Many employers aren’t aware of the co-funding principle where for every 10% paid towards training, the government will contribute the remaining 90%. Some have written the Levy off as a tax, but even among the more efficiency conscious, 1,000s are thought to be paying twice for training without realising (despite wondering where all their money is going).
The time for action is now. As of May 2017, any Levy funds businesses don’t use will expire within 18 months. Those in the know have already embraced the Apprenticeship Levy as a welcome relief from the graduate ‘milk round.’ According to the AGR, this recruitment drive saps at least £82 million from employers’ coffers every year and currently stands at an eye watering average of £3,383 per graduate.
Graduates are essential for many business, but the Levy can help to significantly reduce the amount of money spent on training them in the essential management skills the real world of work demands.
The Levy has also prompted finance directors and managers to look again at how their businesses select candidates. Some businesses are opting for less expensive school leavers who can be trained up more cheaply for a greater return on investment and more loyalty than the average graduate (20% of whom leave in the first year).
Meanwhile others are realising the value that’s been in the room all the time, and are using their Levy to develop the management skills of their existing employees.