Education and Skills Impact Framework (ESIF) - modern apprenticeships provision: contextual summary report 2022

Benefit to Individuals

Introduction

The following section covers the difference in earnings, employment and benefit dependency related to completing an MA qualification. These are calculated by comparing the outcome for successful MA completers to a control group via regression analysis. In addition, control variables are used to account for differences in characteristics including academic year of completion, ethnic group, disability status, SIMD quintile and region of residence.

For MAs the control group used is non-completers. In essence this answers the question of what are the benefits to the individual of achieving an apprenticeship compared to those who drop out?

Earnings

Table 7 presents the estimated earnings returns for MAs at level 2 and 3, three years after completion (broken down by gender and age at completion), with respect to a non-completer control group. Earnings returns are interpreted as the percentage difference in daily earnings of an individual in possession of a given qualification relative to a control group. For example, results suggest that males who completed a level 3 MA at 21 years or younger receive earnings that are, on average, 52.1% higher than the ones experienced by a group of non-completers with similar characteristics. Treatment and control group sample sizes are presented in Appendix 2.

‘Unavailable’ denotes results where the underlying sample size is 100 or less

Key findings:

• There are positive returns across almost all age groups and VQ categories for male and female MAs, representing consistently higher earnings for MA completers, with respect to non-completers.
• These differences are likely to be partly driven by differences in the underlying occupational framework studied. Although not shown in detail here, the results indicated that earnings returns to MAs in STEM subjects are generally greater than for non-STEM subjects.
• The returns to MAs at Level 3 are generally larger for male MAs than for female MAs (with the exception of the 31+ age range).
• The largest returns are found for male MAs in the 21 or younger category.

Employment

Table 8 presents estimated employment returns for MAs at level 2 and 3, three years after completion (broken down by gender and age at completion), with respect to a non-completer control group. Employment returns refer to the percentage point difference in the proportion of the year that an individual with a given qualification spends in employment relative to a control group. For example, results suggest that female apprentices who completed a level 3 MA at 21 years or younger are, on average, in employment for 12.6 percentage points more of the year compared with non-completers with similar characteristics.

Key findings:

• Strong and positive returns across all categories, indicating that on average MA completers spend a higher proportion of the year in employment, with respect to non-completers.
• In contrast to the previous findings, the analysis indicates that these marginal employment returns tend to be greater for female MAs than for male MAs.
• The returns to level 3 MAs were similar across occupations, but where identified, level 2 STEM Modern Apprenticeships provided a larger employment boost than other occupation groups.

Welfare benefit dependency

Table 9 presents estimated benefit dependency returns for MAs at level 2 and 3, three years after completion (broken down by gender and age at completion), with respect to a non-completer counterfactual. Benefit dependency returns are interpreted as the percentage point difference in the likelihood of receiving welfare benefits at any point in a given year between the treatment and a control group. For example, results suggest that male apprentices who completed a level 2 MA at age 22 to 30 are 27.1 percentage points less likely to receive welfare benefits, compared to a group of non-completers with similar characteristics. In this case, a negative figure indicates a more favourable result.

‘Not sig’ denotes that the estimated return is not statistically significant

Key findings:

• Most MA levels are associated with significant, positive reductions in benefit dependency.
• Findings also indicate that these benefit dependency returns tend to be smaller for female MAs than for male MAs.