Are you fully utilising the Growth and Skills Levy to support your business, team and the wider industry?

The UK beauty industry is a multi-billion pound powerhouse built on service, creativity and innovation. As we enter National Apprenticeship Week, we’re speaking to Sue Fox, British Beauty Council Board Member and former President of Estée Lauder UK & Ireland to discuss the Government’s recent transition to the Growth and Skills Levy and how businesses big and small can get most value from apprenticeships.

What is the Growth and Skills Levy?

The Growth and Skills Levy is the Government’s updated funding system designed to help businesses invest in their teams. While the core mechanism remains similar—large employers contribute a small percentage of their payroll into a digital pot—the rules on how that money can be spent are intended to be much more flexible.

The most significant updates for 2026 include:

• From April 2026, the levy can be used for shorter, modular ‘apprenticeship units’ rather than just full-length qualifications.
• The minimum duration for certain apprenticeships has been reduced to 8 months (down from 12), allowing for quicker up-skilling in fast-paced retail or salon environments.
• Entry requirements for English and Maths have been streamlined for adult learners, removing barriers for talented professionals who excel in practical skill sets.

How can your business utilise the Levy?

Whether you are a global beauty brand or a local high-street salon, there is a pathway for you to benefit from this funding.

If you are a larger employer with a pay bill over £3 million, you will already be contributing to your Digital Apprenticeship Service (DAS) account, but may not be utilising the Levy for maximum benefit:

• Use your funds to train existing staff in new areas like AI-driven skin analysis, sustainability management, or digital marketing.
• Levy funds will expire after 12 months (reduced from 24) from April 2026, so it is vital to plan your training calendar early to ensure your contributions stay within the industry.
• You can transfer up to 50% of your unused funds to smaller businesses in your supply chain or local community. By doing so, you support the wider beauty ecosystem and ensure the high street remains vibrant and professional.

For SMEs, if your annual pay bill is under £3 million, you do not pay into the levy. However, you can still access its benefits:

• The Government now covers 100% of training costs for apprentices aged 16–21, and up to age 24 for care leavers.
• For apprentices over the age of 25, the Government pays the vast majority of training costs, leaving you with a small 5% contribution. This will shift to a 25% contribution for some older learners from April 2026—making now the best time to recruit.
• You can receive funds from larger companies like major beauty retailers or manufacturers to cover your training costs entirely.

How can SMEs get access to Levy funds?

To receive funds, both the large “sending” business and the “receiving” SME must follow a specific digital workflow through the Apprenticeship Service and follow the following steps:

1. Set Up Your Digital Account

• You must register for an Apprenticeship Service (AS) account.
• You will need your Government Gateway login, your PAYE scheme reference, and your Accounts Office reference number.

1. Find a “Sending” Employer

There are two primary ways to connect with a large business that has surplus funds:

• Large employers often create “pledges” on a public government website. You can search these pledges by location, sector (e.g., “Beauty” or “Retail”), or job role (e.g., “Digital Marketing” or “Sustainability”) and apply directly.
• If you already have a relationship with a large brand or supplier (like a major cosmetic manufacturer), they can invite you to a “connection” if you provide them with your Account ID.

1. Application & Approval:

• Once you apply for a pledge, the large employer reviews your request.
• If they approve, the funds are “committed” to your apprentice for the entire duration of their training.
• Important: Transferred funds can only be used for new apprenticeship starts, not for staff who have already begun their training.

Why Beauty Needs Apprenticeships Now

The beauty industry contributes billions to the UK economy, yet we face persistent skills gaps. Apprenticeships are no longer just for “beginners”; they are a mechanism for lifelong learning.

The Council encourages all beauty businesses to audit their current skills needs and explore how a foundation apprenticeship or a new short unit could transform your team and business.

British Beauty Council Board Member Sue Fox, emphasises that for the new levy model to succeed, it must work for the 95% of our industry made up of small and micro-businesses.

“The new levy isn’t just for hair and beauty technical skills; it is designed to support high-growth, non-technical areas. Businesses should therefore think more broadly about the skills that the levy could help develop within your business.”

This can include training and up-skilling in:

• Digital & AI: Automating booking systems, using AI for skin analysis, and mastering data trends to personalise the client journey.
• Sustainability: Training “Green Tech” specialists to manage ‘extended producer responsibility’ (EPR) and sustainable packaging design.
• Product & Science: Developing apprentices in cosmetic science, formulation, and fragrance through STEM-focused pathways.
• Marketing & Creative: Building internal expertise in digital storytelling, brand management, and social commerce.

Finally, Fox warns levy-paying businesses to ‘use it or lose it’. Noting that large businesses should be aware that from April 2026, levy funds will expire after 12 months. This shift makes it critical to plan your 2026 intake now. “If you cannot use your full allocation, consider a levy transfer to support a smaller business in your supply chain—keeping the investment within our industry.”

These transfers are essential for an industry where 95% of businesses are small or micro-enterprises that do not pay the levy themselves. By utilising these funds effectively, we can drive much needed skills into our industry, future-proofing it for the beauty industry of tomorrow.