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Mid-market business turns to apprenticeships

Next week (5 to 9 February) is National Apprenticeship Week.

As attrition rates remain stubbornly high, mid-market businesses plan to increase the use of apprenticeships to train and upskill workers, according to research from professional services firm Grant Thornton.

Nearly two thirds (60%) of 602 mid-market business leaders said that more of their employees would be trained using apprenticeships in 2024 than in 2023, with 57% planning to use apprenticeships to fill skills gaps in data and digital.  

The top priorities for skills development investment were digital (80%), financial (79%) and leadership (79%). 

Justin Rix, head of talent solutions at Grant Thornton, said: “We’re seeing clients make increasing use of apprenticeships as a strategic tool for developing skills that their organisation needs across all levels.

“The added benefit is that apprenticeships can be tailored to specific business requirements and provide individuals with the opportunity to gain valuable qualifications and future proof skills.”

Read more: Apprenticeships have plummeted since levy introduced

Over half (58%) of respondents say they are still experiencing unusually high attrition rates, down slightly from 61% last year.  

The majority also said that they are struggling to recruit, both to replace leavers (54%) and for growth (55%).

Nearly two thirds of employers (63%) said that they are offering higher salaries to entice new recruits, whereas 66% are offering pay increases and bonuses to reward and retain talent

Paul Devoy, chief executive of workplace accreditor Investors in People, said that businesses have responded to the tighter labour market by developing their own talent.

He told HR magazine: “Employers are used to having a very flexible labour market where they can recruit labour cheaply, but the labour market tightened considerably, and as a result of that employers are taking a longer-term view. They are recognising they need to make a long-term investment in skills and grow their own talent.

“Learning and earning is an attractive proposition, so there’s definitely a demand from young people and parents seeing the value in the apprenticeships. This means apprenticeships can be a real recruitment draw.”

Rix added that apprenticeships are a cost-efficient option for businesses when the apprenticeship levy is used. 

He said: “For employers with a pay bill over £3 million, who are already paying the apprenticeship levy, the apprenticeship route can also be very cost-effective, as levy contributions can be put towards the cost of training.”