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Best apprentices earn £50,000 more than many graduates

The government plans to create 3 million apprenticeships by 2020

The best apprentices – those with a level 5 qualification – will earn £50,000 more in their lifetime than someone with an undergraduate degree from a university outside of the Russell Group, taking home close to £1.5m over their career.

The new calculation by the Boston Consulting Group is revealed in Levels of Success: The Potential of UK Apprenticeships, a new report published by the Sutton Trust that looks at the apprenticeship landscape in the UK. The calculation factors in the cost of going to university, including average student debt levels, compared with the ability of apprentices to earn while learning. Those going to Russell Group universities can expect lifetime earnings of almost £1.6m, according to the BCG calculation.IOR Jobs | Recruitment and HR Jobs

Although the report shows that the best apprenticeships offer similar financial security as an undergraduate degree, it warns that the sector needs serious change if apprenticeships are to fulfil their potential as a vehicle for social mobility.

In the current system, the majority of apprenticeships (60%) are set only at GCSE standard (level 2), too many of which offer little value beyond traditional work experience placements and only marginally better lifetime earnings than secondary school qualifications alone. The government plans to create 3 million apprenticeships by 2020, but over the last two years, there have only been an estimated 30,000 higher apprenticeships and the fear is that too many of the new apprenticeships will only be at level 2.

New ComRes polling in today’s report demonstrates how opinions of apprenticeships as ‘second-best’ to a university education appeared to be ingrained in UK culture. Four out of five (80 %) of the young people surveyed – who said they were more likely to go to university or higher education than start an apprenticeship – said they thought getting a degree would be better for their long term career prospects.

This perception extends to teachers and parents too: previous Sutton Trust polling found that 65% of secondary school teachers would rarely or never advise a student to take an apprenticeship if they had the grades for university, and according to the Commission on Apprenticeships barely a third of parents think that an apprenticeship would be the best option for their son or daughter.

Because apprenticeships are particularly popular with those from less advantaged backgrounds, the failure to provide higher standards affects this group more. To make sure that apprenticeships fulfil their potential as a social mobility vehicle, the Sutton Trust is recommending that:

  • Government, employers and other providers work together to provide more apprenticeships at level 3 or above;
  • Level 2 (intermediate) apprenticeships need to be improved so that level 3 (A-level standard) becomes the norm for young people and all those who start on level 2 have the chance to progress to level 3 within the same apprenticeship;
  • The government’s Career and Enterprise Company should promote apprenticeships, as well as university degrees, in their work with schools on careers advice;
  • The government should launch a much bigger apprenticeships awareness campaign to reach young people, parents and teachers;
  • The government should reform the vocational qualification system and ensure that regulation of higher apprenticeships is fit for purpose.

With research from Oliver Wyman, the report also looks at a sample of those apprentices enrolled in some of the UK’s top apprenticeship schemes, a disproportionately high number seem to have attended schools with higher levels of progression to Russell Group universities and lower levels of students receiving free school meals.IOR membership animation 300x250

Today’s report follows HEFCE analysis last week showing that one in five graduates were not in professional jobs three and a half years after graduation, and Sutton Trust research last December showing the different earnings by subject in different types of university.

Sir Peter Lampl, Chairman of the Sutton Trust and of the Education Endowment Foundation, said today:

“The report shows that the best apprenticeships offer similar financial security as an undergraduate degree.  Although the Government’s target for apprenticeships to 2020 is three million, we’ve only had 30,000 higher apprenticeships in the last two years. We need more good apprenticeships to offer genuine alternatives to A-levels and degrees.  We also need to tackle the ingrained negative culture of apprenticeships that exists amongst teachers, parents and young people alike.”

Alice Roberts, 21, apprentice at Jaguar Land Rover, said:

“I think apprenticeships offer lots of advantages over the traditional degree route: you can earn while you learn, receive training tailored to the job you’ll have when you finish, and apply the skills and knowledge learnt at university to real life situations.”

Commenting on the Sutton Trust’s findings, Kirstie Donnelly MBE, Managing Director, City & Guilds, said:

“It’s good to see the Sutton Trust reinforce what we already know; that apprenticeships can and do provide a sustainable, high-quality route into excellent careers for many young people. As we found in our Making Apprenticeships Work report, which was compiled by leading business figures, society has essentially misled the younger generation to assume that higher education is always the best option. Yet figures for graduate salaries are skewed by the very high earnings in certain occupations – the truth is that apprenticeships can also be a financially and personally rewarding choice.

As we know, real change in this area needs commitment from business as well as better information being provided to young people. Employers must recognise the value of apprenticeships and in recruiting the right candidates to the right vacancies. Equally, as the Sutton Trust make clear, there is still work to be done to improve quality and ensure progression is facilitated. I agree – and it’s time for us to get on with it.”

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