them unfit for all but a limited selection of larger employers.

Workplace skills are changing at an exponentially greater speed each year, with automation and 4IR continuing to affect the skills needs in many sectors over the next decade. Standards can go out of date very quickly as a result and the process for agreeing or updating standards does not appear to be as straightforward, rapid or broadly employer led as it could be. We need a fleeter, less bureaucratic and government influenced system that is truly employer-led involving all employers, regardless of size.

Has the perception of apprenticeships changed?

Bryony: Perceptions are changing but reform and culture change takes time. With the challenges of bureaucracy in the system, the needs of all employers not truly being taken into account there are concerns in the sector that progress may stall. There has been a culture for the last 15 years of degrees being the best opportunity for a successful career. This is changing but there are still major glitches in the system that need to be addressed. Careers advice in schools is still biased towards university. This is not helped by a system that funds schools to keep young people at school taking A levels and head teachers' salaries being linked to the number of pupils in their school. Governments have a responsibility to ensure schools give a broad range of unbiased advice on careers, including apprenticeships. We talk to a lot of employers and they frequently tell us they try to speak to schools about apprenticeship routes but are refused access, or only given access to a limited cohort. At a recent employer event run by City & Guilds and ILM, we were lucky enough to have two work experience young people attending with their employer. One of them told us that when she suggested to her teacher that she would be applying for an apprenticeship route in preference to a degree, her teacher stated that she was ruining her life and career by doing so. This perception is outdated and totally unacceptable. Schools need support to update their staff on developments and legislation that enforces the right to unbiased, broad ranging and up to date careers advice for all pupils.

Some organisations have scrapped graduate schemes in favour of apprenticeships; what are the benefits?

Bryony: Employers who have moved training to apprenticeships talk about the motivation, productivity and sheer innovation apprentices bring, alongside increased staff retention. Many young people are also beginning to understand that a degree apprenticeship will put them in a much better position on graduation than some academic graduate programmes. There is room for both types of degree programme, depending on the occupation, sector or career the young person is aiming for. But where a degree apprenticeship is a feasible option for study, the outcome for the employer is an employee who develops new knowledge and skills and also has the opportunity to apply those in a workplace setting. Degree apprentices gain a level of workplace maturity alongside the softer skills, such as collaboration, creativity, adaptability and analytical skills that so many employers are struggling to find when recruiting new, younger employees.

There are bigger issues when you talk to SMEs enterprises. They often cannot see the benefits due to the bureaucracy, the resource implications and the cost. Many are writing off levy contributions as a tax. We need apprenticeship ambassadors talking to SMEs about the benefits for them and a system that works for SMEs as well as larger employers.

Are business missing a trick by not targeting apprenticeships at middle management?

Paula: We have seen a soar in the number of management apprentices since the introduction of the levy in 2017. This shows that many employers are using their levy to upskill existing staff to become better managers and leaders. There is clearly an opportunity to use levy funds to improve management capability given that for some employers very little or no formal management training has taken place hence the rise of the “accidental manager”. However, employers need to be recognise that some of these management programmes are lengthy in duration (Chartered Management Apprenticeship at Level 6 is four years) employees and line managers need to know what is expected for example time required to produce assignments plus block release to attend study days. For this reason, employers need to ensure that a management apprenticeship is the best route to address skills gaps.

Bryony: We’ve seen year on year cuts to adult funding that have resulted in a serious skills deficits in what is an aging workforce. The apprenticeship levy is helping to address some of the issues but will not solve all of them. Many employees are not suitable for or able to access an apprenticeship, so there is a need for funding for other types of learning for middle managers and older workers. The Adult Education Budget (AEB) is far too bureaucratic and difficult for providers to spend due, in part, to the restrictive eligibility criteria. Many employers do not even know AEB exists as an option to fill those gaps in skills that apprenticeships cannot address. However, the levy is supporting employers to upskill middle management, and this will remain an important aspect of levy spend to ensure the workforce of tomorrow is able to meet the challenges of automation and change.

How can managers better support apprentices?

Bryony: A large proportion of the support for individual apprentices is gained from their managers and the staff around them. A lot of on-the-job training comes from within an organisation. However, many managers are unskilled themselves in mentoring or coaching their teams and apprentices. Support and training for supervisors and managers who have apprentices in their department is equally as important as the training of apprentices. Mentoring and coaching qualifications can make a massive difference here as managers gain important skills for their role and are better able to support their apprentices through to a quality successful outcome. Training for staff supporting apprentices can increase staff wellbeing, help staff feel valued alongside their apprentice and leads to improved productivity across the department.

Paula: We recommend effective internal coaching and mentoring strategies to help the apprentice stay motivated during the programme. Mentors can also support with ideas for work assignments. They can also play a pivotal role in identifying ideas for work-based assignments that demonstrate a direct impact on performance improvement within a function. This is also a great way to create stakeholder buy-in as start to how apprentices are having a direct and positive impact on the business.

How can HR get buy-in from leaders?

Paula: To get buy-in from your senior leaders it’s critical to engage from the top tier; presenting clear and concise information to your senior leadership teams combined with the opportunity and the financial return on investment can support the business case. 

The government envisaged the introduction of the apprenticeship levy would be an entry-level game-changer, but most of the levy is spent on existing staff. Therefore, this has to link into the People Plan for the business that is across the organisation to really map how apprenticeship training can help to upskill your existing staff and to consider if will address those gaps now and for the future. It is also important that apprenticeship training isn’t used to solve competency problems in the workplace; this will create more work and challenges further down the line. Employees need to buy-in to the apprenticeship training and understand exactly the expectation.

The final point is to agree how you are going to measure the success of the programme; how can you link into business KPIs so increased employee satisfaction, business improvement measures etc. Set a timescale to review which is usually around 6-12 months into the programme.

When Simon Brown, chief learning officer at Novartis, decided to ask staff how the company could help them, he was blown away by the response as more than 10,000 replies flooded in.

“The message coming through loud and clear was that there was much more desire for continual, lifelong learning,” he says. Cue the company’s reaction: a pledge to invest £100 million over the next five years to encourage just this, with a broader aim that each staff member spends at least 100 hours, or 5 per cent, of their time at work learning.

While training is a perennially popular perk, there’s something about the current business landscape that arguably makes it feel doubly desirable, perhaps even urgently so. At a time when dire predictions about the impact of automation and artificial intelligence (AI) abound – the Office for National Statistics recently predicted 1.5 million jobs will be lost in the UK alone in the next few years – there appears to be a palpable panic among workers that their future prospects remain in doubt without upskilling.

Job fear is replacing job security

Numerous studies are now arriving at the same conclusion. City & Guilds Group’s Missing Millions research finds just a third of people say they feel confident about their career prospects, with a quarter feeling either fairly or very negative.

It corroborates research by job search engine Adzuna, published in the New Year, which found 46 per cent of workers feel they don’t have the skills or capabilities to be able to hold down their jobs. It found Cardiff was where 60 per event of people felt least secure with their skills.

With 42 per cent of all jobs now high skilled, up 13 per cent between 2011 and 2019), both studies unequivocally conclude people want workplace learning to brighten their outlook, if only to impart confidence they have the ability to adapt and respond to the changing nature of work.

“The half-life of people’s skills is probably only about five years now,” says Brown. “It’s vital we as a business create a culture of learning, what we call curiosity. But it’s equally important employees embrace it and take charge of their learning too.”

Quelling fears

Deborah Exell, former global senior vice president, performance and change, at the Coca-Cola Company, says: “The impact of AI probably won’t be as fast and deep as people think, but if that’s people’s perception, then it’s what employers have to deal with to quell these fears.”

Providing learning does more than soothe worried brows; it’s proven to boost retention, loyalty and engagement too. “We have staff attrition levels of 15 to 20 per cent,” says Marcus Watson, chief executive of Ground Control, one of the UK’s largest suppliers of maintenance services, with 1,000 direct employees and 5,000 contractors. “Of those who chose to take our development paths [it offers 60 different courses on everything from basic IT skills to leadership, even MBAs], this drops to just 5 per cent.”

So fervent is his view that learning boosts people’s confidence, as well as potential capacity, that learning is extended to contractors. He adds: “We also provide what we class as aspirational development, which is directly aimed at people who tend to feel the most marginalised, such as those with historically low academic achievement.”

Perhaps more employers should take a leaf from his book. The Missing Millions research suggests employees from lower socio-economic groups, and women in particular, have much less confidence in their potential for career progression. Provide them with skills, however, and the research shows 55 per cent will feel more resilient about their future careers. 

Millennials

“Failure to do this, will only cause more people to feel like they’re being superseded, especially when mid-career people see millennials coming into the workplace who shape their roles to their skills and vice versa,” says Murray Morrison, founder of Tassomai, which provides a technique that helps students achieve better GCSE results. “Job fear is replacing job security.”

Of course, a barrier to all this is many employers are still not investing in, or providing access to, enough lifelong learning, despite bemoaning skills shortages. According to 2018 research by the Chartered Institute of Personnel and Development, a quarter of the workforce hadn’t received any training in the last 12 months.

As Exell says: “Ask many a CEO what their view is on continual learning and they’ll say ‘how does it tie in to my strategy?’.” 

But if there’s one thing AI is at least doing, it’s creating the data and the links between learning and productivity and innovation. Which leaves companies “creating and fostering learning cultures, where people can see for themselves how learning links to promotion, or more engaging and interesting work”, says Jo Taylor, former director of talent and resourcing at TalkTalk Group, now boss of Let’s Talk Talent. 

“People might be tremulous about the way their jobs might change, and whether they have it in them to respond, but the one thing you definitely can’t do is scare people into learning,” she says.

“Great companies simply explain what someone’s job is likely to be and that if they want to stay relevant, they’ll give them the tools they need, as long as they understand development is a responsibility which lies with them too.”