Lord Taylor of Warwick – 2015 Parliamentary Question to the Department for Business, Innovation and Skills
The below Parliamentary question was asked by Lord Taylor of Warwick on 2015-12-14.
To ask Her Majesty’s Government what assessment they have made of the likely impact of the apprenticeship levy on wage growth over the next five years.
Baroness Neville-Rolfe
The OBR forecasts that wages will grow over the next few years, though at a slightly lower rate than would have been the case had the apprenticeship levy not been introduced.
However, we know that apprenticeships have long-run productivity and wage benefits for apprentices and the wider economy, which are not included in the OBR’s modelling. On average, an apprenticeship increases an individual’s earnings by 11-16% within three to five years.[1]
The medium-term benefits of apprenticeships can therefore outweigh short-term wage pressures. We thus consider the net impact of the apprenticeships levy on the economy to be positive.
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