The business case for offering Apprenticeships

What are the facts?

Research continues to show the benefits of hiring apprentices. Recent surveys of employers who had Apprenticeship schemes found that:

• 92% of employers said that their Apprenticeship programme better motivated staff and increased job satisfaction 1  
• 82% said that they took on an apprentice to build the skills capacity in their organisation 2
• 81% said that employing apprentices generated higher overall productivity for their company 3
• 74% said that apprentices tended to be more loyal, remaining at their company longer than non-apprentices 4
• 66% said that their Apprenticeship programme made them more competitive in their industry 5

Do apprenticeships make good business sense?

Apprenticeships make good business sense. Skills shortages are still one of the biggest threats to UK business. Apprenticeships can help businesses across all industries by offering a route to harness fresh talent. By training people with the right skills for the job they can do a wider range of tasks and take on new responsibilities; this can help to reduce skill shortages, minimise staff turnover and workplace accidents and increase productivity.

Is taking on an apprentice cost-effective?

Taking on an apprentice is cost-effective because people can learn while they’re on the job and the government contributes to the costs of learning. There are clear financial benefits to employers and their investment in Apprenticeships is repaid many times over.

How quickly are costs recouped?

"investment is recouped [...] within two to three years"

A recent study by the University of Warwick Institute of Employment Research found that the costs of Apprenticeship training are recouped relatively quickly – in some cases within a year – and that where the investment is nurtured the returns are significant. The report found that "the evidence points to employers obtaining a range of qualitative benefits from the Apprenticeship training in which they invest, but importantly that investment is recouped in monetary terms within two to three years in most instances". 6

What are the long-term financial benefits?

Another study by Sheffield University measured the long-term financial benefit to investing in Apprenticeships. A Level 3 Advanced apprentice will generate an additional lifetime benefit to themselves and their employer of £105,000 compared to someone who does not gain an Apprenticeship. The Level 2 additional benefit is £73,000. This represents a gain of £16 for every £1 of taxpayers' money. 7

• 1Ibid
• 2British Chamber of Commerce, Skills for Business: More to learn? (October 2011)
• 3Learning and Skills Council, The Benefits of Completing an Apprenticeship (April 2009).
• 4Ibid
• 5Ibid
• 6 Learning and Skills Council, Net Benefit to Employer Investment in Apprenticeship Training, Warwick IER (November 2008).
• 7A Cost-Benefit Analysis of Apprenticeships and Other Vocational Qualifications, University of Sheffield, 2007