SME business boost from Apprenticeship Levy

Small businesses can take advantage of the Apprenticeship levy to increase business productivity!

The Apprenticeship Levy is a UK tax on large employers which can be used to fund apprenticeship training.  However, smaller businesses in England (defined as those with an annual pay bill of £3 million or less) do not have to pay the government’s apprenticeship levy but can still access funding of up to 95% towards the cost of apprenticeship training.

Why the need?

Supporting the development and growth of smaller businesses has never been so important. At the start of 2020 there were 5.94 million small businesses (with 0 to 49 employees) and Small to Medium Enterprises (SMEs) account for three fifths of the employment and around half of turnover in the UK private sector. According to the Federation of Small Businesses (FSB) they say that ‘ensuring small employers are able to recruit and retain a skilled workforce is critical to unlocking enhanced productivity and growth in small businesses.’

Why Apprenticeship training?

Around a quarter of small businesses already employ apprentices and a further 24 per cent would consider taking them on in the future.  Research from the National Apprenticeship Service claims 90 per cent of employers feel apprenticeships provide a constant flow of suitably trained staff.

Simply put, apprenticeships are different now to what they used to be! The apprenticeships standards on offer for given sectors have been created by employers in that particular sector. They aim to focus on the quality of the apprenticeship by asking employer groups themselves to define the standards of what would make an apprentice valuable to them.  The term ‘trailblazers’ has been used to describe these employer groups in recent years, and our very own Managing Director, Paul Stone, chaired the degree apprenticeship trailblazer group in the supply chain sector.

How does a small business benefit?

It is an opportunity to showcase your business to attract the best talent.

The scheme enables you to either take on a new apprentice or helps you develop existing employees.  A well thought-out-and-planned apprenticeship training strategy showcases how your business invests in employees and progresses their careers.

It also builds employee loyalty. When new or existing employees are trained in the business’s unique style, they feel a sense of loyalty with the company that gave them their start, which increases the chances of retention.

Relevant business-led quality training for every level of employee.

Businesses can now choose various apprenticeships from entry-level to more advanced degree apprenticeships enabling you to develop an employee with the exact attributes that fit your organisational needs and culture.

For college leavers, degree apprenticeships are a great alternative to attending traditional university programmes. They combine paid work alongside university study, enabling apprentices to gain practical skills whilst obtaining a degree at the end of the programme.  For existing employees, they fill the gaps in their knowledge and enable them to learn the latest ‘best practices’ as well as gaining a qualification.

One of our small business clients, TensCare Ltd, is Europe’s largest distributor of pain relief machines. They do not pay the apprenticeship levy but have chosen to train their Supply Chain Manager, Movina Dias, through our Supply chain degree apprenticeship.

She comments; “This is the first-degree apprenticeship that TensCare have used to develop staff members.  Both the Supply Chain Academy and Leeds Trinity University have been great to work with. They made the application, enrolment and induction processes easy. The workshops have been insightful as we’ve learned practical tips on improving the way we move our products.  I’m really enjoying the degree and the business has benefited hugely.”

Additional funding available

In addition to the access of up to 95% towards the cost of apprenticeship training, as part of the government’s plan to kickstart economic recovery, all employers are being given an additional incentive of £2,000 if they hire an apprentice aged 16-24 and £1,500 for new apprentices aged above 25 between 1 August 2020 and 31 March 2021.

About us

We specialise in developing supply chain professionals through our supply chain career pathway framework which develops apprentices from Level 3 (equivalent to an ‘A’ Level) to Level 6 (degree).

Since 2018, we have been delivering a unique supply chain degree apprenticeship in partnership with Leeds Trinity University. The programme has grown to nearly 200 ‘professionals’ of all experience on programme.

For more information about our apprenticeships contact Alex Mortimer on am@supplychainacademy.org.uk or 01708 259 450.