Many businesses are waking up to the benefits of apprenticeship schemes. Over 30,000 pledges were received during National Apprenticeship Week earlier in the year, from businesses across the country agreeing to create apprenticeship and trainee roles within the next twelve months.
Numerous industry surveys have shown that apprenticeships are proven, cost effective means of bringing fresh talent into a sector. In our own industry, telecoms, we believe that apprenticeships are the key to bridging the widening skills gap and are crucial for its future. So why is there still a perception that apprenticeships are not suitable for small businesses? Why should businesses take on apprentices; and are there barriers that small businesses need to be aware of?
Build a workforce from scratch
Hiring an apprentice is a long-term investment, and many of our members see it as an ideal opportunity to create a workforce trained from scratch. Employee’s work habits can be shaped from the start, and aligned with company culture. Research from the National Apprenticeship Service also shows that 90% of employers feel apprenticeships are a great way of ensuring a constant flow of suitably trained staff. What’s more, the same survey revealed that 90% of employers see apprenticeships as their way of ‘giving something back’ and therefore addressing CSR targets.
Whether a large corporate or small business, a highly trained workforce is essential. The benefits of apprenticeship schemes is that most come with associated qualifications, so employees are learning on the job.
At the ITP, we run our own apprenticeship scheme recruiting, training and mentoring on behalf of our members. Steve Hayden, MD of Green Telecom, started his career as an apprentice and was one of the first members to use our scheme. He echoes the benefits: “An apprentice who is willing to learn should potentially have a long term fulfilling career and will be an asset to a small business. An apprentice will have fresh ideas to bring to the table and can be trained to fit in with the company.”
Back in 2013 we identified the need for a telecoms specific apprenticeship scheme. Having researched the idea with our members we found that 100% would, in an ideal world, employ apprentices if they could. We also discovered however, that the biggest barriers to taking on apprentices with small and medium-sized enterprises (SMEs) in our industry included the administration required, time constraints, staff resources and access to training. In fact, at that time, it was only the larger organisations in a position to employ apprentices.
Arguably the biggest barrier to recruiting apprentices is cost, particularly for SMEs who fear the financial implications of such a commitment. However, the Government provides full funding for training a 16-19 year old, and 50% funding for a 19-23 year old provided they are on an approved programme. The National Apprenticeship Service will also provide up to 40,000 apprenticeship grants to small-medium (under 50) sized employers recruiting 16-23 year olds, with a value of £1,500 (for each apprentice).
It is currently now better value than ever for employers to take on young apprentices, with the Government recently announcing the abolition of employer national insurance contributions for apprentices under the age of 25. Whilst those perceived barriers first identified in our survey of 2013 still remain for some, they don’t have to. Our scheme, for example, takes care of the time-consuming elements for businesses who are keen to take on apprentices, but are not sure where to start.
The future of apprenticeships
The forthcoming Apprenticeship Levy, coming into effect in April 2017, will undoubtedly change the apprenticeship landscape. It will install a 0.5% tax on companies with a wage bill of more than £300m, but will affect SMEs too as companies with a lesser wage bill will be able to draw from the fund. The response to the levy has been mixed, some see it as way of increasing the quality of placements across the country whilst others argue it could force businesses to look at quantity rather than quality. Our advice would be to get ahead of the game and start employing apprentices now and to engage with your payroll software provider now to ascertain how the money will be taken and avoid any potential hiccups.
Ultimately, apprenticeships are vital to the development of any industry. Not only do they bring fresh talent, but greater staff retention and more tailored skills.
By Crissi Williams, Institute of Telecommunications Professionals (ITP)