Any other business: Apprenticeships are on the rise in the pensions industry, and while they appeal to an increasing number of people as a debt-free alternative to university, the apprenticeship levy and the prospect of jumping straight into a full-time job are still hurdles to be overcome.
The number of 18-year-olds accepted at university or college in 2016 increased by 1.5 per cent to 238,900, the highest number ever placed, according to the Universities and Colleges Admissions Service.
It’s all about giving young people the opportunity to experience things on the ground in a structured environment
Claire Court, Delta Financial Systems
However, the Chartered Institute of Personnel and Development, a professional association for human resource management and professionals, has argued that while the UK’s higher education sector has expanded rapidly, the increase in the number of graduates has not been matched by an increase in high-skilled jobs.
Going against the grain
It argued that if there is to be a change in attitudes to non-university routes to employment, “there needs to be a significant improvement in the quality of careers advice and guidance”.
From asset managers to accountant firms to technology companies, there are a number of companies offering apprenticeships to school and college leavers in the pensions industry.
Karis Stander, managing director at Investment 2020, a careers site set up to provide access to school leaver and graduate trainee programmes across 29 partner companies, said it is now becoming more commonplace to offer apprenticeships, particularly within financial services.
She explained that companies are really starting to understand that having different entry points for people to start their careers facilitates diversity while allowing a school or college leaver to really develop their skills within the company.
Stander also noted that it would be in the interest of companies to consider whether it is a good “use of talent resource to bring in a highly skilled graduate to a job that they’re going to grow out of pretty quickly, because that then becomes a bit of an expensive mistake for the employer”, said Stander.
While apprenticeships are proving popular, companies will soon face the government’s new £3bn apprenticeship levy, which comes into force in April. This means UK employers will be charged at 0.5 per cent of their annual pay bill if it is more than £3m.
This puts companies in a “slightly tricky position”, said Stander. She explained they want to make sure the training each of their apprentices receives is "relevant and fit for purpose” and that they want “to make the best use of the levy that they’re going to be paying”.
Reaping the rewards
While apprenticeship programmes can benefit people keen to jump straight into corporate life while bypassing student debt, companies can also reap the rewards.
Claire Court, business development director at Delta Financial Systems, a firm that creates pensions administration technology for the financial services industry, argued that apprenticeships “will help plug the skills shortage that our industry’s facing”.
Delta Financial Systems has had “two very successful apprentices come through [the] client services part of our business”, one of whom works on the pensions support team, said Court.
“I think apprenticeships are a really credible alternative to university now,” she said. “It’s all about giving young people the opportunity to experience things on the ground in a structured environment.”
When it comes to apprenticeships, financial services, including the pensions industry, may be “following on behind” from other sectors, including the engineering industry, Court noted.
“We’ve got some catching up to do, but I think it’s a way we can tap into this whole pool of amazing talent that we’ve perhaps not considered before,” she said.
Dissuaded by student debt
Isabella Nicoll is a business management executive in marketing at M&G Investments, one of the Investment 2020 employers taking in trainees through apprenticeships. She started her apprenticeship with the company in November 2014.
No gain without pain: Children and financial education
Any Other Business: Learning to manage money from an early age could help children get used to deferring gratification, potentially proving invaluable in saving for later life.
On completing her A-levels and being offered a place at university, Nicoll realised she “didn’t actually want to go”, despite the majority of her peers going down the university route.
She said the debt accumulated from going to university these days is huge, adding: “If I could be saving my £200 a month into a house deposit as opposed to paying off my student loan, then that would be a better use of my money.”
However, some might say that diving straight into the world of work can be quite a shock, because university is often seen as a gateway to becoming more independent.
“At first I did find it nerve-wracking,” said Nicoll, because it was a “daunting life change” to go straight from school to office work. But “within a month” she realised it was the best decision she had ever made.
However, she said many schools are more geared up to getting people into university. When it came to looking into finding an apprenticeship, "I had to do it by myself".
