Why more companies are starting to grow their own

Feb 27 2008 by Karen Dent, The Journal

Plans to double the number of apprentices will transform the nation’s skills’ shortage, discovers Karen Dent.

One in five young people will be apprentices in the next 10 years if Gordon Brown gets his way.

The Prime Minister says a further 90,000 apprenticeships for 16 to 18-year-olds will come on stream within five years, doubling the number available in the North East to 10,000.

The Apprenticeships Review, published last month, outlined plans to bolster the UK’s skills base which is lagging behind some of our industrial competitors.

Durham City Labour MP Roberta Blackman Woods said: “As a country we have always under-valued vocational education.

“In former coalfield areas like Durham during the 1980s we saw very little investment in the community and schools. That’s now changed massively but we also need to raise the aspirations of our young people.”

More than 200 apprenticeships are available in more than 80 industry sectors. Businesses must pay apprentices at least £80 a week, and provide on-the-job and college training so they can work towards a formal vocational qualification.

However, unlike the UCAS system for university applications, there is no central database to match potential apprentices with apprenticeships. The National Apprenticeship Service, due to be piloted next year, aims to resolve this issue by launching a searchable database where employers can list vacancies and would-be apprentices can contact them directly.

Regional CBI director Sarah Green said: “Setting up a National Apprenticeship Service to deliver and be fully accountable for the programme and creating a ‘matching service’ to help employers fill apprenticeship vacancies are positive steps.

“But the Government must also address poor quality careers advice, enable apprenticeships to adapt more quickly to firms’ changing skill needs and ensure that the way literacy and numeracy skills are taught shows young people their relevance in the workplace.”

Bringing more businesses on board to offer apprenticeships – especially smaller firms – is a problem. Currently, there are no financial incentives, although a wage subsidy is currently under discussion.

“At the moment the big issue is that we have far more people wanting to do apprenticeships than businesses offering places,” said Chris Roberts, regional director of the Learning and Skills Council (LSC) North East.

He says some small companies are sharing their resources to employ apprentices. The Derwentside Engineering Forum (DEF) is one such initiative using a collaborative approach. The forum, a non-profitmaking limited company, was formed in 1999 to tackle the skills shortages becoming apparent in Consett as former steelworkers began to retire.

DEF chairman John Lyle said: “There were a lot of indigenous skills here but gradually we were using those skills up. The pool needed replenishing, people were getting older.

“In 1999, it was 20 years on from when the steelworks closed. For once, the companies said we’ll do something about it. But no one company was big enough to solve the training problem.”

Mr Lyle persuaded 10 businesses to provide around £15,000 in cash and £50,000 of equipment to run apprenticeship courses at Derwentside College to deliver the training industry required.

Mr Lyle said: “It’s been very successful. The companies are getting good quality people through. When they take someone on, they know they’re going to get someone with that added value.”

There are now 33 members of the forum and similar bodies are being set up in Sedgefield and Easington.

Previously, nationalised industries such as a coal and nuclear power, and large conglomerates such as ICI and Unilever, ran big apprenticeship schemes. They trained more apprentices than they needed and the surplus graduates plied their skills in the private sector. Since the conglomerates disbanded and industries were privatised, no central bodies have performed this training role to the same degree.

Dr Stan Higgins, chief executive of the North East Process Industry Cluster – the umbrella group for the region’s 200 pharmaceutical, biotechnology and chemical companies – said: “Their training schools were large and they’ve not been replaced. We’ve not been filling the supply chain with technical apprentices for many, many years.

“These are the things that underpin the process industries, which underpin every activity we have in life from the food we eat, the clothes we wear, to the fuel for our cars. Unless these skill are underpinned, we fall back into the dark ages.”

An Academy for the North East Processing Industries is to be based at Teesside University.

Dr Higgins said: “There is a lot of anxiety in the labour market at the moment. We’re desperately trying to train more people. These skills shortages were being predicted 10 years ago.”

The North East Chamber of Commerce works with businesses to develop apprenticeships, from recruiting and interviewing to selecting and training apprentices. It currently has 248 CVs from potential apprentices gathering dust because there are no vacancies.

“Parents have got the message, young people have got the message, but there is a dearth of employers who will take them on,” said Karen Brown, the NECC’s director of training and skills. “It’s very short termism. Companies are not growing their own any more.”

She says employers question why should they pay an apprentice and contribute towards training fees, when they can employ a qualified person for the minimum wage. She urged businesses to look at the age of their workforce and consider whether they would have suitably skilled staff in five or 10 years time.

“It’s about everybody thinking: ‘are we doing enough to encourage the youth of the North East?’” she said. “We are the worst area in the UK for young people sitting around doing nothing.”

The NECC works with Yarm-based Vixen Surface Treatments to train apprentices.

The firm, which has five apprentices among its 40 staff, manufactures industrial washing, degreasing and wet blasting machinery for clients including Black and Decker, Triumph Motorcycles and the Ford Motor Company. The firm tried employees who had worked in related industries such as the shipyards, but managing director Aidan Mallon believes specially-trained staff are superior.

He said: “Thin sheet metal work is not a skill that’s in abundance in this area. We prefer to train and develop those people from apprentices. You’re developing them into your culture.”

Nissan, which came to the North East 23 years ago and has always offered apprenticeships, also prefers to “grow its own”. Currently, it runs two courses – the trainee manufacturing staff scheme and the trainee maintenance technician apprenticeship, in conjunction with the Centre for Automotive Excellence at Gateshead College.

“Although not guaranteed, apprentices tend to secure a full-time job at the Sunderland plant on completion of their course.

Training controller Ann Ratcliffe said: “They’re working with people with a lot of years experience so the training they get is second to none. On both schemes, they end up with a boatload of qualifications.

“What attracts the young people is that they’re earning while they’re learning.

Both schemes are very well paid. And the end product is exactly what we want, in terms of skills and attitude.”

The LSC has put together a guide for businesses interested in offering apprenticeships for the first time. Apprenticeships … A Great Idea for Business giving an overview of apprenticeships, what benefits they have and what firms have to do if they want to take on an apprentice.

The factsheet contains explanations of frequently-asked employer questions, such as the length of training, how the apprenticeship programme works in practice and what a business owner’s responsibilities are.

Apprenticeship Week runs from February 25 to 29.