As with the USA, improving the UK’s sagging productivity is a big economic issue. One of the issues is developing skills and SMEs are often happy to help support this by taking on apprentices. However, currently such employers have to pay full wage for the 2 days a week or so that apprentices are at college (less a small NI deduction). Many SMEs cannot afford to do this so they take on labour directly and train them “on the job”. This means that the apprentices have no formal qualifications going forward, which limits their potential and the amount they can serve the economy in the future.
SMEs should be fully supported for the days their apprentices go for formal education – this formal training helps the employees, grows the skill set the UK needs and encourages SMEs to develop their staff, which in the long run benefits the business and the economy at large.
The least the government could do is cost the training support SMEs need and weigh that against the assessed economic benefits. This is a practical step forward to finding a solution to the need to encourage skills