EMPLOYER investment in training has fallen since the introduction of an apprenticeship levy, highlighting a need to reform the “failed” policy in the Budget, according to a new study.

The Chartered Institute of Personnel and Development (CIPD) said its assessment was “damning,” showing that apprenticeship starts have fallen and far fewer have been offered to young people.

The professional body is urging the government to use the Budget to reform the initiative into a more flexible training levy.

Total apprenticeship starts have fallen from 494,900 in 2016/17 to 322,500 in 2019/20, said the CIPD — and the number going to under-19s has fallen from 122,800 to 76,300 in that time.

The CIPD warned that without reform, the levy will have further damaging effects on investment in skills.

CIPD chief executive Peter Cheese said: “On all key measures the apprenticeship levy has failed and is even acting to constrain firms’ investment in apprenticeships and skills more broadly.

“It appears to have achieved the opposite of its policy objectives. Without reform, it will act as a handbrake on employer investment in skills, damaging firms’ ability to recover from the pandemic.”

Mr Cheese said that a more flexible skills levy would mean employers could use it to develop existing staff through other forms of accredited training and skills development, which are cheaper and usually much more suitable for employees aged 25 and over.

He said this would leave more money to invest in apprenticeships for young people who most need them.

A Department for Education spokesman said the levy is an important part of apprenticeship reforms, which are vital for driving economic recovery.