The new levy, which comes into effect 6 April 2017, requires all employers operating in the UK, with a pay bill over £3 million each year, to invest in apprenticeships.
According to Steve Hill, external engagement director at The Open University, the levy arrives as the
“frustrating effects of ineffective management” are being felt across the UK economy.
Moreover, Hill points to a management skills gap that urgently needs filling.
In an op-ed to Chartered Institute of Personnel and Development (CIPD) Hill pointed to statistics which show that poor management is estimated to cost UK businesses £84b per year
Meanwhile, just 14% of businesses surveyed for Deloitte’s 2016 Human Capital Trends report
said they would describe their leadership succession planning as ‘strong’.
“Perhaps these results should come as no surprise, given the challenges involved in developing managers and leaders,” he wrote.
“Compared with some of the more technical skills that organisations are also expecting shortages of, the capabilities of an effective leader tend to be more strategic, high level and people oriented.”
He said that traditional models of training are “particularly unsuited to this development need”, adding that management theories that are not immediately tried out in practice can “often become the sort of ‘inert’ knowledge that fails to add any value”.
“This is where the degree apprenticeship as a model of L&D comes into its own,” he said.
Hill suggested that by blending academic study with workplace activity, the apprenticeship has the goal of making training relevant to employment. Additionally, less time away from the workplace for learners ensures there is no overall dip in capacity while training takes place.
“With the apprenticeship levy coming in April 2017, these practice-based L&D solutions can be directed towards the UK’s management skills gap,” he wrote.
“Under the new rules, the levy can be used to deliver training to each and every layer of an organisation, allocated towards the areas of greatest need.”
He pointed out that with 69% of UK employers expecting to need more people with management skills in the coming years, there is a real challenge for decision-makers to put adequate succession planning in place.
“The upcoming apprenticeship levy has the potential to empower L&D professionals with a new tool to unlock management capability in their workforce,” Hill said.
“This opportunity does mean that businesses need to understand where current and future skills needs will occur within their organisation, but, once this is identified, degree-level apprenticeships will offer them a very credible solution to their challenge.”
Upcoming changes to apprenticeship funding could give L&D professionals a powerful new tool to combat management problems.