Apprenticeship starts in England rose 8.7% in the first three quarters of the 2025/26 academic year, to 308,770 — up from 284,190 at the same point a year earlier, according to Department for Education figures published on 16 July [1]. Achievements grew faster still, up 14% to 146,210, and total participation reached 735,500, up 4.6%. After years in which starts drifted sideways or down, this is the firmest evidence yet of a rebound — and it has landed in precisely the year the funding system beneath it was rebuilt.
The context makes the number more striking. Advertised graduate vacancies fell to 8,398 in May, down 42.1% in a year — the steepest annual decline Adzuna has recorded, and lower than at any point during the pandemic [2], as our analysis of the 2026 graduate market sets out. Members of the Institute of Student Employers cut graduate hiring by 8% in 2024/25 while raising apprentice hiring by the same margin, compressing the graduate-to-apprentice hiring ratio from 2.3:1 to 1.8:1, with 1.6:1 forecast [3]. Employers are not walking away from early talent; they are rerouting it. The apprenticeship route is where the traffic is going.
What replaced the apprenticeship levy?
The apprenticeship levy has not been abolished — it has been rebuilt. Since April 2026, England's system has operated as the Growth and Skills Levy, and the practical difference for employers is flexibility [4].
The first change is what levy money can buy. A first wave of "apprenticeship units" — short courses of 30 to 140 delivery hours carved out of existing apprenticeship standards — launched in shortage areas including AI leadership, electric vehicle charging, electrical and mechanical fitting, solar PV installation and mechanised welding. Levy payers can draw on their levy funds; non-levy employers get the units fully funded. There is an age floor of 19, and the target is upskilling people already in work rather than recruiting new entrants [4].
The second change is at the entry level. Foundation apprenticeships — level 2 programmes lasting at least eight months, open to 16-to-21-year-olds, and up to 24 for care leavers, prison leavers and those with an education, health and care plan — expanded in April into catering and hospitality, and retail service, supply and administration. They join construction, digital, engineering and manufacturing, and health and social care. Employers taking on a foundation apprentice can receive up to £2,000 per apprentice [4].
None of this is conjured money. To pay for the wider offer, the DfE is withdrawing funding from 16 apprenticeship standards from September 2026 as part of the £725 million Growth and Skills Levy package [4]. Employers planning autumn starts should check whether their standard is affected before committing.
What money is on the table for employers this autumn?
The levy reform sits inside a £1 billion youth employment package announced in March, which took combined Youth Guarantee and Growth and Skills Levy investment to £2.5 billion over three years and targets 200,000 jobs and apprenticeship opportunities [5]. Two employer-facing payments matter most.
The first is aimed at smaller firms. The 2026–27 apprenticeship funding rules confirm that non-levy employers will receive a £2,000 hiring payment for each new apprentice aged 16 to 24 starting from 1 October 2026, with government also funding the training costs of 16-to-24-year-old apprentices at non-levy employers [6].
The timing detail matters: the payment applies to starts from 1 October, not before. On our reading of the funding rules, an employer locked into a September intake forgoes it, while one able to shift a start date by a few weeks captures £2,000 per apprentice — a detail worth verifying against the final 2026–27 rules before committing either way.
The second is already live. Since 30 June, employers across Great Britain have been able to claim a £3,000 Youth Jobs Grant for hiring an 18-to-24-year-old who has been out of work and on Universal Credit for six months or more [7][8]. Payment is staged and verified through HMRC Real Time Information: £1,800 after six weeks and at least 50 hours worked, then £1,200 after 18 weeks and at least 300 hours. The job must be genuine paid work of at least 25 hours a week lasting at least 16 weeks, and the employer needs an active PAYE scheme, a D-U-N-S number and six months' trading history [7].
| Support | What it is worth | Who qualifies | Status |
|---|---|---|---|
| Apprenticeship hiring payment | £2,000 per new apprentice aged 16–24, plus fully funded training | Non-levy (smaller) employers in England | Applies to starts from 1 October 2026 [6] |
| Youth Jobs Grant | £3,000 per hire, staged (£1,800 + £1,200) | GB employers with an active PAYE scheme, a D-U-N-S number and 6 months' trading, hiring an 18–24-year-old on Universal Credit for 6+ months; job of 25+ hrs/week for 16+ weeks | Live since 30 June 2026; closes to new vacancies October 2028 [7] |
| Foundation apprenticeship support | Up to £2,000 per apprentice | Employers taking on 16–21-year-olds (up to 24 for care leavers, prison leavers and EHCP holders) on level 2 foundation routes | Live since April 2026 [4] |
| Apprenticeship units | Fully funded short courses of 30–140 hours | Non-levy employers upskilling staff aged 19+ in shortage areas; levy payers use levy funds | Live since April 2026 [4] |
On our analysis, the arithmetic for a small employer hiring young this autumn is unusually favourable: the apprentice minimum wage — which applies to apprentices under 19 and to any apprentice in the first year of their apprenticeship — has stood at £8.00 an hour since 1 April [9], and a 16-to-24-year-old apprentice starting on or after 1 October brings a £2,000 payment plus free training. The £3,000 Youth Jobs Grant is a separate scheme with its own eligibility test — an employer should confirm against the official guidance how the schemes interact before budgeting on receiving more than one payment for the same hire.
Where is the story weaker than the headline?
An 8.7% rise in the year the levy changed invites an obvious causal reading: the reform worked. The data does not yet support that. The reporting period — August 2025 to April 2026 — includes just one month of the new levy offer and ends five months before the £2,000 hiring payment takes effect. Whatever drove the rebound was substantially in motion before the incentives arrived. The November release, covering the full academic year, will be the first genuine test of the new system [1].
Three details complicate the celebration. First, the level 7 wrinkle. Masters-level apprenticeship starts rose 11.6% to 28,800 in the period [1] — yet government funding for level 7 was withdrawn for most adult starters from 1 January 2026, with support maintained for 16-to-21-year-olds and apprentices already in training [10]. Level 7 recorded 23,860 starts and just under £240 million of spend in 2023–24 [11]. The plausible reading — and it is a reading, not a finding — is that part of this year's growth is a rush through a closing door, borrowed from future years.
Second, foundation apprenticeships — the flagship new entry route — recorded just 160 starts in the year to April [1]. New programmes always build slowly, but 160 is a rounding error against 308,770.
Third, apprenticeships are not primarily a school-leaver story. Some 52.4% of this year's starters were 25 or over; only around one in five was under 19 [1]. The headline growth says at least as much about adult retraining as about first jobs.
Why does demand only point one way?
Whatever November shows, the structural forces lean in a single direction. Skills England's first annual report, published 1 June, projects demand in its priority sectors growing 24% over the next decade, requiring up to 1.8 million additional workers — while nearly one million 16-to-24-year-olds are not in education, employment or training [12]. The assessment spans ten priority sectors — the eight named in the Industrial Strategy plus construction and health and social care [16] — and among the challenges it names are weak employer investment in training, particularly by smaller firms, and young people's work-readiness [12][16].
Immigration policy pushes the same way. The Migration Advisory Committee's Temporary Shortage List verdict, published 23 July, recommends keeping visa access for only 28 medium-skill occupations — and for 18 months rather than the standard three years — with access conditional on credible sector plans to grow the domestic workforce. The committee's position is that "no industry is allowed to rely solely on immigration to fill its skills shortages" [13]. The recommendations await a government response, but the direction is unambiguous: employers who can no longer sponsor technicians and trades will have to train them.
Construction shows what that looks like on the ground. Government figures cite more than 35,000 construction vacancies, over half attributed to a lack of required skills, and £96 million has now been allocated to fund building-site placements for construction learners starting courses from September 2026 [14].
What should school leavers — and their parents — take from this?
For an 18-year-old weighing options this summer, the two markets are moving in opposite directions: advertised graduate vacancies are lower than at any point during the pandemic [2], while apprenticeship starts, achievements and participation are all rising [1].
The pay comparison deserves honesty rather than cheerleading. ISE members' average graduate scheme salary is £33,000 against £24,000 for apprentice starters [3], and the median salary for 2023/24 first-degree graduates in full-time UK employment, measured 15 months after finishing, was £30,000 [15]. On starting pay, a degree still commands a premium. What has changed is the risk profile: an apprentice is paid from day one, accrues no tuition debt, and enters a market where employer demand is growing rather than shrinking. The new foundation routes also open structured, funded entry paths into catering and hospitality, and into retail service, supply and administration [4]. Nor is the growth confined to entry level: higher apprenticeships — level 4 and above — grew fastest of all, up 13.6% to 126,660 starts [1], meaning the route now runs to degree level and beyond, not just to a first job.
One caution: the same rebalancing that makes apprenticeships attractive makes them contested. As employers shift early-careers budgets from graduate schemes towards apprenticeships [3], more candidates — including graduates — are likely to be competing for those places.
The practical response mirrors what employers are doing: go to where the other side of the market is. Engineering and manufacturing sit at the centre of both the Skills England assessment and the MAC's shortage list, and employers in those sectors recruit visibly each autumn — the Sunderland Careers Fair on 23 September and the Derby Careers Fair on 24 September both sit in engineering heartlands. Apprenticeship and entry-level vacancies from employers at our events also appear on our jobs board. For families planning further ahead, our 2027 University & Apprenticeship Expos run across five destinations from September 2027, built for exactly this decision.
The autumn window
The pieces align in October: the £2,000 hiring payment applies to starts from the 1st [6], the Youth Jobs Grant is claimable now [7], and November's data will show whether the rebound is structural or a one-year bounce. On the incentives now in place, the next three months look to us like the cheapest moment in years for an employer to test the apprenticeship route; on the data, this is the strongest apprenticeship market school leavers have faced in years — with more competition for it. Both sides can start in the same room: the autumn careers fair schedule runs from late August into November, in towns and cities across the UK, and every event is free for candidates to attend.