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ApprenticeshipsA New Approach

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Contents3 Foreword by Mark Cook of FE Business

4 Why the Need for a New Approach?

5 Identifying Industries

8 Identifying Occupations

10 Identifying Employers

11 Final Thoughts

About EMSIEconomic Modelling Specialists International (EMSI) are working with nearly 100 colleges across the

country, helping them to get to grips with some of the biggest issues of the day. These include:

• Better understanding local labour market needs

• Shaping a curriculum that meets local demand

• Providing young people with objective careers information

• Marketing courses to the local community

• Measuring the value a college brings to its stakeholders.

Through our unparalleled local and granular data, EMSI can give colleges the understanding they need

to more effectively take their place as key economic drivers in their community.

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Forewordby Mark Cook of FE Business

It’s not news to anyone reading this report about the importance of apprenticeships to the economy and

the skills sector over the coming years. Of course, it makes sense to align skills investment with growth

in jobs and enterprise. Further, putting this investment increasingly in the hands of employers will lead

to greater uptake —businesses often cite a lack of market-relevant curriculum products as being the

biggest barrier to engagement with apprenticeships.

However, as the market becomes more contestable and competitive, how are colleges and training

providers going to stand out from the crowd? The market has matured greatly in recent years, and ever-

more sophisticated and business-like approaches are required for success.

We have worked with over 30 providers in the past 12 months supporting them to diversify income and

grow in key areas such as this. There are some key elements that are common to the most successful,

one of which is the provider’s ability to collate and interpret market intelligence, combining it with their

own capability to create and promote dynamic curriculum products that impact on employer’s business

drivers.

We’ve seen time and again how labour market data is a powerful tool when integrated into a robust

product development and marketing cycle. We’re excited about EMSI’s ability to identify growth sectors,

skills needs and pinpoint named employers. Of course, what you might do with this intelligence—

combining it with your own particular capabilities—is what creates your unique competitive advantage.

But we’re certain about one thing—LMI as relevant and granular as this is an essential must-have

for successful apprenticeship providers of the future.

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Mark Cook, Director of FE Business (febusiness.co.uk)

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Why the Need for a New Approach?In their election manifesto, the Conservative Party announced plans to embark on a big expansion

of apprenticeship places over the course of the parliamentary cycle, pledging to create three million

by 2020 in order to “deliver the skills employers need.” They also made it clear that whilst funding for

apprenticeships would be increased, monies allocated to regular Further Education courses would be

cut:

Since the election, the Government has moved in the Enterprise Bill to enshrine in law their

commitment to deliver three million apprenticeships over the next five years, in addition to granting

apprenticeships “equal legal treatment to that of degrees.”

The message could hardly be clearer that apprenticeships are going to take priority over, and perhaps

even begin to phase out, classroom-based training. In general terms what this means is that colleges

are going to have to find ways of adapting to this new reality, and they may well need to do this fairly

quickly. More specifically, we would suggest that the pressing need of the hour is for colleges to develop a

far more strategic and targeted method to the way they approach apprenticeships.

Now, if we were to ask for a “hands up” from colleges who feel they already have a robust and targeted

approach to apprenticeships, how many would honestly say yes? Our experience in the sector tells us

that those answering positively will probably be in the minority. There are perhaps two reasons for this.

The first is that until now, colleges have not necessarily had to focus on apprenticeships over and above

other delivery options. The second is that it’s actually not very easy to develop a targeted approach. Who

do we need to target? What are their needs? How do we target them?

In answer to the first reason, we would repeat what we have already said above, which is that given the

Government’s priorities of apprenticeships over classroom-based learning, colleges are going to find that

they have no choice but to change the way they operate. As for the second point, we believe that there

is a leading role for sound Labour Market Information (LMI). If the problems of developing a targeted

approach are knowing which employers to target, what to target them for, and how to target them, LMI

can help by:

1. Identifying target industries

2. Identifying their skills needs

3. Identifying the employer

The value of LMI is therefore that it can remove much of the guesswork and scattergun approach to

apprenticeship planning and targeting, making the whole process much more targeted and effective. The

purpose of this paper is to walk you through some of the ways this can be achieved.

“We will continue to replace lower-level, classroom-based Further Education courses with high quality apprenticeships that combine training with experience of work and a wage.”

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Identifying IndustriesOne of the biggest problems facing any college looking to increase its apprenticeship provision is

knowing which industries to target. A college might have good relations with certain employers and

already be partnering with them in creating apprenticeships, but how do they set about knowing who

else to target?

There are a number of approaches that could be taken. Here are a couple:

1. A college might want to target employers in the curriculum areas they already cover.

2. A college might want to target the sectors which look like they will experience growth.

Before coming on to give some examples, first a necessary caveat. The data presented below, and in

subsequent chapters, is not intended to mean that the sectors and occupations shown in the tables

and graphs are necessarily ones that colleges ought to be engaging with. Some of the industries and

occupations shown will not employ/support apprenticeships. Rather, the data presented is simply meant

to give a flavour of how colleges might begin to use LMI — together with their own criteria and good

judgement — to find and target employers.

Moving on to an example, let’s look at the Top 10 industries in the Greater Manchester area in 2014, in

terms of numbers employed (all examples in this booklet are taken from the Greater Manchester area,

which includes Bolton, Bury, Manchester, Oldham, Rochdale, Salford, Stockport, Tameside, Trafford, and

Wigan):

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Description 2015 JobssHospital activities 69,548

Public administration and defence; compulsory social security 51,011

Primary education 44,120

Temporary employment agency activities 42,161

Retail sale in non-specilised stores with food, beverages or tobacco predominating 41,760

Restaurants and mobile food service activities 31,634

General secondary education 30, 180

Business and other management consultancy activities 25,447

Accounting, bookkeeping and auditing activities; tax consultancy 25,362

Financial service activities, except insurance and pension funding 23,719

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A college might look at data such as this and decide to target those industries shown which they believe

will support apprenticeships. However, the approach of simply targeting the biggest industries is perhaps

not the most effective in terms of fulfilling the Government’s aim for apprenticeships to “deliver the

skills employers need”. It could well be that these industries might be set to remain fairly static over the

next few years, or even experience decline.

A more effective method might be to find out which industries have been experiencing the most growth.

The following graph shows the top 10 growth industries, in terms of job numbers, in Greater Manchester

between 2014 and 2015:

These figures represent the current state of things in the economy of Greater Manchester, but how about

if we look into the future to see what is forecast to take place over the next few years? Using our forecast

data, which is based on past and present trends, we can do just this. Below is a graph showing what we

expect to be the 10 highest growth industries, in terms of jobs, in the greater Manchester area over the

next three years:

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345

365

365

367

574

646

746

963

1,117

1,702

3,308

3,158

2,556

2,009

1,687

1,433

1,393

1,216

912

891

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What we have shown in the table and graphs above is the biggest industries, current fastest growing

industries, and a forecast of highest growth sectors over the next few years. But there are other

approaches that can be taken. For instance, a college might want to choose one particular sector –

perhaps one in which they already have a strong apprenticeship provision, or even one they feel could

potentially be increased – and zoom in on it to find out what is going on in within the industry.

For example, the Construction industry has traditionally been a big apprenticeship sector, and therefore

a college might want to take a look at some of its constituent parts. The following table shows the Top 10

employing sectors at the 4-digit SIC code (i.e. most specific industry category), within the Construction

sector in Greater Manchester:

Again, the exercise could be redone for a different time frame (say, 2015-2018), and for any industry.

However, all of this information is really just a start. Industry size, current growth, or future growth is

all very interesting, but it only goes so far. What it doesn’t tell us is which occupations are employed in

these industries, where the occupational growth is likely to be, and therefore we are none the wiser with

this information – by itself – as to which apprenticeships are needed. The following chapter will address

this question.

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Description 2015 Jobss

Construction of other civic engineering projects n.e.c. 367

Other specialised construction activities n.e.c. 307

Construction of residential and non-residential buildings 290

Development of building projects 155

Electrical installation 148

Other contstruction installation 85

Roofing activities 68

Construction of utility projects for fluids 39

Construction of bridges and tunnels 30

Construction of utility projects for electricity and telecommunications 9

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Identifying Occupations LMI, as such, cannot identify the needs of industry. The data can tell us industry numbers and occupation

numbers, but by itself it can’t tell us the occupational make up of each industry. However, EMSI is

not just a data company but an economic modelling company, and we have a dedicated team of data

analysts and economists who have worked together over the years to establish a robust methodology

which allows us not just to find out how many people are employed within an industry, or to find out

how many people are employed in certain occupations, but also to show the breakdown of occupations

and occupation numbers within each industry. The detailed granularity of this function is, so far as we

are aware, something that is quite unique in the world of LMI.

Housed within our Analyst tool is a Staffing Pattern function, which allows users to quickly and easily

establish this information. So let’s take an example. As we mentioned above, Construction is one of

the biggest traditional apprenticeship industries, and so any college looking to increase the number of

apprenticeships they offer is certain to want to explore this sector. The following table shows the Top 10

occupations within the Construction industry as a whole in the Greater Manchester area in 2015, along

with expected change over the next three years:

What the data in this example is telling us goes well beyond simply knowing that Construction is going

to grow. It delves into which occupations within Construction are set to grow, and by doing so it throws

up some important figures for our consideration. For example, a college in Greater Manchester might

have assumed from the overall figures for Construction that increasing the number of apprenticeships

for carpenters, joiners and plumbers is a good idea. Not necessarily, according to the data. Whilst

demand in some occupations is set to grow – such as Electricians and electrical fitters – demand for

plumbers and heating and ventilation engineers is barely set to rise over the next three years, and

demand for carpenters and joiners is actually likely to fall.

Another interesting aspect of this table is that the educational level for each occupation is displayed.

This information is highly useful for colleges reviewing their apprenticeship programme, as together

with employment numbers, it enables them to get a good idea of which occupations may or may not be

potential targets for engaging employers.

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DescriptionEmployed in Industry, 2015

Employed in Industry, 2018

Change Education Level

Electricians and electrical fitters 4,194 4,370 176 Level 3

Production managers and directors in construction 3,137 3,269 132 Level 3

Plumbers and heating and ventilating engineers 2,997 3003 6 Level 3

Elementary construction occupations 2,585 2,657 72 Level 2

Carpenters and joiners 1,978 1,951 -27 Level 3

Other administrative occupations n.e.c. 1,816 1,938 122 Level 2

Construction and building trades n.e.c. 1,765 1,825 60 Level 3

Construction projects managers and related professionals 1,516 1,601 85 Level 6

Scaffolders, stagers and riggers 1,315 1,399 84 Level 2

Book-keepers, payroll managers and wages clerks 1,172 1,248 76 Level 2

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We could do the same exercise as above, but this time for a more specific industry (i.e. at the 4-digit SIC

level). The table below takes the example of the Construction of other civil engineering projects n.e.c. (a

4-digit SOC industry), and we have run a Staffing Pattern to show where the occupation growth is likely

to be:

Once again, it should be noted that this is in no way intended to say that colleges in the Greater

Manchester area should be targeting employers connected with these occupations; rather our purpose

is solely to give you a snapshot of how a college might use our data to begin determining which

occupations exist in which industries, which in turn can be used to facilitate a more structured and

targeted approach to engaging employers for apprenticeships.

The variations of how a college might go about selecting the data they want to look at are pretty much

limitless, but whichever criteria a college uses (eg. job numbers, job growth etc) by then running a

Staffing Pattern they can quickly discover which occupations are employed in those industries, along

with job numbers, job trends and educational level.

This does, however, lead to a further question. If a college is able to use the data to pinpoint which

industries they should target, and they are then able to use the data to identify where the occupational

needs are in those industries, how do they then move forward to identify who those employers are? This

is the question we will be tackling in the following chapter.

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DescriptionEmployed in Industry, 2015

Employed in Industry, 2018

Change Education Level

Civil engineers 797 876 79 Level 6

Production managers and directors in construction 573 623 50 Level 3

Construction project managers and related professionals 328 356 28 Level 6

Elementary construction occupations 284 304 20 Level 2

Quantity surverors 229 255 26 Level 6

Production managers and directors in manufacturing 226 254 28 Level 6

Construction operatives n.e.c. 220 246 26 Level 2

Construction and building trades supervisors 196 214 18 Level 3

Book-keepers, payroll managers and wages clerks 178 198 20 Level 2

National government administrative occupations 169 194 25 Level 2

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Identifying Employers The process of identifying the employers in an industry ordinarily requires some rather painstaking and

time-consuming research. However, an innovation that we brought into our Analyst system back in 2013

means that it is now a relatively quick and easy process.

The innovation in question was the introduction of Equifax business data, which is a UK-wide database

of information on companies, including company names, addresses and numbers of employees. What

we did was to tie this information to our industry data, which means that users can now find out

instantly who the employers are within any industry in their area.

So let’s take the Top 10 Construction industries within the Greater Manchester area. By running an

Equifax report, we can find out the details of all the employers in the Greater Manchester that fall within

the Construction sector. The table below shows the Top 10 employers these industries, in terms of local

employee numbers:

Please note, we are constrained as to what we can and cannot show in this table in a publication, but

within Analyst there are many more details for each employer, such as contact name, website, email

address and postal address. Also note that although the data displayed here is connected with a broad

level industry — Construction — the function can be used for any industry, right down to the most

specific 4-digit SIC level.

So having researched industries, then run a Staffing Pattern to see which occupations fall within the

industries we are investigating, the Equifax data takes employer engagement to a whole new level by

instantly giving colleges the contact details for the employers they might want to target. The college

following through with this three-stage process is therefore able to identify target industries, identify

their skills needs, and then quickly and simply ascertain which employers to target, and how to target

them.

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Description Local EmployeesAinscough Crane Hire Ltd 984

Bradley Hall Holdings Limited 984

Seddon Construction Limited 831

R.D.Scott Limited 738

Industrial and Commercial Construction Limited 75

The Kilroe Group Limited 623

G & J Seddon Limited 617

Greenberg Glass Limited 583

Forrest Corporate Limited 529

Greegberg Glass Limited 523

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11

Final Thoughts

Things are moving on quickly in the FE sector and it sometimes feels like colleges are getting swamped

with initiatives and directives from above. For instance, hot on the heels of the Government’s

announcement of creating three million apprenticeships over the next five years was the recent

announcement by the Department of Business, Innovation and Skills that they would be setting up a

series of area reviews across the country, looking into how well colleges are meeting the needs of their

local economy.

The stakes are high. With the Government making it clear that institutions that do not come up to

expectations will be forced to collaborate, merge or possibly even close, colleges are entering a critical

phase which may well determine whether they are still around in five years’ time.

What this means is that colleges are going to have to look for new solutions – and quickly – with one of

the key areas where this is most apparent being the area of apprenticeships. As Mark Cook said in the

Foreword, colleges and training providers are going to need ever-more sophisticated and business-like

approaches to attain success in growing apprenticeships, and this will include – as a necessity – the use

of relevant and granular LMI.

This booklet has attempted to flesh out the practical side of this, setting out how LMI can be used

to create a more sophisticated, targeted and business-like approach to apprenticeships. The process

described throughout can essentially be broken down into the following simple steps:

Step 1: Use of industry data to identify sectors you might want to target

Step 2: Use of Staffing Patterns to identify the occupational/skills needs of those industries

Step 3: Use of business data to identify employers

The old approach to apprenticeships – working with the same employers year after year, or phoning

through an A-Z of employers – is just not going to work anymore. What is needed is a new approach.

With this simple three-step process, a college will have at its disposal a new and highly effective way of

engaging local employers in growth industries for apprenticeships. Over the coming weeks, months and

years, this is just the sort of new approach to a crucial issue that could well make the difference between

success and failure.

Andy Durman, Managing Director (EMSI, UK)

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To find out more about how EMSI can support your organisation’s approach to apprenticeships, or any of the issues

mentioned above, contact Andy Durman:

Email: andyd@economicmodelling.co.ukPhone: 07720 641 651

Web: www.economicmodelling.co.ukBlog: www.economicmodelling.co.uk/blog

Twitter: @EMSI_UK