Apprenticeships offered on the minimum wage should not be seen by employers as a route to cheap labour, writes Ken Mann

Yesterday marked a sizeable percentage pay rise across the UK for the youngest age group of apprentices – but it was preceded by a warning landing on my desk from what some might regard as an unusual and, in Scottish terms, irrelevant source. 

Those on the first level of the Minimum Wage on Thursday pocketed a rise of 57p an hour, taking them to £3.30ph, the special apprentice rate for those aged 16 to 18 years.

It also applies to people of 19 who are in their first year of an approved apprenticeship scheme. 

All other apprentice ages are entitled to the National Minimum Wage level that applies to their age group. For example, now anyone over 21 on the highest and most common Minimum Wage tier, apprentice or trained employee, will receive £6.70ph, a rise of 20p. 

Viewed purely on a percentage basis, it’s a decent increase.  If, on the other hand, a recipient is bringing up a family, it remains risible against living costs over the early duration of an apprenticeship programme typically started at 16 years old.  Could apprentices afford to stay the course, with limited state top-up entitlements? It’s an aspect that strikes a chord with David Allison, managing director of GetMyFirstJob, effectively an online apprentice/training provider/employer matching firm, based in Chichester.

You might ask what the view of a recruitment sector MD in sunny West Sussex – even one demonstrating some thought enterprise – has to do with the big picture of employment in Scotland.

Perhaps not a lot. But in a news release that for me wanders a little in its bid to surf a momentary wave of topicality, there is nevertheless some interesting employment market fodder to be digested in an alternative view.

Let’s step back in time. Last week I highlighted a conversation I had with Jean-Marc Gales, the CEO of Group Lotus plc, the sports car maker and advanced engineering business.

It reflected a view, now at last gaining ground in the UK among all sizes of manufacturing engineering companies, notably including BAE Systems defence ships centre of excellence in Glasgow, that bright young technical apprentices are encouraged to progress to relevant university degree education to the benefit of both parties.

It’s a welcome development, rarely exploited in Britain but common for years in peer nations such as
Germany. I remarked that it adds an obvious dimension in feeding a desperate need for graduate engineers in industry, while assisting with university access for some who may find it closed at an earlier stage. Once boiled down, the release issued on Allison’s behalf allows extraction of two specific points. To kick-off it notes his dismay regarding the basic message in promoting “degree apprenticeships”.

These can be a hybrid form of training that involves study at university towards a Batchelor’s degree and on-the-job learning, usually on a course designed around the specific needs of a larger employer. Or on the other hand it could sometimes be the type I referred to last week, when post-apprenticeship progression is an implicit option.

Either way, Allison believes they may give the impression of what he calls “higher education with no fee”.

The release goes on to talk of this in the context of this year’s A-level results week in England. Neither A-levels nor undergraduate tuition fees have much relevance in Scotland, of course, but ignoring those elements, in my eyes his next direct quote does raise a perspective.  

“Are they [apprenticeship degrees] a genuine step forward, or will they simply add more confusion to the ‘Apprenticeship’ brand?” he asks. “It is important this is communicated in the right way.”

Devaluing before they gain currency is the risk, he implies, with collateral damage for participants and to the additional availability of qualified people they are designed to boost.

Allison admits he is a fervent proponent of degree apprenticeships. He studied on an early version with Ford Motor Company: six months at Brunel University, London and six months in work at an attractive salary, every year before award of his BEng. degree.

His second point is centred on a market value for all traditional apprentices. He adds: “The sell to employers is too often about cheap labour. Why do we race to the bottom with the £3.30 per hour sale?” 

On the latter score, I couldn’t agree more. If the laws of supply and demand for the best people at all levels are truly at work, then the price per head should increase to properly supply need. 

On his first proposition, however, I respect his professional view but fail to see the danger.  Is there a risk that places for technical apprenticeships, funded by state or company, could be hijacked by the brighter brigade seeking to play only a cheaper but longer higher education game by obtaining company sponsorship? Surely that’s far-fetched. 

Is an apprenticeship degree – by virtue of being linked to the word “apprenticeship” – likely to be seen as lower class? 

It depends on the course but given the forecast demand for graduate engineers with hands-on appreciation, it seems like scare-mongering. Ultimate earnings potential will not be affected. Even now, evidence shows ex-apprentices in senior engineering management roles. Lotus is an example.

Interesting observations –but I’ll wager it’ll prove to be a flawed argument, in both
England and Scotland.