Apprenticeships

The Value of Apprenticeships

According to Accountancy Age, a huge 86% of employers currently recruit apprenticeships, and it is positive to see that 50% intend to hire more apprentices in the next five years than they do now. (Accountancy Age: 2018)

What is it that makes the apprenticeship scheme attractive and how could it benefit your business?

What are apprenticeships?

An apprenticeship provides individuals with a wage whilst working towards a nationally recognised qualification. They fulfil a genuine job role alongside some off-the-job training, boosting the skills in your workplace.

They are available in four levels; Intermediate, Advanced, Higher and Degree. The level of apprenticeship is determined by the qualification the individual will gain upon completion, ranging from level 2 to level 7.

How do they work?

During their apprenticeship, individuals must spend at least 20% of their time on academic training away from day-to-day workplace duties. The method for this training is decided between the employer and the training provider that validates the apprenticeship and provides the framework. It may be onsite workshops or regular day-release to an educational facility like college.

The training must be relevant to the apprenticeship framework. As the apprenticeship is a mix of practical and theory, all training will be reinforced when the individual is completing their workplace duties.

What are the benefits of hiring apprentices?

We’ve covered the value to the apprentice, but how will this benefit your business directly? And why is it becoming more and more popular with employers? “Apprenticeship participation now stands at a record level – there were 491,300 apprenticeship starts in the 2016 to 2017 academic year”. (Education & Skills Funding Agency: 2017)

Skills Gap

Most have been there at some point: advertising for a new vacancy but struggling to find someone with the necessary skills. Hiring an apprentice means that you can have the individual trained up in a specific area where others may lack knowledge. In a poll carried out by the UK Government “86% of employers said that apprentices helped to develop relevant skills for the organisation, and to fill the skills gap.” (National Apprenticeship Service: 2018)

Unbiased employees

As it’s the beginning of their training in that area, apprentices are generally ‘fresh’ to the role. Therefore, everything they learn will be applicable to your business, meaning no biased views from previous experience. You can effectively ‘mould’ the perfect employee.

Decrease in staff turnover

When you hire an apprentice, you invested in their development, so they aren’t likely to leave after a short period of time. You’ll also likely be their first full time employer, so they’ll feel a great sense of loyalty to your business. 65% of apprentices stay working for the company that trained them when they complete their apprenticeship.”  (National Apprenticeship Service: 2018)

Improved productivity and service quality

Employers who have an established apprenticeship programme reported that productivity in their workplace had improved by 76% whilst 75% reported that apprenticeships improved the quality of their product or service.”  (Chartered Management Institute: 2017). Numbers you can’t argue with.

Funding  – The Apprenticeship Levy

Expanding your workforce costs money and staff time. Apprenticeships reduce these associated costs as there is funding available for hiring apprentices.

  • The Apprenticeship Levy dictates that employers with a wage bill of over £3 million will pay 0.5% of it into the Government’s apprenticeship service, paying for apprenticeship course fees.
  • Employers who pay this levy can access the funds they’ve paid through a digital account where the government contributes an additional 10%.
  • In the recent Autumn budget 2018, the Chancellor announced that the contribution required from small businesses would be halved from 10% to 5%.
  • You’re entitled to a £1000 incentive payment when you recruit a 16-18-year-old apprentice or a 19-24-year-old apprentice who has an Education, Health and Care (EHC) plan. Any funds which remain unused in 24 months expire.
  • If your company headcount is more than 50, but aren’t required to pay the levy, then you will pay 10% of training costs instead.
  • Companies with a headcount below 50 with a training cost in the maximum funding band don’t pay anything towards training an apprentice under 18 or apprentices aged 19-24 with an EHC plan.

Employers who do not pay the Apprenticeship Levy will be entitled to the same apprenticeship funding as those who do. Find out more about apprenticeship funding in England.  

Enhance skillset of existing staff

Apprenticeships aren’t always about hiring new people, you can upskill your existing staff by making them an apprentice. Once qualified they could receive a promotion which will reduce recruitment expenditure. This will also improve future recruitment as you’ll be viewed as a preferable employer with good development opportunities. “69% of employers say that employing apprentices improved staff retention.” (National Apprenticeship Service: 2018)

Fresh ideas

Most apprentices are young, so they bring fresh, vibrant ideas which you may not get from someone who has been working in the industry for years. They may also have skills with emerging technology and software that older employees have not used.

Hiring your apprentice

So, like what you hear? Are you ready to see the value you can gain from hiring an apprentice?

There are several steps to taking on an apprentice.

  1. First you must choose an applicable apprenticeship framework or standard for your industry and at a suitable level.
  2. Next you need to find an organisation that offers the relevant training for the apprenticeship framework or standard you’ve chosen.
  3. After that you can check what funding is available to your business.
  4. Next you need to let people know you’re hiring. Your training organisation will advertise the position for you through the find an apprenticeship service. But you should supplement this with your own promotional efforts.
  5. Finally, choose your apprentice and set up an apprenticeship agreement and commitment statement with them.

Find out more about employing an apprentice.

 

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Paul JohnsonGroup Financial Director

Paul Johnson is very much a home-grown talent.

He joined Great Annual Savings Group in its infancy, fresh from a youth career as a professional footballer with Hartlepool United.  He quickly established a reputation within the business and aced all required accountancy qualifications in the space of four years to become the Group’s Management Accountant.

Several successful projects later, Paul was promoted to Head of Finance.  When the former FD left GAS, he took on the mantle of the business’ most senior finance professional; boasting a string of incredible achievements all under the age of 30.

Quote:

“I have witnessed phenomenal growth at the Group over the many years I’ve worked here and I’m looking forward to guiding the Group into an exciting new chapter.”

Interesting fact:

Paul made his professional debut for Hartlepool United against Bournemouth in the Football League.  Some say Danny Ings still resides in his pocket to this day.