As the retail industry continues to undergo monumental structural and technological change, apprenticeships remain a vital way in which retailers increase the skills and productivity of their workforce. 

Retail requires employees at all skill levels throughout their stores, head offices, warehouses, delivery networks and wider supply chains. Employing over three million workers across the UK, rises in productivity in retail (5.1% in 2018) have outpaced the UK as a whole (0.5% in 2018).

Retailers contribute £160m per year into the Apprenticeship Levy. Yet the current system is overly rigid, preventing many retailers from making full use of their Apprenticeship Levy pot. The apprenticeship standards, under which all apprenticeships must exist, are not being developed and approved quickly enough1, holding back take up by the industry.

The latest statistics show the extent of the problem. Apprenticeship starts decreased by 5% to 125,800 in Q1 2018/19. For retail, however, starts fell by 15% overall, with a 20% drop in level 2 starts2. Furthermore, a 2018 report by The Open University suggested the current skills gap in the UK was costing businesses £6.3 billion3.

On Tuesday, during National Apprenticeship Week, over thirty MPs from all parties gathered in Parliament to listen to Rob Halfon MP, Chair of the Select Committee4, and Helen Dickinson, Chief Executive of the British Retail Consortium, explain how the UK must reform the Apprenticeship Levy ahead of the Budget to allow retailers to level up the skills of their workers.

Helen Dickinson OBE, Chief Executive of the British Retail Consortium, said:
“The Government’s current approach to apprenticeships is not working. Retailers continue to pay into an Apprenticeship Levy pot, yet the number of starts has been falling dramatically. Government should make good on their pledge to reform the Levy, allowing retailers to make better use of the system and increasing the investment they make in the UK’s three million retail workers.”

Rob Halfon MP, Chair of the Education Select Committee, said:
“I want to thank the BRC for all their work on apprenticeships and making National Apprenticeships Week 2020 so special in Parliament. We have to ensure that retail apprenticeships are a real ladder of opportunity for people wanting to get skills and jobs for the future. We need to look at possible reform of the levy and the tax system to make sure that we can incentivise and help retailers navigate through the bureaucracy and are encouraged to see apprentices as a vital part of their workforce.”

  1.  Apprenticeship standards are approved by the Institute for Apprenticeships and Technical Education
  2.  DfE: Apprenticeships and Traineeships, England: January 2020
  3.  http://www.open.ac.uk/business/apprenticeships/blog/uk-skills-shortage-costing-organisations-%C2%A363-billion
  4.  Rob Halfon MP is the Conservative MP for Harlow. He was the former Minister of State for Higher Education, Skills, Apprenticeships and Careers in the Department of Education 2016 – 2017 and is currently Chair of the Education Select Committee.
  5. Images from the parliamentary event are available on request