In today’s fast-paced business world, continuous learning and employee development are essential to staying ahead of the competition. Training programmes ensure employees have the right skills and that they remain up-to-date. Strategically, this helps businesses grow and also improves employee engagement by facilitating career progression.
Many firms are now taking advantage of apprenticeships to combine practical on-the-job training with theoretical learning. In the 2021/22 academic year, 740,400 people participated in apprenticeships in England, with 349,200 started and 137,200 achieved.
Apprenticeships can offer an innovative way for organisations to develop, train, mentor their employees and bolster their recruitment and retention rates. A 2022 report from the Department of Education found that 62% of apprentices stayed working for the company that trained them after completing their apprenticeship and 76% of employers said that training existing employees as apprentices improved staff retention.
A core benefit of apprenticeships is that they can be used for all levels of employees, from entry-level roles through to degree-level apprenticeships. Apprenticeships in England benefit both the apprentice, who gains invaluable skills and experience and the employer, who cultivates a talented and skilled workforce from within.
For those not already using apprenticeships, they can seem complex, especially for smaller firms who are not paying the Apprenticeship Levy and may be unaware of the benefits. However, it’s important to note that apprenticeship opportunities are available for all businesses, irrespective of size and are an increasingly valuable way to recruit and upskill the workforce.
How the Apprenticeship Levy works
For employers in England, the Apprenticeship Levy has transformed the apprenticeship landscape. Launched in 2017, the levy requires employers with a pay bill of more than £3 million yearly to invest 0.5% of their payroll into the levy. If firms pay the levy, they will receive funds to spend on training and assessing their apprentices, and the government will add 10%.
Whilst many SMEs are under the impression that they cannot access Apprenticeship levy funds, it is, in fact, the case that businesses who do not need to pay the levy will pay 5% towards the cost of training and assessing an apprentice. The Government will pay the balance (95%) up to the funding band maximum. This is known as ‘co-investment’.
Employers who do not pay the apprenticeship levy can reserve funds up to three months in advance of the expected apprenticeship start date. Also, as of April 2023, small employers who didn’t pay the levy will no longer be limited to a maximum of 10 new apprenticeship starts – they will be able to recruit as many high-quality apprentices as their business needs.
Employers may also be eligible for additional funding and support depending on their apprentice’s circumstances or if they are a small employer employing fewer than 50 employees.
Tapping into the Levy to boost coaching and mentoring skills
Levy-paying employers are often not using these funds in the most effective way. Research from City & Guilds and the 5% Club found that employers have spent an average of 55.5% of their apprenticeship levy funding in the last five years highlighting that nearly half of the generated funding has not been used by Levy paying employers and risks going to waste.
One option that can offer tangible long-term benefits is to upskill the workforce in areas such as coaching and mentoring using apprenticeships. This means employers can use their levy funds to invest in training that has the potential to bring about transformational change.
Coaching and mentoring, in particular, are essential skills in today’s collaborative business environment. They enable individuals to guide and support their colleagues and foster a culture of continuous learning, mutual respect, and holistic growth.
By equipping the workforce with coaching and mentoring skills, businesses are not only ensuring they can perform their current roles more effectively but they are prepared for leadership positions in the future.
In an age where continuous learning is the key to success, apprenticeships offer a golden opportunity for employers to invest in their most valuable asset—their workforce. It’s a win-win for both individual career progression and organisational growth.
The OCM offers two coaching and mentoring apprenticeships.
