The Department for Education (DfE) has today published Frontier Economics' study on the cost of apprenticeships. The Government has set a target of achieving 3 million apprenticeship starts by 2020, with no decline in the number of 16-18 apprentices. As a result, reforms have been proposed to ensure that appropriate incentives are in place to meet this target, with a shift to a more employer-led approach. One aspect of this is to replace apprenticeship ‘frameworks’ with employer-led ‘standards’; another is to move to a new funding system.

Anecdotal evidence has suggested that delivering apprenticeships for 16-18 year olds, and employing them in the workplace, leads to higher costs for providers and employers relative to adult apprentices. This has important implications for policy makers as they consider the appropriate design of apprenticeship funding. DfE commissioned Frontier and CFE Research to collate evidence on the costs to providers of delivering apprenticeships for 16-18s, and the costs to employers of training them in the workplace, relative to adults. In particular, the four objectives of this study were:

• To characterise the market for 16-18 apprenticeships in terms of apprentices, providers and employers.
• To explore providers’ activities, costs, business models and responses to funding for apprentices aged 16-18 and adults.
• To explore the drivers of employer decisions about employing apprentices and their activities and costs relating to employing and training apprentices aged 16-18, compared to adults, in the workplace.
• To explore the policy implications of different incentives for employing apprentices aged 16-18, including potential unintended effects.

Frontier regularly advises Government on apprenticeship and Further Education policy alongside wider skills, education and labour market policies.

For more information, please contact media@frontier-economics.com or call +44 (0) 20 7031 7000