A group of leading businesses, including Sage and the Co-op, is calling for action after the North East saw the biggest drop in people starting an apprenticeship of any English region.

Between August 2020 and April 2021, there were just 13,500 new apprentices in the region compared with 18,500 in the same period between 2018 and 2019.

By comparison, the number in London fell by just 2,400 - a drop of 8%.

The total number of people starting an apprenticeship in England has fallen by 58,000 over the past two years, a drop of 19%.

The impact has been even worse in the North of England, where the number dropped by 23,000 – a 22% decrease.

The Northern Coalition on Skills, led by Northern Powerhouse Partnership, hopes to return apprenticeship numbers to pre-pandemic levels as part of a plan to supercharge the skills agenda and create more opportunities for people outside London and the South East through reform to the apprenticeship levy.

According to research from the Northern Powerhouse Partnership, the North-South skills gap has widened in recent years and businesses say this is holding back the North back from reaching its full potential.

However, there are signs that better progress is being made in several of the North’s strategically important economic priorities including green energy, digital and health innovation.

Leaders say it is vital for businesses based in the North of England to be able to access a highly skilled, highly trained workforce in order to increase productivity and rebalance the UK economy.

In 2019/2020, businesses lost out on more than £300million in skills funding from the government, as they failed to spend their full allocation due to rules about how the money can be used.

This figure has risen even higher during the pandemic and the coalition says changes are needed to allow more of the Apprenticeship Levy, introduced by former Chancellor George Osborne in 2015, to be transferred into supply chains.

Paul Struthers, UK&I Managing Director, Sage said: “As one of the largest employers in the North East of England, Sage has a key role to play in developing the tech talent of the future. As the skills gap widens and businesses attempt to recover from the damaging effects of the pandemic, there is a golden opportunity for the business community to work with local government and growth hubs to unlock our region’s potential.

“Creating more apprenticeships will not only boost productivity and growth of the economy but will help local people gain the skills needed for the jobs of the future, while potentially empowering a new wave of entrepreneurs.”

Sarah Mulholland, Head of Policy at the Northern Powerhouse Partnership said: “A skilled, well-paid workforce is the backbone of a productive economy.

“The North has the history, the expertise and the tools to lead a fourth industrial revolution.

"We now need government and businesses to work together to level up opportunity across the country and close the North-South divide in skills for good.”