Employer and Learner Engagement in Higher Apprenticeships in Accounting

Transcription

1 Employer and Learner Engagement in Higher Apprenticeships in Accounting Lynn Gambin Institute for Employment Research (IER) University of Warwick Workshop on Educational Choices in Further and Higher Education University of Sheffield 22 June 2015

2 Outline Definitions and recent figures The Study Higher Apprenticeships & Accountancy Apprentices Employers Implications

3 Definitions Paid jobs that incorporate on and off the job training Referring to Government-sponsored Apprenticeship Apprenticeship levels: (Intermediate) Apprenticeship Level 2 Advanced Apprenticeship Level 3 Higher Apprenticeship Level 4 and above Numerous frameworks (>200)

4 Apprenticeship Starts Massive growth in number of starts 279,700 in 2009/10 to 457,200 in 2010/11; Peak at 521,000 in 2011/12 Fell to 440,000 in 2013/14 Level 2 most common (65% in 2013/14); Advanced 33% in 2013/14 Largest numbers within Health and Social Care (70k in 2013/14); Business Administration (44k) Higher Apprenticeships introduced in 2006/7 2012/13: Higher Apprenticeships, 2% of starts

5 Study on Higher Apprenticeships in Accounting Study commissioned by National Apprenticeship Service (NAS) / Skills Funding Agency (Gambin & Hogarth, 2014) Prompted by relatively high uptake in this sector Considers: employers reasons for engaging in Apprenticeships employers benefits from investing employers costs of training IER Net Costs of Training (Hogarth et al, 2012) approach Case studies of nine employers, fieldwork in 2013

6 Apprenticeship Frameworks Accountancy in top 20 frameworks (by starts, all levels): 8,000 in 2011/12, 2012/13; 7,000 in 2013/14 Accountancy one of 40 available Higher Apprenticeship frameworks (but there were starts only in 19). Higher Apprenticeships more common in accountancy than in many other areas

7 Apprenticeship starts by level Accountancy All Frameworks 100% 2,350 2,190 1, % 3,700 9,800 9,200 7,500 75% 75% 50% 50% 25% 25% 0% 2011/ / / /15** 0% 2011/ / / /15** Level 2 Level 3 Higher Apprenticeship Level 2 Level 3 Higher Apprenticeship Source: BIS Data Library, FE and Apprenticeships

8 Accountancy as % of all starts, by level 80% 60% 40% 20% 0% Level 2 Level 3 Higher Apprenticeship All 64% 22% 14% 12% 2011/ / / /15** Accountancy makes up a sizeable share of Higher Apprenticeships. Has declined over time, mainly due to growth in the number of other frameworks being offered at higher levels. Source: BIS Data Library, FE and Apprenticeships

9 The introduction of Higher Apprenticeships Progression education and career Vocational path for entry to associate professional and professional occupations Higher level skills supply Significant public investment in Higher Apprenticeships: 2009: 5 million to develop more 2013: 40 million for 20,000 starts Higher Apprenticeship Fund 25 million (2014) Trailblazers in accountancy and professional services more broadly But still relatively low (2% of all Apprenticeship starts)

10 Accountancy entry routes and training Modern graduate occupation (Elias & Purcell, 2004) Graduate recruitment well-established; long-standing Majority training to professional status are graduates But longstanding vocational entry routes (including Apprenticeship), too though had long been at Levels 2 and 3 Example, PWC in 2014: recruited 1,500 graduates, 140 school leavers, 800 (paid) student internships (>75% graduate intake) Call within sector to improve diversity, widen entry and ensure skill development - growing number, and level, of entry points into the profession

11 Higher Apprenticeship in Accounting Most employers had been delivering AAT in accounting prior to engaging in Apprenticeship The framework considered in study for National Apprenticeship was Level 4 in Accounting: 12 to 18 months duration AAT Level 4 Diploma in Accounting AAT Level 4 Diploma in Business Skills Success in translating qualifications into Apprenticeships as had an established model of work based training that effectively mirrored the apprenticeship model but had not traditionally been described as such (AAT, 2012).

12 Apprentices Three choices at school-leaving: 1. Direct entry to labour market (with wage) 2. Apprenticeship (with wage and achieving qualification(s)) 3. University (no wage) Full AAT Accounting Qualification and Business Skills Diploma. Including key, mandatory learning and assessment areas for the Diploma in Accounting within the Higher Apprenticeship. Post-completion, possible progression routes: Foundation Degree in Accounting; various degree programmes in Accounting and Finance; or training towards chartered or certified status for which the Level 4 Apprenticeship provides some examination exemptions. Other potential benefits: avoiding delayed entry to work; university tuition fees; earning while learning

13 Apprenticeship starts, by age Accounting 2012/ /14 Higher All Higher All % 28% 10% 37% % 46% 83% 54% % 26% 8% 8% All 100% 100% 100% 100% All Frameworks % 22% 8% 27% % 32% 32% 36% % 45% 61% 37% All 100% 100% 100% 100% Source: BIS Data Library, FE and Apprenticeships

14 Apprenticeship starts, % female learners Accounting All frameworks Higher All Levels Higher All Levels 2011/12 64% 62% 59% 53% 2012/13 63% 60% 66% 55% 2013/14 52% 54% 65% 53% Source: BIS Data Library, FE and Apprenticeships

15 Case Study Employers Case study Employer Number of Employees Business Type Levels of Accounting Apprenticeships offered Duration of Apprenticeship Employer Accounting firm Level 2, 3, 4 1 year Employer 2 70 Accounting firm Level 2, 3, 4 1 year Employer 3 12 Accounting firm Level 4 1 year Employer 4 6,000 County Council Level 2, 3, 4 18 months Employer Accounting firm Level 4 2 years Employer 6 60 Accounting firm Level 2, 3, 4 1 year Employer 7 11 Accounting firm Level 2, 3, 4 1 year Employer Accounting firm Level 4 2 years Employer 9 5,000 Education Establishment Source: Gambin & Hogarth, 2014 Level 2, 3, 4 1 year

16 Employers Employer demand will determine whether Higher Apprenticeships will provide progression opportunities for individuals Employers motivation & training decision: Financial considerations Need for intermediate level skills Balance skill types/levels within organisation Defined roles (apprentice v graduate) but some exceptions Attract candidates (value of training; brand) Corporate social responsibility

17 Benefits to employers Financial better or neutral Main interest in professional qualification (required for work) Wider pool of candidates some they would not have hired before Reduce recruitment and training costs Training in company way increase loyalty, no bad habits Can also help with retention

18 Net cost estimate Average values Basic Information Apprentice salary (p.a.) 12,378 Salary of Fully Experienced Worker (p.a.) 16,272 Apprentice productivity (as % of experienced 83% worker tasks) Costs Recruitment 0 Course fees 247 Supervision costs (including employer NIC and 4,635 PAYE) Apprentice pay (including employer NIC and PAYE) 13,110 Administrative costs 0 Total Costs 17,992 Benefits Apprentice product (including employer NIC and 15,285 PAYE) Other income Total Benefits 15,285 COSTS MINUS BENEFITS 2,707 Source: Gambin & Hogarth, 2014

19 Key implications Crowded qualification landscape potentially 100% deadweight, substitute or subsume existing qualifications (transitional, other benefits) Employer sensitivity to costs particularly pertinent when considering move to employer co-funding and other reforms Some evidence of widening pool and opening entry but need for employers to see this as added value to continue Possible concerns about actual progression within sector after training to Level 4 Relationship to graduate entry Trailblazer development will have further implications (e.g. impact on diversity; sustained investment)

20 Further details Full report: Gambin & Hogarth (2014) Employer investment in Higher Apprenticeships in Accounting