Can apprenticeships drive growth in the economy?

While research suggests that many people still believe apprenticeships are more appropriate for blue-collar roles, PricewaterhouseCoopers’ Gaenor Bagley argues that service-focused apprenticeships could be the boost the economy needs.

There was mixed news for employers during National Apprenticeship Week in March. On the one hand, research from the Centre for Economics and Business Research suggested that between now and 2022, almost four million people will complete an apprenticeship and boost the economy by £3.4 billion. On the other, the Chartered Institute of Personnel and Development (CIPD) highlighted how apprenticeships still suffer from the misconception they are more appropriate for manual or blue-collar roles, and that only one-fifth of parents felt an apprenticeship had the “same status” as a university education.

More recently, there was more positive news for apprenticeships; a report published by ICM research found that higher apprentices are more employable than university graduates.

As head of people at PricewaterhouseCoopers (PwC), Bagley has been heavily involved in building and promoting the company’s Higher Apprenticeship programmes in professional services, which deliver training and qualifications in areas including business recovery, tax and consulting. PwC has also been working with more than 40 other employers in the sector, including many small and medium-sized enterprises, to promote this route as a viable alternative to university for school leavers.

Higher Apprenticeships

PwC was already one of the first major graduate recruiters to extend its recruitment pool to school leavers, having provided an A-level entry scheme for more than 10 years. When £1.5 million in funding to support new Higher Apprenticeships in the professional services sector was announced 2011, this seemed like a perfect opportunity to formalise that programme. And given that a Higher Apprenticeship offered an equivalent to the early stages of a university degree just as universities were announcing their new fee structures, this provided an added incentive to offer candidates an alternative route into a career.

Bagley explains: “We had started to recruit school leavers almost as an experiment. We weren’t very clear what we wanted them to do – should we transfer them onto our graduate track, for example? There are some areas of the business that really benefit from having school leavers on board ,and having the Higher Apprenticeship makes the programme distinctive and gives it a clear career profile.”

Just to get onto the apprenticeship, candidates need to gain a similar level of UCAS points that would grant them access to a university course.

“If you look at the calibre of the candidates, it’s astonishing,” says Bagley. “These are people that could go to university but decide not to. We’re not saying we don’t still want graduates – it’s the same talent, they’re just coming to us via a different route.”

There’s no denying PwC’s school-leaver schemes are popular – the company has experienced a rise of 318% in applications for both the Higher Apprenticeship and school-leaver programmes since the financial crisis began in 2008. Last year, the company created 30 new apprenticeship positions across its teams in London, and during 2013 will take on a further 50 higher apprentices in tax and consulting.

Raising awareness

However, raising awareness that an apprenticeship can lead to a professional career path in an area such as tax or audit is something the Government needs to work on, Bagley says.

“We run workshops with careers advisers and partner with some schools, but it would be difficult to target every school, and if we did we would only be scratching the surface,” she explains. “There needs to be more awareness of professional routes, with the emphasis on the ‘professional’. The success of the UK economy is not in manufacturing where you typically think of apprenticeships, it’s in the service industry. There is a really good story we should be telling: this is different and this will drive the growth of the economy.”

Katerina Rudiger, skills policy adviser at the Chartered Institute for Personnel and Development, agrees: “It’s not enough to convince employers that apprenticeships are a good idea, we also need to get the message out to potential candidates and their parents that apprenticeships are a good route into skilled jobs. Many young people report that they have had no or very little advice and guidance about apprenticeships.”

For PwC and many other employers, bringing in staff after A-levels has not only offered benefits in terms of access to talent, but has also proven to be economically sound.

“There are efficiencies in that the cost of training is relatively low compared with training our graduates, and there are certain types of work where it is much more efficient to use an apprentice than it would be to use a graduate,” explains Bagley. “In tax, for example, so much work is around compliance and helping clients to fill in forms. That’s a great training ground for school leavers to see the basics of how tax works, while still getting an insight into what clients want.”

Different routes

Bagley is keen to point out that the company has no intention to promote one route over another, but that offering different routes into the organisation simply reaches out to the broadest pool of talent possible. To illustrate routes into the company, PwC has produced a series of videos to draw out the difference between the three main routes it offers: the Higher Apprenticeship; Flying Start (a combination of university study and placements); and the graduate programme.

“We try to explain the difference, so we might say for the apprenticeship route: ‘If you want to get on with life and get paid while you learn, then go this way’,” she says. “Some people think university is right for them, some are more practical and aren’t suited to academia. There’s no ‘right’ answer.”

Whichever path an employee chooses, it is part of the PwC culture to learn on the job. Apprentices spend most of their time in the office with practising professionals, learning how to deal with complex work issues by ‘doing’ rather than focusing on theory.

“It’s all very well knowing the answer, but you have to know how to apply it. And to do that, you have to see it in action,” says Bagley.

The Higher Apprenticeship programme has been such a success that, if the Government funding for it were to be withdrawn, Bagley believes PwC would still continue to offer it. However, she worries that the smaller companies who have been able to take people on as part of the Higher Apprenticeship in professional services would suffer if this was the case.

“That would be a real shame. We’ve been involved in designing apprenticeships for other employers – this has been a great partnership where we have been able to learn from each other and contribute.”

PwC certainly disproves the perception that apprenticeships only build careers in blue-collar industries. The hope is that many more high-profile employer brands will follow suit.