How apprenticeships can boost your business

How apprenticeships can boost your business

Apprenticeships offer a great opportunity for individuals to gain lifelong skills, but the benefits for businesses can be overlooked.

In the spirit of National Apprenticeship Week, we’re sharing how taking on an apprentice can support your business goals.

Improved staff retention

Did you know that 80 per cent of employers have a higher retention rate from offering apprenticeships?

According to St Martin’s Group’s findings, offering apprenticeships can boost staff loyalty, with 92 per cent of employers also seeing an increase in motivation.

Low retention rates are a common obstacle that businesses have to face. So, the fact that apprenticeships can improve loyalty and enhance efficiency makes them a good solution to this barrier to growth.

A diverse workforce

Further education isn’t for everyone and some people don’t thrive in an academic environment. But it’s essential to remember that this isn’t an indicator of intelligence or ability to work within your sector.  

By providing an alternative route to employment, you can build a team that reflects the qualities that are important to you and will support your business goals.

You’ll also be creating a team with a diverse range of experiences, ideas and viewpoints, which are crucial for well-rounded decision-making.

Economical training

To reflect the investment of time and resources to train apprentices, the National Minimum Wage for apprentices is lower than other workers.

The National Minimum Wage for apprentices is currently set at £5.28 per hour but will rise to £6.40 per hour from April 2024.

With 77 per cent of first-year apprentices being aged 19 or over, they would need to be paid at least £8.60 per hour from April 2024 if they were in regular employment. For individuals aged 21 and over, they would be paid £11.44 from April.

By offering the opportunity for high-quality training alongside this wage, you can upskill the trainee and have lower labour costs – making the apprenticeship beneficial for both you and the trainee.

However, you must take into account that you can offer more than the apprentice rate, and in a competitive market, you should consider doing so.

Building life-long skills

If you operate in a specialist sector, such as agriculture or engineering, it can be challenging to find recruits with the required skills for your business.

Offering an apprenticeship scheme means you can fill the skills gap, and train apprentices with the know-how of how to succeed in your industry.

Again, this is a more cost-effective method for training a team that can further your business and help you achieve your goals.

Considering taking on an apprentice?

If you are considering taking on an apprentice, you may be eligible for financial support from the Government apprentice funding.

This is designed to support the cost of training and assessment and training.

The Government also supports businesses with apprentices through the Apprenticeship Levy.

If your annual wage bill is less than this £3 million, you will not pay the levy. All businesses with a wage bill over this threshold are required to pay this.

If you are not required to pay the levy, you will only be required to pay five per cent of the cost of training and the Government will pay the remainder, up to the maximum funding amount allocated to that particular band.  

You must understand what funding is available to you and how this would impact your business before training an apprentice on.

Contact us for advice on managing your business’s finances to support your apprenticeship scheme.