Investing in the human infrastructure: Apprenticeships in the Engineering and Construction Sector
December 8 2016 —
The benefits of the UK becoming a thriving environment for apprenticeships are nowhere more evident than in the construction and engineering sector.
For the country at large, a steady influx of talented engineers who combine technical know-how with on-the-job experience better positions us to deliver the major infrastructure projects required to address the UK’s chronic productivity problem. This month’s Autumn Statement featured plans to access untapped economic gains through investment in innovation and infrastructure, but this requires the right human resources as well as ambitious spending commitments.
A 2015 report carried out by the Centre for Economics and Business Research (Cebr) for EngineeringUK estimated the 49,500 Engineering & Manufacturing Technologies (EMT) apprentices who qualified in 2013/14 will make an aggregate productive contribution to the UK economy of £1.6 billion in 10 years’ time.
With a significant proportion of the workforce expected to retire in the coming decade, firms fearing an impending skills shortage will benefit from actively promoting engineering qualifications to greater numbers of young people. To ensure that they’re attracting and training the best-suited, these firms need to cultivate inclusive cultures and market themselves to the most diverse audience.
Because, for talented school students from low-income backgrounds, apprenticeships represent a valuable opportunity to gain a qualification that provides access to a high-skilled profession without the deterrent of tuition fees. Concerns about social mobility are as prevalent today as they have been in decades, with the Prime Minister placing the topic front and centre of her inaugural address on the steps of 10 Downing Street. The Social Mobility Foundation’s ‘State of the Nation 2015’ report revealed that children from high-income backgrounds are 35% more likely to be high-earners as adults than their lower-income, higher-ability peers, underlining the critical importance of opening up alternative lucrative career paths that begin with paid training.
Apprenticeships in the engineering sector do precisely that. The same Cebr report projected that a level 3 EMT apprenticeship will deliver a net lifetime earnings premium of approximately £111,900. Whilst this figure is smaller than the equivalent premium from an engineering degree, the gap between the payoff from a degree and an apprenticeship in the engineering sector is smaller than average and narrowing all the time, making the “economic decision around whether to attend university… less clear than it was in the past”.
Continuing to increase the provision and quality of apprenticeships will therefore remain a centrepiece of any successful effort to improve social mobility in the UK. The political will is certainly there, with the Conservatives having committed in their 2015 general election manifesto to delivering 3 million apprenticeships in England over the course of this Parliament, in addition to the 2.3 million new apprentice placements created by the coalition government. Whilst concerns have been voiced that a firm political commitment to quantity will inevitably lead to a dilution in quality, recent figures from the Department for Education’s Skills Funding Agency showed that there were a record 76,690 apprenticeship starts in the higher-skilled EMT sector in 2015-16.
So how can we make the most of the apprenticeship opportunity? Last month we were delighted to convene a Business in the Community Round Table Breakfast with a range of companies to discuss the skills gap our sector faces. Using the lens of responsible business, our discussion focused on how we as a sector could take action to change the landscape by investing in talent.
One of the topics that was top of the agenda was how to address the way that apprenticeships are viewed, with 90% of parents thinking they are a great idea, but 32% not wanting them for their children. We need to change the perception of apprenticeships for young people and parents alike, in order to get more apprentices in our industry. Attendees agreed that businesses need to work more closely with schools and colleges, to convince school leavers that apprenticeships are a good opportunity that they should consider.
Obstacles do remain, and questions still linger about the arrangements for the soon-to-be-instituted apprenticeship levy, particularly its longer term impact. But, with a potential reward of a more meritocratic, prosperous, and socially mobility, our commitment to promoting apprenticeships as a route into our sector remains absolute.