Majority of smaller businesses realise the value of apprenticeships

Monday, March 5, 2018
Apprentices celebrating

Smaller businesses throughout England are embracing apprenticeships, with nine out of ten who have taken on apprentices saying they have boosted productivity, according to a new study by AAT. 

The study, commissioned to tie in with National Apprenticeship Week, shows that businesses appreciate the value apprenticeships can bring to them, with 97% saying that taking on apprentices has been good value for money for them, nine out of ten (90%) saying they have boosted their productivity, and 63% saying that they bring staff who are more suited to their businesses and the skills they need.

Growing number of apprentices taken on

The average number of apprentices taken on by these businesses in the past two years is three, with one in five (19%) saying they've taken on five or more. Seventy-eight per cent say that the number of apprentices they've taken on in the past five years has grown. In a signal of satisfaction, 96% of those questioned say that they are very likely or quite likely to take on more apprentices in the next two years.   

Fifty-five per cent of the respondents said that they prefer to recruit apprentices, compared to 32% who prefer university graduates. Fifty-seven per cent also said that apprenticeships are the best pathway into the industry in which their business primarily operates, versus 18% who said a university degree is the best. 

On average, the businesses who have taken on apprentices say they have offered to keep on 61% of them after they finished their apprenticeship, with one in five (21%) saying they have offered to keep on all the apprentices they have ever taken on. Four-fifths of the SME owners and senior workers (83%) say that apprentices have added value to their business within six months of taking them on.

How to find an apprentice

When looking to take on an apprentice:

  • 30% found out how to hire one from a government website
  • 24% found out from a registered training organisation
  • 19% found out from their local FE college or training provider
  • 19% got a word of mouth recommendation.

Fifty-seven per cent of those who take on apprentices said they take the initiative and contact their local FE college or training provider to help them find apprentices, 47% say they get contacted by them, but 13% say they don’t contact or get contacted by local colleges.

Forty-five per cent say they have already accessed available funds from the apprenticeship levy to help train a new employee, and 36% have done so to help train an existing employee. Twenty-one per cent have not accessed funds but intend to do so this year, 10% have not but are likely to do so over the next few years, 2% are unlikely to access funds, and 6% were totally unaware that funds from the levy were available for their business.

Of the businesses spoken to who have never taken on an apprentice, 39% feel there are still barriers holding them back from taking one on. Of those:

  • 29% say the cost of starting an apprenticeship scheme is the biggest barrier
  • 27% say trying to find out how to get funding is too complicated
  • 15% don’t know how to start a scheme.

Despite there still being perceived barriers for these businesses, 71% of those who have never taken on an apprentice say they are currently planning to take some on. 

Rob Alder, Head of Business Development at AAT says: "Although there have been some negative comments on the impact of the government’s apprenticeships reforms, our research shows that there are still many positives in training an apprentice and it is good to see that reflected in the SME market. Our research shows that England’s small businesses hugely endorse apprentices within their own firms and value the benefits apprentices can bring to them. Those who have taken on apprentices are happy with them, and even those who haven’t yet taken any on are making plans to do so.

"Businesses who have never taken on apprentices before, but who would like to, can access a large amount of help. AAT has produced a checklist which breaks the process down into seven easy steps, from creating your job specification, to finding the correct training provider. Information and advice from the government is also available online.

"It’s also worth checking whether there are any networks or chambers of commerce in your local area who might be able to give advice, and getting in contact with your local Further Education college or training provider, who could also be able to help." 

Sue Husband, Director of the National Apprenticeship Service, says: "We wholeheartedly believe that apprenticeships work – not just for apprentices themselves, but businesses of all shapes and sizes, across all industries, sectors and job roles, and for people of all ages.

"AAT’s research demonstrates the positive impact that apprenticeships have on small businesses in England. For people considering their first – or next – career, an apprenticeship can equip you with the skills and on-the-job training that you will require, while we hope other company owners will consider how taking on apprentices can boost their business."