Autotrader
AutotraderA UK-based digital automotive marketplace that has been connecting car…
Government Funding to Hire an Apprentice: Guidance for Employers
Date
Author
GOVERNMENT UPDATE
The Government has announced significant changes to apprenticeship funding to help non-levy (SME) employers invest in skills, recruit apprentices, and address workforce shortages. These changes create new opportunities for businesses to access funded training and receive financial incentive when hiring apprentices. This guide explains what is changing, who is eligible, and how employers can benefit.
Why Are Apprenticeship Funding Changes Being Introduced?
The Government’s aim is to increase apprenticeship participation, particularly among young people entering the workforce, while helping employers tackle skills gaps and develop talent pipelines. The Creative and Digital sector is one of the key areas that the Government is focussing on as a growth area.
The changes form part of wider reforms to the apprenticeship and skills system, with additional funding being directed towards employers who recruit and train apprentices.
New Employer Incentive Payments from October 2026
For SME’s
GET £2,000 per apprentice
One of the significant changes is the introduction of a new employer incentive payment.
This incentive is designed to encourage the recruitment of apprentices aged 16–24 and support employers with the costs associated with onboarding and developing new talent.
Who Can Claim?
The funding is expected to be available to:
- Non-levy paying employers (SMEs)
- Employers recruiting apprentices aged 16–24
- Businesses employing apprentices who have joined within the 90 days before the 1st October
How Will Payments Be Made?
Further guidance will be published by the Government ahead of implementation, but based on previous funding; it is usually split in the following fashion: half towards the beginning of the apprenticeship and half when they complete.
Fully Funded Training for Under-25 Apprentices
Another major change is the commitment for the Government to fully fund apprenticeship training costs for apprentices aged under 25 employed by non-levy paying businesses.
What Does This Mean for Employers?
For eligible employers and apprentices:
- A financial incentive that can be used by the employer.
- Businesses can recruit young apprentices without making a financial contribution towards training.
- Employers can focus investment on wages, mentoring, and workplace development.
This represents a significant reduction in the cost of apprenticeship recruitment for small and medium-sized businesses.
Why Employers Should Consider Apprenticeships Now
Apprenticeships offer far more than a route for school leavers. Employers across every sector are using apprenticeships to:
Address Skills Shortages
Recruit and train individuals with the specific skills your business requires.
Improve Staff Retention
Employees who receive structured training and development are often more engaged and loyal.
Increase Productivity
Apprentices learn while working, allowing them to contribute to the business from day one while developing new skills.
Build Future Leaders
Many employers use apprenticeship programmes to develop future supervisors, managers, and specialist professionals.
Common Employer Questions
No. Many apprenticeship programmes are designed for individuals who are completely new to the role or industry.
Yes. Apprenticeships can be used to upskill current employees as well as recruit new talent. You will not receive the employer incentive if a current employee has been with the business 90 days before 1st October 2026.
7 hours off-the-job a week: Apprentices complete structured learning alongside their normal job role, with training delivered through a combination of workplace learning and provider-led support.
Yes, Creative Alliance offers a completely free recruitment service and prides itself on finding innovative new talent.
- Vacancy promotion
- Candidate screening
- Recruitment guidance
- Funding advice
- Programme administration
How We Can Help
At Creative Alliance, we work closely with employers to simplify the apprenticeship process from start to finish.
Whether you’re considering your first apprentice or expanding an existing programme, we can guide you through every stage of the journey.
- Understand available funding and incentives
- Identify the most suitable apprenticeship programmes
- Recruit new apprentices
- Upskill existing employees
- Manage compliance and paperwork
- Maximise the return on your training investment
Get Ready for October 2026
With new employer incentive payments and increased government funding on the horizon, there has never been a better time to invest in apprenticeships.
Planning ahead now will allow your organisation to take full advantage of the upcoming changes and secure the talent needed for future growth.