10 Things Employers Should Know Before Recruiting an Apprentice

When employers think about apprenticeship funding, they often think about the cost of the training programme. 

But depending on who you’re hiring and their circumstances, there may also be government incentives and National Insurance savings available. 

For eligible employers, these can include a £2,000 apprenticeship hiring payment, a £1,000 young apprentice payment, a £2,000 foundation apprenticeship incentive and a £3,000 Youth Jobs Grant. These are separate from apprenticeship training funding and, where an apprentice qualifies for more than one, the payments can stack. 

Tip: Don’t just ask “How much does the apprenticeship cost?” Ask “What funding and incentives could my business access?” 

Your route to apprenticeship funding depends partly on the size of your organisation and whether you pay the Apprenticeship Levy, which became the Growth and Skills Levy in April 2026. 

For non-levy employers, the government generally funds 95% of apprenticeship training costs, with the employer contributing the remaining 5%. For eligible apprentices under 25, training can be fully funded in certain circumstances. 

Tip: Understand your funding position before you start recruiting. 

For example, the £1,000 young apprentice payment is available for eligible apprentices aged 16–18, with some eligibility for 19–24-year-olds with an Education, Health and Care Plan or care leaver status. 

The new £2,000 apprenticeship hiring payment is available from 1 October 2026 for eligible non-levy employers taking on a new employee aged 16–24. 

Tip: Check the apprentice’s age when their training starts, as this can affect eligibility. 

One of the most important changes for employers to understand is that the government payments can stack where an apprentice meets the relevant eligibility criteria. 

That means the potential value can be considerably greater than a single headline incentive. 

For example, Lifetime’s current guidance gives an example of an eligible 18-year-old foundation apprentice who is a new hire and has been receiving Universal Credit for six months or more. In that example, the combined incentives and potential National Insurance saving total around £10,000. 

Tip: Look at the apprentice’s full circumstances rather than focusing on one payment. 

An apprenticeship can be a route into your organisation for a new recruit, but it can also be a way to develop someone who is already part of your team. 

Existing employees can use apprenticeships to build new skills and progress within your organisation. 

The key requirement is that the apprenticeship must develop new skills rather than simply recognise skills the employee already has. 

Tip: Look across your workforce as well as your recruitment plans. Who could you develop next? 

While the cash incentives available through the current schemes generally stop at age 24, apprenticeship training funding continues to be available for older apprentices. 

For example, a non-levy employer recruiting an apprentice aged 25 or over would generally contribute 5% of the training cost, with government funding the remaining 95%. 

Tip: Don’t rule out apprenticeships because of age. They can be a valuable development route at every career stage. 

The apprenticeship funding landscape has changed substantially during 2026. 

Funding is important, but it shouldn’t be the reason you choose an apprenticeship that doesn’t meet your business needs. 

Start with the skills your organisation needs to build. 

Then consider which apprenticeship programme best supports those needs and what funding and incentives may be available. 

Tip: Think skills first, funding second.