Employers willing to pay more for good apprentices

A study has shown that 92 per cent of employers are willing to pay more than the typical apprenticeship wage, provided they’re matched with the right apprentices.

The research, carried out by Positive Outcomes, questioned 100 UK employers over their attitudes towards apprentices in the run-up to the GCSE and A-Level results days.

As part of the study, employers were asked, ‘Are you prepared to offer more money than the standard apprenticeship wage for the right apprentice?’ to which 92 per cent said ‘yes’, with only 8 per cent responding ‘no’.

Ryan Longmate, managing director of Positive Outcomes says, ‘The combined research findings have certainly thrown up an interesting suggestion. That, despite young people thinking otherwise, employers are open-minded when it comes to pay and that, should the right candidate come along, they’re willing to pay more than the standard wage.’

The study also questions employers about the wages they are likely to pay should they offer a full-time position to a former apprentice who had completed an apprenticeship scheme with them.

A quarter (25 per cent) state they would pay between £12,000 and £13,999, 24 per cent say they would pay between £14,000 and £15,999, while 11 per cent report they would pay between £16,000 and £17,999.

When combined, those figures suggest that 60 per cent of post-apprenticeship employers would pay between £12,000 and £18,000 as a starting salary for an apprenticeship-qualified employee.

Longmate adds, ‘The minimum wage for 18-20 year olds per hour in the UK is £5.30. When taken as an annual salary, based on a 37.5 hour week, this equates to around £10,300 per year. Our research suggests then that the vast majority of employers are willing to pay considerably more than that for an apprenticeship-qualified employee.’

The value of good apprentices

Jeremy Stern, managing director of marketing company PromoVeritas, took on his first-ever apprentice 18 months ago and says it has been a great success.

‘Matt joined us straight from school and we enrolled him a course on project management one day a week,’ Stern says. The rest of the week he was in the office helping the company to deliver projects with tasks including from picking winners of prize draws, calling them to congratulate them on their win, buying the prizes or sorting out the paperwork and invoicing to clients.

‘He has proved to be a great learner, able to blend the experience from the office with the academic principles of his course.’

The achievements of the apprentice were recognised just last month when Matt won the title Apprentice of the Year in an Awards ceremony organised by the Federation of Small Businesses (FSB).

‘Matt has progressed in terms of salary and is now earning a good amount, and we are looking to take on a new apprentice in the autumn,’ Stern continues.

A culture of encouraging young people to build a career in engineering is prevalent at Massey Truck Engineering. Company secretary Simon Willis, says that some of the company’s senior managers originally joined the business as apprentices.

The company used Skills Made Easy, which provides a range of training and apprenticeship advice, to help with access to suitable candidates as well as working with them to develop a hybrid apprenticeship programme, tailored specifically to suit the needs of our business.

One of the apprentices hired by Massey was 19-year-old Joe White, who started his apprenticeship in January. White says, ‘I decided to apply for the apprenticeship and saw it as a way of bettering myself and building a career. I was fortunate enough to be given a chance and it was a real eye-opener for me; I had no idea how much work was involved in building a truck!’

White adds, ‘During my apprenticeship, I’ve been learning about health and safety as well as developing my engineering skills. I’ve not got much longer left on my apprenticeship and so I’m also able to help [fellow apprentice] Elliot learn how to do the job. It’s hard work, challenging at times, but very rewarding.’

Related: Small business apprenticeships – How companies can make the most of new opportunities

Apprenticeship levy will ‘undermine quality of apprenticeships’

The apprenticeship levy is not fit for purpose and the government should not be pressing ahead with it, a leading HR body says.

Ben Willmott, head of public policy at the Chartered Institute of Personnel and Development (CIPD) says the concerns regarding the levy in its current form are widespread across organisations from the private, public and voluntary sectors, and it is irresponsible for the government, particularly in a time of economic uncertainty in the aftermath of the referendum, to simply press ahead with a policy that is not fit for purpose.

The apprenticeship levy is set to go ahead as planned in April 2017.

‘Our research suggests the levy, in its present form, will undermine efforts to improve the quality of apprenticeships,’ Willmott adds. ‘This is a time where we need to be raising the status of apprenticeships, not pursuing a policy which will have the effect of devaluing the ‘apprenticeship brand’.’

‘There are the damaging unintended consequences of forcing employers to reduce investment in other areas of equally valuable workforce training and development, and to essentially ‘re-badge’ existing training as apprenticeships in many instances.’

This ‘one-size-fits-all’ approach will damage attempts to improve the UK’s workplace productivity and will not address the downward trend in employer investment in training in recent years, according to Willmott.

Apprenticeship findings

According to CIPD research, six in every ten apprenticeships created in the UK are only at Level 2, equivalent to just five GCSE passes. In addition, the percentage of apprenticeship starts for people aged under 25 has dropped significantly from 99.8 per cent of all apprenticeships to 57 per cent in the last decade, while just one fifth of starts at Level 3 were reserved for 16-24 year olds in 2014-15.

The CIPD’s report shows that while the number of under-25-year olds starting an apprenticeship has increased by 24 per cent since 2010, the number of over-25s increased by 336 per cent. The number of over-60s grew by 753 per cent, from just 400 in 2009–10, to 3,410 in 2014–15.

Sharon Walpole, CEO of www.notgoingtouni.co.uk, says that while the new levy does have its downsides, it’s great to see that businesses with annual wage bills below £3 million will have 90 per cent of their apprenticeship fees covered by the government, meaning they only have to find 10 per cent from the business.

‘Take into consideration that those aged 16-18 years old would also provide a £2,000 incentive, split between the business and the individual, and there are some real incentives here for businesses to look at beginning apprenticeship programmes, or extending the programmes that they already have in place,’ she adds.

Ben Lobel

Ben Lobel

Ben Lobel was the editor of SmallBusiness.co.uk from 2010 to 2018. He specialises in writing for start-up and scale-up companies in the areas of finance, marketing and HR.