There is not time like the present to take on an apprentice. Apprentices are often understated in the working world, considering how much they can do for a business. Sure, apprentices often require a little training to get started but who doesn’t? Often apprentices are eager to work and will do all tasks to the top of their ability as they are keen to impress in the hope that it will spring board them into a better future. Not only that but when their apprenticeship comes to an end you may find yourself wanting to take them on as a full time employee that already know all the ins and outs of the business.
Recent Government changes to apprenticeship funding means that it costs even less to take on an apprentice. The apprenticeship levy, which was introduced in April 2017, is a tax on Business’s pay bills of 0.5%. This tax comes with a £15,000 offset against their levy payments so any Business with a pay bill under £3M will not have to pay anything. Levy paying employers will get an apprenticeship service account that they will be able to access. The amount of funds that go into this account will be calculated as follows:
- Total monthly levy paid to HMRC
- Multiplied by the proportion of the employer’s pay bill that goes to their workforce living in England
- Plus a 10% top up on this amount monthly
Employers will be able to use this money to pay for apprenticeship training and assessment for apprentices that work at least 50% of the time in England and only up to the funding band maximum for that apprenticeship. There are fifteen funding bands ranging from £1,500 to £27,000 and you can use this useful excel sheet to search for specific apprenticeships and what funding band they fit in to. To view the full apprenticeship funding report click here: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/562401/Apprenticeship_funding_from_May_2017.pdf
The UK is currently facing a major skills shortage and Brexit is likely only going to make things worse. This means that we need more skilled people to fill up these roles. Apprenticeships are the way to go. While investing in education may create a brighter workforce this is unfortunately not what is needed. Students finish University and College with some exam results but no idea how to do the jobs that they think they want and have been studying for. Experience is key and apprenticeships allow businesses to give people the experience they need to get in to these higher skilled jobs without having to foot the entire bill.
Apprenticeships are also a huge economy boost. For every £1 that is spent on apprenticeships the economy gains £21. When you compare this to other forms of investment such as innovation and research and technology sectors which range from £4-£7 per £1 spent, you can see that apprenticeships funding is incredible valuable for the economy. The benefits from apprenticeships are huge! They will help to fill the skills shortage and at the same time greatly boost the economy, what is not to like.