The UK government’s instinct that the Apprenticeship Levy needs reform is accurate, but its proposed changes are flawed and a step back for gender equality, explains Julie Rosborough, Deputy Head of Postgraduate Education and MBA Course Director at Nottingham Business School, Nottingham Trent University
British firms have long voiced concerns that the levy’s restrictive focus on traditional apprenticeships blocks them from investing in alternative forms of training that might better suit their needs. At the same time, a drop of almost 40 per cent in apprenticeship starts since 2015-16 among those aged under 25 suggests a failure to provide compelling learning opportunities for young people.
In response, the government has announced plans to rework the levy as a “Growth and Skills Levy”, which grants employers more flexibility in the types of training they can invest in. So far, so good.
However, the reforms also propose a reallocation of funds away from level 7 apprenticeships towards lower-level apprenticeships. The aim is to support skills gain among young adults on the cusp of entering the workforce, and perhaps to reconcile the Department for Education’s dwindling budget with the fact that higher-level apprenticeships are typically more expensive to deliver.
Speaking at FE Week’s annual Apprenticeships and Training Conference in March, Skills Minister Jacqui Smith said fiscal constraints mean the Department for Education must make tough decisions.
“We have to prioritise,” she said.
The problem is that, while foundation apprenticeships are an important way to help young people launch their careers, the government’s announcement fails to consider how significant the wider social benefits of senior leader apprenticeships are.
Boosting productivity through Level 7 apprenticeships
Level 7 apprenticeships are designed to offer a blend of practical experience and academic study that equips individuals to thrive in management and leadership roles. Participants have usually already started to build their careers and are considering how to translate the experience they have gathered into the next stage of their professional growth.
So, the training and support they need is radically different to the kind offered by lower level apprenticeships, which typically focus on young people with little to no prior career history.
The UK already suffers from a lack of this type of leadership training, with Ann Francke, chief executive of the Chartered Management Institute (CMI), issuing a warning in 2023 that the need for more highly skilled managers had been “dangerously overlooked” by ministers for two decades.
Government support for robust leadership training schemes contributes to a more productive and equitable society. For example, funding level 7 apprenticeships could contribute to lessening the UK’s productivity gap.
As a measure of economic output per hour worked, productivity in the UK is almost 40 per cent below the US and 20 per cent below other major European economies such as France and Germany. Looking ahead, the Office for National Statistics shows this situation is unlikely to improve in the near future.
Yet, an evidence review published by Government Skills finds significant evidence that “management training programmes are, on average, effective at improving outcomes, including the quality of management practices and organisational productivity.”
So, allocating funding for senior leader apprenticeships could help to spread management best practice, improving efficiency and productivity in both private and public sector organisations, and contributing to the country’s productivity as a whole.
Shrinking the gender gap through education and apprenticeships
Senior leader apprenticeships also enable groups that typically struggle to access leadership training to do so. For instance, women only comprise 39 per cent of the current student cohort globally for MBA (Master’s of Business Administration) programmes.
First introduced over a century ago in the US, the MBA has become the globally recognised flagship programme in management education. Uneven gender participation signals that fewer women than men are receiving the type of credentialled learning that could empower them to ascend into more senior roles.
So, how do senior leader apprenticeships help?
Part of the reason for this gender disparity in graduate education could be the additional financial pressures women often face when considering whether to apply and enrol for an MBA. Women may have to consider how potential career interruptions due to maternity leave and caring responsibilities, as women shoulder more caring responsibilities for children and the elderly on average than men, could affect the return on investment of studying an MBA.
Indeed, a study by the Graduate Management Admission Council (GMAC) found that 88 per cent of female candidates indicated that the cost of business school significantly impacts their application and enrolment choices.
Providing financial assistance towards the cost of management training could help to reduce this disparity by alleviating these additional pressures on female candidates.
Level 7 apprenticeships do exactly this. Because they equate to 120 credits of a Master’s level degree, they are used by many business schools as a way to progress to an MBA which reduces the financial burden of these qualifications on students and enables more equitable access to management training.
In my role as the Deputy Head of Postgraduate Education at Nottingham Business School, Nottingham Trent University, I have observed this trend first hand.
NBS witnessed a significant increase in the number of women enrolling in its MBA programme following the introduction of senior leader apprenticeship funding. 52 per cent of the current cohort is now female, striking much closer to gender parity than the global average, which is around 42 per cent.
This trend is a promising step towards addressing the long-standing issue of women being underrepresented in leadership roles across multiple sectors. MBA programmes are traditionally designed to train specialists to enter senior leadership roles, catering not just to the typical business and finance sectors, but also contributing to fields as diverse as technology and healthcare, where women continue to be underrepresented.
For instance, in 2024, just nine CEOs in the FTSE100 were women. Yet, while the executive teams leading big businesses have long been stereotyped as a “man’s world”, areas with greater female representation also show a stark imbalance. Britain’s National Health Service (NHS) employs a workforce of 1.3 million, more than 75 per cent of which are women. Even so, only 37 per cent of senior leader positions are held by women.
So, greater parity in leadership training is crucial because it offers a pathway to reducing the gender pay gap by ensuring women have the skills they need to fulfil their career ambitions.
The need for reform: Cutting public funding is not the answer
At NBS, our MBA students are usually in their late 30s, juggling demanding jobs and caring responsibilities. The time and support provided by senior leader apprenticeship programmes enable them to undertake a transformative leadership qualification and, in turn, contribute to a more productive and equitable workforce.
While the government’s desire to improve skills gain among younger adults is also vital for the national economy, not to mention the futures of young people, it should not come at the cost of cutting public funding for other important qualifications. Senior leader apprenticeships have a positive impact on the economy and society, particularly for women’s career aspirations.
Indeed, the UK government reports that 40 per cent of Britain’s economic growth since 2000 is due to more female inclusion in the workforce. Improving opportunities for women’s participation benefits national economic health overall: a rising tide that lifts all ships.
Some of these issues may already be starting to register with the government, as reports suggest ministers are considering applying an exemption for 16-21 year-olds across all level 7 apprenticeships.
Though the timeframe for these reforms is still unclear, NBS remains dedicated to empowering leaders through management training that focuses on ethical leadership, personal development, and hands-on learning opportunities with a range of partner organisations. Our MBA and Executive MBA programmes will continue regardless of whether apprenticeship funding is cut.
Amid complex global challenges such as climate change and geopolitical tension, if the goal is to foster the next generation of leaders who will invest in their societies, we must first invest in them.
