National Minimum Wage

National Minimum Wage
3.52 We continue to recognise and support the value of work experience opportunities to young
people. However, the evidence has again highlighted the potentially damaging impact of
unpaid internships on social mobility by inhibiting labour market access for particular groups
who cannot afford to undertake them. We are also concerned that labelling opportunities as
internships may be seen as a loophole to undermine the minimum wage. We therefore
consider the legal position on payment of the NMW while undertaking a period of work
experience, including internships, in Chapter 4. However, we next turn to another type of
in-work training, apprenticeships, which have seen a rapid expansion of places during the
past year.
Apprentices
3.53 As well as reviewing the labour market position of young people in apprenticeships our remit
asked us to review and make recommendations on the Apprentice Rate as part of the
consideration of each of the minimum wage rates. This section covers the former and first
provides the context of the labour market for apprenticeships, setting out the latest data on
numbers of apprentices and in particular their age profile. It then looks at data on apprentice
pay and hours, before presenting the evidence to date on the impact of the Apprentice Rate.
Our recommendation on the future level of the Apprentice Rate is presented in Chapter 5.
Apprenticeship Starts
3.54 This section looks at the latest available data on apprenticeship starts. Policy on education
and training is devolved to each UK administration, whereas the NMW applies UK-wide. All
the administrations support and value expansion of apprenticeships, although their specific
policies sometimes differ.
3.55 Table 3.1 shows that in 2010/11 the expansion of apprenticeships across the UK continued.
Scotland slightly improved upon the substantially higher number of starts seen in 2009/10,
and has an even higher target of 25,000 in 2011/12. Starts in Northern Ireland increased in
2010/11 following a plateau the previous year. Wales also experienced an increase after a
slight fall in 2009/10. However, by far the largest expansion was in England, where there was
a rise of nearly 60 per cent on 2009/10 (based on near-final data for the 2010/11 academic
year). This in large part reflected the Government’s apprenticeship policy initiatives, with
increased funding and highest priority given to apprenticeships as the key route for vocational
training. The less traditional apprenticeship sectors experienced the highest increases in
2010/11 (e.g. starts on the customer services framework increased by about 24,000), with
traditional sectors, such as engineering (an increase of about 3,000 starts) and construction
(an increase of about 1,000 starts) making smaller contributions to the overall rise. In the
lower-paying apprentice sectors, children’s care, learning and development starts increased
(by over 6,000), while total starts in hairdressing remained broadly flat compared to the
previous year (down 140 starts).
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