The last ten years has seen a gold rush of global private equity (PE) companies seeking to make the most of the opportunities presented by the apprenticeship levy by pouring their money into England’s independent training providers.
But PE owners are being hit by a double whammy of lower profit margins in the apprenticeships training sector and higher interest rates on their debts, casting doubts over whether some can keep propping up this part of the skills sector.
Several high-profile training providers – either partly or wholly owned by foreign investors – are now downsizing, or have gone under completely. The Association of Employment and Learning Providers (AELP) recently warned that urgent action is required to prevent “total collapse” of the publicly funded training system.
Skills consultant Aidan Relf believes that with “margins squeezed” in the absence of apprenticeship funding rate increases, “the probability of investment failures and unplanned exits increases”.
