Cost effectiveness

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24 / 9 / 2015 11.02am

In brief

  • In the long term, investing in young people’s development and training will reward you with employee loyalty and a workforce with the skills that you need
  • Research into apprenticeships has shown that the cost of training is recouped within two years
  • Funding incentives are available for employers bringing apprentices into their organisations 

Evidence

Investing in young people will foster great loyalty, particularly in today’s challenging marketplace. People who undertake their initial training with an employer are more likely to stay with that employer, so your initial investment really does pay off. (CIPD)

The cost effectiveness of employing young people becomes much more evident when looking at the impact on your future workforce. You will find that there are significant longer term cost benefits in employing young people. By investing in training and development, you will benefit from a highly skilled, loyal workforce that is tailored to your needs. A UKCES report report states that investing in young people tends to enhance loyalty and reduce staff turnover which will help productivity and reduce future recruitment costs. 

In May 2014, The Department for Business, Innovation and Skills published a study, Employer investment in apprenticeships in the health sector, which looked at the costs of three broad apprenticeship frameworks delivered within the NHS - clinical support, business administration, and engineering. The report suggests that employers believe apprenticeships delivered the skills they needed and that in most instances, the costs of training could be recouped over 1-2 years.

Whilst this report may be specific to apprenticeships, the benefits of investing in training for young people are clear and could be applied to any young people you recruit and train. Find out more about apprenticeships on our web pages. 

There are options available to you as employer in terms of employing young people. All employees receive the same salary under Agenda for Change banding regardless of age. However, it is useful to know that there are financial incentives available from the government for apprenticeships. Furthermore, an employee who undertakes all of their training on the job is paid a percentage of the full salary depending on the number of years left to complete their training, so salary costs can start off lower at the beginning.  For further information, see information on Annex U in the NHS terms and conditions of service handbook (page 262)  and contact our pay team if you need any more advice.

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