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Getting Young People into the Trades – Why Have an Apprenticeship Scheme?

Posted by Steve Warby on

Apprenticeships provide a recognised qualification, as well as a genuine job and invaluable work experience – thereby providing the perfect pairing of training and experience, to set up apprentices and give them the skills they need to progress in their chosen career.

Schemes are open to people of any age and can be for either new recruits or your existing employees. Even those with higher qualifications can undertake an apprenticeship where they are gaining substantial new skills and knowledge…

But how can apprenticeships help your business, and the industry as a whole?

A skills gap is currently affecting many businesses in the UK, across various industries and sectors, making it difficult to fill vacancies. However, apprenticeship schemes are intended to reflect the role and industry the person will be working in, ensuring they have the right skills and knowledge for that particular workplace. So by recruiting apprentices, you can train people to have the exact skills you need for your business, therefore investing in the future of your company.

A study by the National Apprenticeship Service (NAS), part of the Education and Skills Funding Agency, found that a staggering 96% of employers which take on an apprentice report benefits to their business. Here’s just some of the reasons why…

 

Improved productivity

Of the businesses surveyed by the NAS, 76% of employers reported that productivity in the workplace had improved thanks to their apprenticeship scheme – in fact, it’s been estimated that each apprentice improves productivity by £214 a week! Just imagine what you could do with all that extra money at the end of the month…

75% also reported that apprenticeships improved the quality of their product or service. And according to work-based training provider Fareport, 82% of apprentices said the schemes had improved their ability to do the job. So by boosting productivity, apprenticeships will help your business remain competitive within the industry as well. A study by the Centre for Economics and Business Research (CEBR) even found that 8 out of 10 customers prefer to buy from companies which employ apprentices!

 

Better staff retention

What’s more, apprentices will add value to your business even after the initial training period – with 71% choosing to stay on with the company after their apprenticeship scheme has finished, according to Fareport. So not only is this good news in the short term – but it will benefit your business in the long run as well…

When it comes to finding skilled workers for the future, the NAS found that 83% of employers (who employ apprentices) rely on their apprenticeship scheme. These apprenticeships have, in turn, been shown to improve staff loyalty, with 80% of companies reporting a significant increase in employee retention. Meaning your business will have a lower turnover of employees – thus reducing recruitment costs – and will be more likely to have a motivated and satisfied workforce.

 

Cost-effective training

Apprentices spend much of their time gaining skills on the job, and may attend a Skills Training UK Centre one day a week. Because of this, apprenticeship schemes are particularly cost-effective as a form of training, because young people are able to contribute to the workplace whilst learning. And 59% of businesses surveyed by the NAS reported that training apprentices is more cost-effective than hiring skilled staff, with 595 employers believing that apprenticeships lead to lower overall training costs.

 

But how much will it actually cost you? Surely only big corporations can afford to run an apprenticeship scheme, right? Wrong.

While you are expected to pay your apprentices’ wages (minimum £3.50 per hour), funding is available to cover many other training costs. In April 2017, the government introduced an ‘Apprenticeship Levy’ of 0.5%, which there has been much discussion about, but less than 2% of businesses will have to pay this. There is a £15,000 annual tax free allowance, meaning you will only pay the levy if your payroll exceeds £3 million per year.

Smaller employers, whose annual payroll is less than £3 million, only need to pay 10% of apprenticeship costs – the government will pay the remaining 90%. And if you have less than 50 employees and train a 16-18 year old, the 10% employer contribution will be waived – so an apprenticeship scheme is completely feasible for smaller businesses as well. What’s more, you’ll even be eligible for a £1000 ‘Employer Incentive’.

The benefits of employing an apprentice are clearly tenfold – both in the short term and in the long run. Not to mention, it’s great for the industry to get young people into the trades – who will eventually become highly skilled and professional tradespeople. And thanks to government funding, running a scheme is achievable for small and large businesses alike. If you need further advice on how to go about setting up a scheme, check out this employer guide to apprenticeships.

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