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Monday, 21 September 2015

Member Blog: Apprenticeship Grants – are they worth it? The fall and rise of the apprenticeship

By David Wright - BSA Marketing

Apprenticeships have been around for hundreds of years then, all of a sudden, in the 1990s everyone was off to college – the brave new world of university for all.

RIP apprenticeships?

Now, after less than 20 years, apprenticeships are back with a vengeance. Bright 16-19 year olds with more than adequate results for a place at University are voting with their feet and choosing an alternative; to go into work-based higher education through an apprenticeship.

OK, pay rates are modest but apprentices have the opportunity to build valuable (and genuinely employable) real-world skills that will see their earning potential rise without finding themselves, in their early twenties, encumbered with a £30000+ loan.

There will always be young people for whom university is the right choice but I believe apprenticeships offer a real and valuable alternative to many people joining (or re-joining) the world of work.

But what about businesses? The government is currently offering apprenticeship grants of £1500 (rising to £3000 in some areas) to a business that takes on an apprentice. Is the grant worth it?
What is the employers’ role in making an apprenticeship work?

Why should I offer an apprenticeship?

When I talk to many SME business owners about apprenticeships, there are two distinct camps:

1. Apprenticeships are a cost to my business

Taking on an apprentice will distract from my business while I give up time to train them. Even with a government grant contribution, apprentice wages are higher than the contribution they make to my business.

2. Apprenticeships are an investment in the future of my business

My business relies on a skilled workforce. Investment in our apprentice programme is a key element of our strategy to deliver the skills we need to sustain our business and achieve our development plans.

Interestingly, most people in Camp 1 have never taken on an apprentice while those in Camp 2 have real-world experience! Camp 2 companies do recognise that there are costs and that not every apprenticeship works out but by taking a planned, strategic view they appreciate that the investment delivers real value over time.

Should businesses be paid apprenticeship grants?

The apprenticeship grants can be seen in two ways

An Incentive…

…to ease the pain of the cost of an apprentice to your business

A Contribution…

…to the investment in building a skilled workforce for the future

Which way you see it is subjective but maybe the incentive view is ‘glass half-empty‘. No matter what the incentive, apprenticeships are a bit of a pain! Is this approach set to deliver a positive outcome for anyone? I think not.

On the other hand, the contribution view is ‘glass half-full‘. Our planned apprenticeship programme delivers real benefit to our business and the contribution is a welcome addition. We are focused on making things work.

So whether the apprentice grant is worth it or not depends more on planning and attitude rather than cash?

I believe apprenticeships are here to stay and are immensely valuable as an option in the education and growth of young people (and increasingly older people too).

However, for an apprenticeship to work, to really deliver value to both the apprentice and the employer, the company needs to have a strategic vision for apprenticeships as part of their business growth.

Strategic investment in an apprenticeship can be a real win:win

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