Apprenticeship levy causing small businesses to shun apprentice recruitment

The introduction of the apprenticeship levy has had a negative impact on small businesses even though many are not required to pay it.

The Federation of Small Businesses (FSB), found that small businesses view the system of apprenticeship levy as costly and inflexible and that it causes problems recruiting apprentices. 

Out of 1,665 small businesses surveyed, 27% of those that employed apprentices both before and after the levy system came into effect said the changes had a negative impact More than one in four reported that costs related to recruiting and training apprentices had increased.

The Government has already reported a drop in the  numberof small businesses which engage apprentices and this has had a knock on effect of school leavers choosing apprenticeships as a progression into work.

The FSB has called for small businesses to be given more control over how non-levy apprenticeship funding is used through the government’s Apprenticeship Service, and for a “matching service” to be created to support levy-paying organisations to find small businesses to make use of their unspent funds.