Check against delivery. First delivered to the BPP Conference on Apprenticeships in the Travel Industry in February 2025.
I want to address an issue critical to the future of the business travel industry today: how apprenticeships can help solve skills shortages, improve recruitment and retention, and drive growth.
According to the CBI, the business travel sector is a cornerstone of the UK economy, contributing £27.5 billion annually in gross value added (GVA) and supporting 283,500 full-time equivalent jobs.
However, like many industries, it faces significant challenges in finding and retaining skilled workers. For example, the wider travel and tourism sector has an 8.3% skills gap, higher than the average of 6.5% across other Department for Culture, Media and Sport sectors (DCMS Sectors Economic Estimates, 2023).
Apprenticeships offer a transformative solution to these challenges. They provide structured training pathways that build talent pipelines while addressing sector-specific skills gaps.
1. Industry Context & Current Challenges
The business travel industry has demonstrated remarkable resilience post-pandemic. By 2024, business travel spending in the UK was expected to recover to pre-pandemic levels. However, this recovery has been accompanied by persistent challenges.
Skills Shortages in the Travel Sector
The UK travel and tourism sector faces one of the highest skills shortages across industries:
Skills Gap Data: The sector has an 8.3% skills gap, compared to an average of 6.5% across other DCMS sectors (DCMS Sectors Economic Estimates, 2023)
According to the Office for National Statistics (ONS) Labour Market Overview for the Hospitality and Tourism sector, published in September 2023:
- The tourism and hospitality sector faced significant recruitment challenges
- Job vacancy rates in the sector were approximately 6.2% higher than the overall UK average
- Approximately 49,000 vacancies were reported in the travel and tourism subsector in Q3 2022
(ONS Labour Market )
Recruitment Challenges:
A survey conducted by UK Inbound in 2023 found that 23% of inbound tourism businesses identified staff recruitment as their most significant barrier to growth** (UK Inbound Member Survey, 2023)
These shortages are exacerbated by rising demand for domestic and international travel.
For example:
- In 2023, UK residents spent a record-breaking £72.4 billion on overseas travel, £10.1 billion more than pre-pandemic levels (ONS Travel Trends Report, 2023).
- ABTA research shows that consumers are now **37% more likely to use a travel professional than before the pandemic, increasing demand for skilled workers (ABTA Holiday Habits Report, 2023).
As demand grows, businesses must adopt innovative workforce solutions to remain competitive.
2. The Business Case for Apprenticeships
Apprenticeships provide a practical pathway to solving skills shortages while delivering tangible business benefits.
Direct Impact on Staff Retention
Investing in apprenticeships fosters loyalty among employees. Studies show that 60% of apprentices stay with their employer after completing their training** (National Apprenticeship Service Report, 2022).
This reduces turnover costs and builds a stable workforce.
Cost-Effective Talent Development
Apprenticeships allow businesses to develop talent internally rather than relying on costly external recruitment:
- Apprentices generate an average revenue of £33,759 annually for their employers ([CIPD Apprenticeship Report, 2022)
Investing in apprenticeships can significantly reduce recruitment costs over time. Traditional hiring processes in the UK can be expensive; for instance, the Chartered Institute of Personnel and Development (CIPD) reported that the median cost of recruiting senior managers is £3,000, while other employees cost around £1,500. Apprenticeships offer a cost-effective alternative, thanks to government funding contributions towards training costs. Additionally, training providers such as BPP will assist with various aspects of the apprenticeship process.
Building Internal Expertise
By training apprentices in digital, technology, marketing, management, or other business programmes, companies can develop highly skilled employees tailored to their specific needs. This approach reduces dependency on external hires while improving overall productivity.
Success Stories from the Sector
Several companies have embraced apprenticeships with great success:
Blue Cube Travel: Their apprenticeship programme improved customer service quality while integrating sustainable practices into operations.
Good Travel Management: One apprentice progressed from entry-level to team leader over seven years with the company and has gone on to become a Member of the Generation BTA Board. Good Travel’s programme supports both upskilling existing staff and recruiting new talent. This apprentice is a perfect example of a successful apprenticeship.
Clarity Business Travel: “WE HAVE HEARD FROM CLARITY TRAVEL”, ABOUT THE SUCCESS OF APPRENTICESHIPS AND THE IMPACT ON THEIR BUSINESS”
These examples highlight how apprenticeships can deliver measurable results.
3. Breaking Age Barriers
Apprenticeships are no longer just for school leavers; they offer opportunities for people at all stages of their careers.
Challenging Stereotypes
The traditional image of apprenticeships as being only for young people is outdated: In 2023, 48% of all apprentices were aged 25 and over
- Over 70% of workers aged 55+ are open to joining sectors such as the travel sector if given appropriate training opportunities.
- Career switchers increasingly view apprenticeships as a way to gain new skills while earning a salary.
Multi-Generational Workforce Benefits
A diverse workforce brings fresh perspectives and fosters innovation. By offering apprenticeships across all age groups, businesses can tap into a broader talent pool while creating inclusive workplaces.
4. Policy Updates & Opportunities
The UK government has introduced several reforms to make apprenticeships more accessible and flexible:
Evolution of the Levy
In 2022-23 alone, the Apprenticeship Levy generated £3.58 billion in England. Of this:
- £2.55 billion was allocated for apprenticeship funding.
the DfE underspent its budget by £96 million, meaning the total savings to the Treasury hit £514 million in 2022-23 (FE Week
This represents a significant missed opportunity for businesses.
To address this, recent reforms have introduced greater flexibility:
- Employers can now transfer up to 50% of unused levy funds to smaller businesses within their supply chain.
- Accelerated apprenticeships allow experienced workers to complete training faster by recognising prior learning (Department for Education Skills Plan Update, 2024)
The new Government's reforms
The Government will keep the Foundations of the Apprenticeship system, however, the reforms are based on several key principles:
Consolidation - the new Skills England bringing together all skills bodies, setting skills policy, devolving skills to Mayoral authorities, working and leading cross-government skills policy e.g. NHS workforce and Migration issues;
Priorities: focus on skills for economic growth and in key skills deficit areas e.g. STEM/Medical/Bioscience/Construction/green skills;
Variation - New Growth and Skills Levy. Some of the Apprenticeships Levy (amount yet to be determined - but likely to be much lower than 50% - as was previously suggested) to be focused on other skills qualifications, e.g. Pre Apprenticeships/Foundation Apprenticeships and shorter Apprenticeship programmes;
Social Justice and opportunity - more focus on young people; getting rid of many Level 7s to rebalance funding towards young people and Levels twos and threes;
Devolution: acceleration of adult skills devolution to devolved authorities.
Conclusion: A Call to Action
Consider these facts:
- The UK travel sector faces an 8.3% skills gap, higher than other industries in the cultural arena.
- Over £514 million in levy funds went unspent last year alone.
Now is the time to act:
1. Reclaim your levy funds before they expire.
2. Explore apprenticeship standards tailored to your needs.
3. Leverage Labour’s skills agenda to access new funding and training pathways.
4. Promote lifelong learning through initiatives like HTQs and LLE.
5. Foster collaboration across your supply chain to maximise impact.
By embracing these opportunities today, you can build a stronger industry capable of thriving well into the future.
Thank you very much.
