Six months after its introduction, businesses are still unsure about how best to use the Apprenticeship Levy, according to new research.

A survey of over 1,400 businesses conducted by the British Chambers of Commerce (BCC) in conjunction with Middlesex University London has found that 23% of of levy-paying firms have no understanding of the Apprenticeship Levy or don't know how their company will respond to it.

For over half of levy-paying businesses, it represents an added cost, with 56% not expecting to recover any or only a portion of their payment, compared to 36% who expect to recover all or more of their payment.

Businesses with a pay-bill of less than £3m fall under the levy threshold but can still apply for apprentice funding, yet the findings also show that 66% of these companies haven't taken any direct action to use the funds or don't know about it.

The BCC says these findings reinforce the need for clearer guidance and support for businesses wanting to use the Apprenticeship Levy.

Jane Gratton, the BCC's head of business environment and skills, said: "The current upheaval in the technical education and apprenticeship system will take time for firms to understand and adapt to. The Government must ensure that changes in the system do not lead to a slowdown in the overall number of apprentices recruited, or less investment in other forms of workplace training."

The situation has not been helped by uncertainty faced by training providers tasked with delivering apprentices to business, she added.

"Our survey shows that many firms are still unaware of the Apprenticeship Levy and how it will impact on their business. With many companies across the country facing critical skills shortages, more information and support is required to ensure businesses continue to invest in training."

David Williams, director of corporate engagement at Middlesex University London, said: "The opportunities that arise from the apprenticeships levy - together with robust workforce planning - could be transformative for businesses so it is essential that gaps in information and support around this initiative are addressed."

  • Prompt, efficient and clear communication, helped provide a clear understanding of the issues and situation