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SKILLS ENGLAND AND THE GROWTH AND SKILLS LEVY: WHAT EMPLOYERS NEED TO KNOW
The UK Labour Government’s Skills England initiative is a bold move to boost growth by fixing skills gaps and preparing the workforce for future challenges. Central to this initiative is the Growth and Skills Levy, poised to redefine the existing Apprenticeship Levy it will be one of the most significant shake-ups in skills spending in the past seven years. To understand how employers can best prepare for incoming changes, we interviewed Anna Brailsford, CEO of Code First Girls, and Karen Blake, CEO of Tech Talent Charter and Lee Findell, Partner at WA Communications. Here are the top takeaways:
What is Skills England?
Skills England is the Labour Government’s response to the UK’s widening skills gap, particularly in critical areas such as digital technology, engineering, and green industries. The new body’s goals include:
- Enhancing Skills Training: Skills England aims to revamp vocational education to better align with the evolving needs of businesses. It will play a key role in determining which training programs qualify for funding.
- Promoting Lifelong Learning: The initiative encourages continuous professional development, ensuring that workers can upskill and reskill as needed.
- Supporting Inclusive Growth: Skills England aims to make skills training accessible to all, enhancing workforce productivity, and promoting equitable economic growth.
The Growth and Skills Levy
A key part of Skills England is the Growth and Skills Levy, which is anticipated to be one of the most significant overhauls in skills funding in recent years:
- Greater flexibility for employers: Many businesses have voiced concerns about the current apprenticeship levy’s rigidity, pointing to a lack of innovation and limited flexibility. The new Growth and Skills Levy aims to address this by giving employers more control over how they allocate their levy contributions. This would allow companies to invest in a broader range of training opportunities that better align with their specific needs and the development of their workforce.
- Redistributing unused funds: Between 2019 and 2022, over £3.3 billion in unspent levy funds were returned to the Treasury. Of the funds used, £2 billion was primarily spent on generic management apprenticeship training, which mostly benefited existing staff and their suppliers. This allocation failed to directly address the critical skills shortages facing the UK. Allowing unused funds to be redistributed to skills training would encourage the levy to be spent as it was intended.
- Timeline: Following a consultation period, it is anticipated that the legislation will begin in the House of Lords and come into effect for organisations in the second half of 2025.
The Impact on UK Businesses
For businesses, the implications of Skills England and the Growth and Skills Levy are significant:
- Bridging the Skills Gap: With the reallocation of funds and a focus on critical tech skills, businesses can expect more flexibility when it comes to the use of their levy, and therefore more suitability to use on programs that suit their digital skills needs.
- Boosting Productivity: Better-trained employees mean increased productivity, particularly in industries reliant on digital technologies and modern skillsets.
- Encouraging Innovation: The focus on tech skills will drive innovation across industries, enabling businesses to stay competitive in a global market.
Addressing the Decline in Women in Tech
Despite these efforts, recent data indicates a worrying trend: the UK has lost 6% of senior women in technology this year. This highlights the urgent need for initiatives like Skills England to also focus on gender diversity in tech.
How Code First Girls Can Help
As the UK’s largest provider of free coding courses for women, Code First Girls bridges the skills gap and empowers the next generation of diverse tech talent. We offer alternative pathways into technology, and we welcome the government’s plans to reform the current education and skills landscape in the UK. We also offer comprehensive solutions to upskill, reskill, and redeploy your existing employees in both core and specialised technical skills. Our internal skills programs are open to both women and men.
We understand the evolving nature of these policies and their potential implications. CFG will be gathering insights from its employer base to present to the government, ensuring that the voices of businesses and their needs are heard in the shaping of Skills England. If you would like to explore how these developments could affect your business or discuss how we can support your future training needs, get in touch 👇
To learn more, watch the webinar through this link.
