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Apprenticeship Levy: Challenge or opportunity?

30 March 2017

On 6 April 2017, the UK’s first ever Apprenticeship Levy officially comes into force, meaning 22,000 businesses will be liable to pay 0.5% of their annual wage bill into the fund.

The Levy is aiming to generate £3 billion per year, with the ambition to train three million people across all private and public sector businesses by 2020.

While it feels like good news for employees; a third (33%) of UK businesses say they’re confused about the implications of the levy, and nearly a quarter (23%) of those heading-up apprenticeships are not even aware of it.

Equally, there is a widely-held belief that the levy will only fund roles for new apprentices; but in reality it will create the opportunity for existing employees to upskill, as well as new jobs.

FM services provider ABM UK is embracing the introduction of the levy and its investment of over £.5m in year one is seen as a real opportunity to bolster its workforce with new and existing highly-skilled employees.

ABM UK group managing director, Andy Donnell, comments: “We don't see the Apprenticeship levy as a challenge; we see it as a great opportunity to develop our people. In a way, we already feel one step ahead, as the training infrastructure we currently have in place is established and comprehensive.

"For us, the levy feels like a natural extension and progression to the training that we're already providing our staff with.

“This is a real chance for us to balance the training equilibrium with people at every level. It will allow us to invest in some of the people who historically haven't been invested in, and to upskill and develop their talents.

"For us, this is just as exciting as helping to bring new people into the industry.”

ABM UK believes that the Apprenticeship Levy will help its staff progress their careers faster, which in turn will leave more opportunities for new talent to establish.

Having already appointed Jigsaw Training as its official training provider, ABM UK is ahead of the curve when it comes to embracing this new focus.

With over 5,500 staff in the UK, ABM UK aims to offer approximately 120 apprenticeships in year one.

The top 10 things to know about the Apprenticeship Levy, according to ABM UK:
1. The Levy is a tax on employers, which will fund apprenticeships and training.
2. It aims to address the worsening skills gaps in the UK workforce.
3. By increase the quality of apprenticeships, the government hopes to make them a viable alternative to university.
4. Employers with an annual wage bill in excess of £3 million will be liable to pay 0.5% of their pay bill into the levy fund.
5. It will apply to businesses across all sectors, both public and private.
6. Approximately 22,000 UK businesses will be affected.
7. It’s not just for the new apprentices; training is also available to existing staff.
8. The Apprenticeship Levy will generate £3 billion per year.
9. The ambition is to train three million people by 2020.
10. The Apprenticeship Levy officially comes into force on Thursday 6 April 2017.

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