A start-up owner’s guide to apprenticeships

Hiring staff is often crucial to launching or scaling a new business. However, recent British Chamber of Commerce figures reveal that 79% of firms have reported difficulties hiring employees.

Competitive wages, skills gap and the move to remote and hybrid working are some of the main reasons businesses struggle to recruit staff.

Hiring an apprentice can be a cost-effective way to grow your business by training a person on the job while helping develop their skills and experience.

According to government data, smaller businesses account for 41% of apprenticeship starts in 2020/21, increasing from previous years.

What is an apprenticeship?

An apprenticeship is paid employment that combines on-the-job training with studies, with the apprentice working towards a work-based qualification.

An apprentice should spend at least 20% of their working hours in off-the-job learning with a university, college, or recognised training provider.

It can take one to four years to complete an apprenticeship and gain a nationally recognised qualification.

An apprenticeship is suitable for anyone over 16 years old, whether fresh out from formal education or at any skill level, such as:

• looking for a career change
• needing to upskill in their current role and job
• early in their career.

Benefits of hiring an apprentice

Apprenticeships can offer many benefits to businesses.

According to apprenticeships.gov.uk, 78% of employers said apprenticeships helped them improve productivity, and 74% said they helped improve the quality of their product or service.

Employing an apprentice can help expand and upskill your workforce, and you can adapt their training according to business needs.

Apprenticeship costs

You must provide your apprentice with a contract of employment and pay at least the minimum wage, which varies depending on their age and year of their apprenticeship.

You will also have to provide benefits and pay that other employees in a similar role receive, including paid holiday and sick pay.

Funding support for employers

Government funding is available for the running costs of an apprenticeship for companies in England.

Scotland, Wales and Northern Ireland also have schemes that help with apprenticeships.

The amount of funding you can get depends on whether you pay the apprenticeship levy, which applies if your annual pay bill is more than £3 million.

Start-ups and smaller companies who don’t pay the levy will instead need to pay 5% of the cost of training and assessing the apprentice and agree on a payment schedule with the training provider, paying them directly for the training.

The government will pay the 95% remaining up to the funding band maximum directly to the training provider.

Further information can be found on the GOV.UK site.

How to hire an apprentice

These are the l steps you could take to prepare and hire an apprentice.

1. Identify your business’s skills gap

Take a look at your business and consider where you could use extra help from someone trained for the job.

2. Register for an Apprenticeship Service Account

An Apprenticeship Service Account will help manage your apprenticeships all in one place.

You can use the account to set up an apprenticeship and help find a training provider and funding.

More information is available at apprenticeships.gov.uk.

3. Choose an apprenticeship standard

Decide the role of the apprentice and look at available training options.

There are more than 700 apprenticeship standards to choose from across a wide range of industries.

The government’s online system can help you search for apprenticeship standards.

4. Find a training provider

Once you’ve chosen a course, you need to find a training organisation to deliver it.

You can use the government system or your Apprenticeship Service Account to find a training provider for your apprenticeship.

It may be a good idea to compare several and find the one most suited to your desired course and needs.

5. Advertise your apprenticeship

Once you’ve sorted out the details of the apprenticeship, it’s time to advertise and recruit a suitable candidate.

The job ad should specify the qualifications offered, what the role involves, and what type of candidate you’re looking for.

You can create the ad through your Apprenticeship Service Account.

The government offers guidance on creating apprenticeship adverts.

6. Interview and select your apprentice

Interviews should be similar to ones conducted for regular positions, but remember the applicant may not have a full CV or qualifications.

Use the interview to find an enthusiastic individual and ask why they want a career in that particular area.

Let other candidates know why they were unsuccessful in securing the apprenticeship, giving constructive feedback.

7. Sign an apprenticeship agreement

You must sign an apprenticeship agreement and commitment statement, giving details of the apprenticeship and outlining the training schedule and content.

The government has further advice and templates on what must be included in the two documents.

8. Select your End-Point Assessment Organisation

During the first three months of the apprenticeship, you will need to select an End-Point Assessment Organisation to conduct the assessment for the apprentice.

Their evaluation will identify whether your apprentice has gained the necessary skills and knowledge they set out to achieve.

9. Begin the apprenticeship

Providing all goes well, your new apprentice should be able to begin their apprenticeship with your business.

It’s worth considering how to ensure they get the proper support to encourage them to complete the training and delve into their career.

Read our guide on how to hire staff for your business.