How to Pay for an Apprentice

Cash Fund to get an Apprentice is Extended

For those who missed the announcement after the New Year break, a cash payment of £1,500 to get an apprentice is extended to the end of 2013.

This quick guide will explain how to benefit from an apprentice. By the end of the page you will appreciate where they save time, and then make you money.

How to Pay for an Apprentice

All you need to do is earn more each month than the apprentice costs you.

Currently these are the principles of apprenticeships:

  • they are your employees*, drawing a regular wage
  • you commit to improving their skills on the job
  • they undergo some formal training, for example at a college, usually at your cost
  • your business gets more work done, so in time the apprentice should earn you more than they cost

Whilst skilled employees and subcontractors need briefing on the task and expected standards, apprentices also need some demonstration or instruction. The key is to build up a mixture of simple tasks that save money by supporting skilled workers, and others where the apprentice takes time to learn but soon becomes competent.

Consider the straightforward jobs that hoover up skilled workers’ time, and resist the desire to get your money back every single day!

* Some schemes do the employment administration, but you still commit to providing work and experience for a regular fee.

Myths about Apprentices

  1. They cost money. True – you have to pay the wages and training costs. But, like any other employee, they will only cost you money overall if you don’t make good use of their skills
  2. They leave when they are trained. Again, like any employee, your apprentice will be loyal to you if you are worth staying with. Employees don’t leave when they are happy and valued
  3. They are a liability and slow the work down. For the first few days, possibly. As with any person you employ or subcontract, you should line up tasks which are within their skills. Training someone takes time initially but soon they become more independent. Frankly, if you can’t delegate you do not yet have the skill to grow your business, but you can learn to gain from an apprentice
  4. Apprentices are slave labour. True – if you only give them basic tasks in order to be ‘useful’ from day 1. But you will be saving a few pounds per day rather than profiting from a skilled employee. And of course myth 2 will kick in – why should they stay with you?

What now?

You grow a business by getting more income, not saving costs.

Firstly decide what manpower you need (whatever the skill level) to help you do more business.

Secondly, calculate what type of manpower will work best for you (e.g. recruiting, sub-contracting, apprenticeship).

Contact me to discuss expansion and assess your options. My job is to help you make business decisions, not sell you an apprentice.