IMI discovers profitability in apprenticeships

11 February 2014  

The IMI has concluded its research study into the value of apprenticeships, with figures showing that businesses could see a strong return on investment.

The institute is now calling on the automotive sector to overcome its doubts about employing young people and to future proof business by hiring apprentices. The research shows that by the end of their third year, a well-recruited apprentice can generate between 150% and 300% return on investment, based on a £50 hourly charge out. This means for every £1 invested, a business with generate between £1.50 and £3. Furthermore, apprentices who start with no experience typically generate profit within 18 to 24 months- much earlier than was previously assumed.

The research is  the result of a two-year IMI project, co-funded by the UK Commission for Employment and Skills. The study looked at a cross-section of businesses from micro-independents to franchise dealers across the whole of the UK, and involved 30 apprentices.

Steve Nash, the IMI’s CEO, comments: “Businesses must overcome their doubts about employing young people and invest in the future if our industry is to succeed as a whole.  Overwhelmingly, the results from our recent study have shown that there is a clear financial return to the business within the apprenticeship, but the attitude and support of the employer to the apprentice is critically important.  By giving a young person opportunities to apply their skills they will ultimately become better and more productive technicians much earlier than commonly perceived.”