CIPD: Quarter of people ‘would pay more’ to firms that employ apprentices Businesses could attract more customers and boost profits by including apprenticeships in their employment strategy, a new report has found.The study, The Benefits of Apprenticeships to Businesses, by the Centre for Economics and Business Research (CEBR) revealed that consumers prefer to do business with companies employing apprentices.
Launched to mark the start of National Apprenticeship Week 2015, the study found two-thirds of consumers view companies offering apprenticeships as contributing to society, with five million more likely to make a purchase from an apprentice employer.
One-in-four consumers said they would pay more for goods and services from companies employing apprentices, with plumbing, hairdressing and eating out the services they were most willing to pay a premium for.
Those surveyed said they were prepared to pay between 1.2 and 2 per cent more as a price premium. Aggregated across key sectors in the economy, this could equate to an additional £18 billion a year in consumer spending, the report said.
The survey found that, once trained, a typical apprentice delivers productivity gains of more than £10,000 per annum, rising to almost double that in the construction and planning, and engineering and manufacturing sectors. The figures show that whilst training, each apprentice in England is estimated to deliver an average positive net gain of £1,670 per annum to their employer.
The CEBR found potential weekly gains varied according to different sectors, averaging at £214 per week. In the retail sector the gains were found to be £83 per week, as much as £114 in health, public services and care, up to £401 in construction and planning, and £414 per week in engineering and manufacturing.
Scott Corfe, co-author of the report, said: “This report proves hiring apprentices has a hugely positive impact on employers. Not only do apprentices contribute to the productivity of a company from day one, but consumers are more likely to switch to brands and firms that employ apprentices.”
Steve Starling, HR and training manager, from Suffolk-based JEB Engineering Design, said: “We’ve been recruiting apprentices for over 35 years. Many staff members in senior positions here started out as apprentices, including our managing director. We believe our future success is dependent on a strong, sustainable apprenticeship programme.”
The CIPD’s findings tally with this latest report. In Apprenticeships that work – a guide for employers,the CIPD found that 96 per cent of employers which take on an apprentice report benefits to their business.
It also found that 75 per cent of apprentice employers said their apprenticeship programme had helped cut recruitment costs, while 80 per cent said apprenticeships would play a greater role in their future recruitment policy.
Annie Peate, policy and campaign officer for the CIPD’s Learning to Work Programme, said. “If you are bringing in apprentices you are really thinking about your longer-term talent planning strategy. It sends out a strong message about how the organisation values their community and their employees.”
Peate added that businesses should be aware that their immediate return on investment would not be significant. “However, it is an investment which pays dividends,” she said. “If you have a longer-term approach you are going to have more interested, more switched-on, more productive employees and you are also going to have them for longer because this impacts on retention rates.”