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Apprenticeships can turbocharge aspiring accountants’ careers

Author: ICAEW Insights

Published: 07 Feb 2023

To mark National Apprenticeship Week, ICAEW explores how the financial benefits of apprenticeships have been a big driver in their adoption, but talent-hungry businesses can use them as an effective way to address skills shortages.

Accountancy apprenticeships could offer organisations a cost-effective means to address recruitment challenges and skills gaps, as the war for talent rages on. But despite their huge popularity across accountancy firms, businesses are being slow to catch on, a training provider is warning.

Gareth John FCA, Director of training provider First Intuition, says that around 85% of trainees in accountancy firms now study via the apprenticeship route, compared with just 5% around five years ago. In contrast, take up of the apprenticeship option among businesses remains relatively low, even though they are hungry for talent, John says.

First Intuition works with organisations including EY, RSM, AstraZeneca and Greene King to train accountants through the apprenticeship route. John says that the huge difference in take-up between accountancy apprentices in practice and industry is surprising, even factoring in a growing reluctance among individuals to shoulder the cost of a university education

“One of the big blockers is the 20% off-the-job learning requirement of an apprenticeship programme. ICAEW firms are used to giving quite generous study leave, which is not always true in industry. It’s perhaps one of the reasons why we’ve seen far more rapid adoption of apprenticeships within accountancy training firms than we have within businesses and industry,” he says. “However, off-the-job learning is one of the most misunderstood aspects of apprenticeships. It certainly does not mean that the employer loses their apprentice for a day a week. Much of their productive time in the workplace will count towards the requirement.”

The financial benefits of apprenticeships have been a big driver in their adoption, particularly among those large organisations paying the apprenticeship levy, equivalent to 0.5% of an employer’s annual pay bill where it exceeds £3m.

“Larger firms that are levy payers can use their own levy pots to fund training so that they don't lose the contributions that they've been making. Smaller firms that don't pay into the levy can draw up to 95% of the cost of the apprenticeship from the Apprenticeship Service, essentially from unused apprenticeship levy funds,” John explains. “This can mean huge savings for them.”

But he says the funding of apprenticeship costs is a crude incentive. “The real magic of apprenticeships is the additional skills that apprentices develop and the additional support that they receive.” As well as the knowledge they gather to pass their accountancy exams, together with skills, competences and behaviours developed by the professional development and ethics requirements of the ACA, the additional threads of “skills” and “behaviours” from the apprenticeship create well-rounded qualified finance professionals, John explains. 

“The ACA qualification is complimented by the apprenticeship route as both develop skills such as communication, negotiation, problem solving, critical thinking and leadership – all skills that are important in a successful accountancy career,” he says. 

Trainees who complete the ICAEW qualification via the apprenticeship route benefit from achieving both the ACA qualification and a Master’s-level equivalent apprenticeship. This creates future finance professionals who can drive performance, providing a return on investment for their employer. 

“These days, you don't become an accountancy partner or CFO because you know how to do bank reconciliations or tax computations; career progression is far more about your interpersonal skills and behaviours. Apprenticeship programmes embed a lot of those much more important career skills at a very early stage,” John says. 

Although the overriding perception of apprenticeships among employers has shifted dramatically in recent years, the same cannot be said of many careers advisors and parents considering their children’s career options. “Most of my employers probably favour school leavers over graduates these days, which many people find surprising,” John says. In particular, bias against apprenticeships as a pathway to a professional career is still rife and bright kids continue to be pushed towards university, he believes. 

“I do worry that schools – whether it's the teachers or the careers advisors – think of what apprenticeships were 20 years ago and are giving some very outdated advice by suggesting that apprenticeships are in any way a second-class career route predominantly for manual jobs.”

Dan Miller is the founder of Young Professionals, an organisation set up to better the careers and business advice delivered in schools. Miller believes that a bias in schools against apprenticeships and towards university prevails, even though demand for apprenticeships is soaring as school leavers increasingly shun university tuition fees and the prospect of starting work saddled with huge debt. 

“There's still a lot of work to be done with some schools to highlight the benefits of apprenticeships. Young people have heard of the big firms, but they might not necessarily know about a local firm down their road that will still offer a very similar salary and put them on a path to the same qualification,” Miller says. “There are some really talented students coming out of school at 18 that just want to get into the workplace and work their way from the ground up. In some respects, that's even better because you can mould them into a certain way of working.” 

Fiona Hodgkin BFP FCA, Director, Client Relationships and Business Development at ICAEW, says: “We have many employers in industry and business benefiting from offering an ICAEW apprenticeship qualification. Not only do they benefit from the government funding available, allowing them to grow their own talent in a cost-effective way, the apprenticeship route supports the attraction and retention of staff. Investing in their own employees with the apprenticeship route develops skilled people, who strengthen their finance function and build a pipeline of future finance professionals and leaders.

“We have a dedicated team at ICAEW that can support employers interested in offering an ICAEW apprenticeship, from assessing their business needs, to setting up an apprenticeship programme and guiding them through the recruitment of their first trainee.”

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