Hiring an apprentice can be one of the smartest investments a business makes, but it’s often misunderstood.
Many business owners assume apprenticeships are costly or complicated, but they are often a cost-effective way to build skills, develop talent, and future-proof your workforce.
To help clarify, let’s break down what employing an apprentice really involves, from costs to practical tips, so you can make an informed decision.
First, let’s look at costs: what does it cost to employ an apprentice?
The good news is that for most businesses, training costs are heavily subsidised or even fully funded.
Training Costs (Government Support)
If your business does NOT pay the Apprenticeship Levy
You typically pay just 5% of training costs.
The government pays the remaining 95% (Read more here GOV.UK)
In some cases (e.g. younger apprentices), training may be fully funded.
For example, a £10,000 training programme could cost your business as little as £500
If You DO Pay the Apprenticeship Levy
This levy applies to businesses with a payroll over £3 million.
You contribute 0.5% of your wage bill into a levy fund (GOV.UK)
The government adds a 10% top-up to your funds (Everything Apprenticeships)
These funds are then used to pay for apprenticeship training (often 100% covered)
Wages
You must pay your apprentice a salary:
Apprentices are entitled to at least the apprenticeship minimum wage.
After year one (or age 19+), they move to standard minimum wage rates.
Government funding does NOT cover wages, only training.
Beyond wages and training contributions, your main investment is time—mentoring, supervision, and allowing for reduced productivity during training. Also consider equipment, software, or uniforms they may need.
Grants & Incentives
You may also be eligible for:
£1,000 government incentive for hiring younger apprentices (GOV.UK)
Potential levy transfers from larger organisations
National Insurance savings in some cases
Now that we’ve covered costs, why should your business consider hiring an apprentice?
Apprenticeships aren’t just about saving money; they’re about building your future workforce.
Businesses report benefits such as improved staff retention and loyalty. Plus fresh skills and new perspectives in your business. In fact, many employers say apprenticeships directly improve workforce skills and long-term growth.
Top tips for employing an Apprentice successfully
1. Choose the right role - Apprenticeships work best in roles where skills develop over time, such as admin, finance, marketing, HR, trades, and more.
2. Assign a strong mentor - This is critical because your apprentice will need guidance, regular feedback and structure. A supportive mentor can make or break the experience.
3. Set clear expectations from the start - It is important to define working hours, training commitments and performance expectations. Clarity builds confidence for both sides and will avoid issues later.
4. Think long-term - An apprentice isn’t a quick fix. They are a future team member and a long-term investment. Businesses that succeed with apprenticeships plan beyond the first year.
5. Work with the right training provider - A good provider will handle administrative and compliance matters. They will support both you and the apprentice and ensure training aligns with your business needs.
Is an apprentice right for your business?
Having considered costs, incentives, and practical guidance, is hiring an apprentice right for your business?
If you have time to support someone and want to invest in long-term growth, apprenticeships are an ideal, low-risk way to build talent.
Employing an apprentice isn’t just about filling a role, it’s about shaping the future of your business.
With government funding covering most training costs and flexible options available, there’s never been a better time to consider it. Invest the time and reap lasting rewards.
If you need advice and support get in touch with Plain Talking HR
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