“ Business leaders are increasingly recognising that apprentices are key to the future of this country and today's research highlights just how important apprentices are in aiding the UK's economic recovery ”
The report, 'The Economic Value of Apprenticeships', released ahead of Apprenticeship Week 2012, projects that employers across all sectors from Construction to Business Administration are set to profit from the additional apprenticeship starts. Employers offering engineering apprenticeships are set to be the biggest beneficiaries, with the sector predicted to receive a £267 million boost between 2012- 2020.
It is not just businesses that will benefit from the additional apprenticeship places.
An extra boost for the economy would also be generated through the increased tax revenues resulting from the extra apprenticeship starts. The report finds that income tax and national insurance contributions alone would generate an extra £1.2 billion for the UK economy between 2012 -2020 - a much needed boost at a time of harsh government cuts.
Chris Jones, CEO and Director General, City & Guilds said: "Our report findings clearly show that it is vital that we meet the Government's ambition of achieving an additional one million apprenticeship starts by 2013.
Apprenticeships work for both businesses and individuals - providing companies with a skilled workforce to help them grow and giving people of all ages hands-on experience, guidance and qualifications, to help them develop real skills in their chosen career. So, not only will these apprenticeships inject a much needed financial boost into our struggling economy, but they will also help tackle the current unemployment levels and ensure that businesses have the skills they need for their future growth.
As the leading apprenticeships provider, City & Guilds is committed to working with employers, training providers and the Government to provide the tools, support and inspiration needed to achieve our goal."
Steve Holliday, CEO of the National Grid said: "Business leaders are increasingly recognising that apprentices are key to the future of this country and today's research highlights just how important apprentices are in aiding the UK's economic recovery.
At the National Grid, we are committed to ensuring that our staff have access to high quality apprenticeships. That's why it is great to see City & Guilds working with employers to help solve the challenges around hiring apprentices to ensure that more organisations are able to offer places."
City & Guilds' insight into the economic value of apprenticeships
The report draws on available data and documentary evidence on the nature of future skills demand, the economic contribution of apprenticeships and the impact that such skills investment has on business productivity, enterprise and earnings, as well as existing data from previous City & Guilds' reports.
The report forms part of Million Extra, City & Guilds' campaign launched in 2011 to help ensure one million apprenticeship starts by summer 2013. The report's data sources have enabled the development of an econometric model, which projects the effect of achieving this goal and takes into account the direct impact on businesses and the wider UK economy.
With more apprentices developing their skills in one of 1000 approved City & Guilds apprenticeship training centres, City & Guilds offers over 300 apprenticeships in industries from management to retail; animal care to plumbing.
Key report findings
Economic impact of creating a million extra apprenticeship places by 2013 *
Value to business per annum by 2014 £459 million
Value to business per annum by 2017 £602 million
Cumulative value to business 2012-2020 £4.37 billion
Wider impact on the UK economy of creating additional apprenticeship places
Cumulative tax impact 2012-2020 £1.2 billion
Wider economic impact (net value) per annum by 2020 £55 million
Largest beneficiaries (net value) of creating additional apprenticeships (2012-20)
Engineering £267 million
Construction £259 million
Customer Services £201 million
Business Administration £180 million