The Government Summer Statement
The Government Summer Statement brought some welcome good news for jobseekers, with a focus on encouraging employers as to the direction of their hires. Here’s a snapshot of what they are offering:
“A total of £1.6 billion will be invested in scaling up employment support schemes, training and apprenticeships to help people looking for a job. Young people, who are amongst the worst hit by the crisis, will benefit from this. This includes:
Businesses will be given £2,000 for each new apprentice they hire under the age of 25. This is in addition to the existing £1,000 payment the Government already provides for new 16-18-year-old apprentices and those aged under 25 with an Education, Health and Care Plan.
A £111 million investment to triple the scale of traineeships in 2020-21 ensuring more young people have access to high quality training.
£17 million of funding to triple the number of sector-based work academy placements in 2020-21
Nearly £900 million to double the number of work coaches to 27,000;
Over a quarter of a million more young people to benefit from an extra £32 million investment in the National Careers Service.”
What does this mean?
The £2k grant for every new apprentice hire is likely due to the recent report from the Social Mobility Commission on apprenticeships and diversity. In addition, they’re giving £1,500 to companies taking on apprentices aged over 25.
Young people across the country can benefit from a new £2 billion Kickstart Scheme launched to create fully subsidised jobs. For example, those aged 16-24, claiming Universal Credit and at risk of long-term unemployment, will be eligible. Each six-month job placement receives funding of 100% of the National Minimum Wage for 25 hours a week. Employers can also top this wage up.
There will be probably be two schools of thought on this initiative.
For those companies who are already struggling, this may not a big enough incentive. However, organisations previously cautious about their hiring plans for young people may view this as a catalyst to increase numbers. At the very least they may review the decisions they have previously made about apprentices.
Most importantly, the targeted funding will continue to build the focus on apprenticeships, whichever camp employers find themselves in. They are a great route to bring new talent into organisations and address the systemic issues faced by businesses. Certainly this is true in terms of skills gaps, an ageing workforce and the looming Brexit. This fast approaching perfect storm was discussed in our previous post. Subsequently, taking action to solve this is key if we are to come out of the pandemic stronger.
To sum up, it has never more been true that young people and apprenticeships are the key to all our futures.