The UK has very low productivity. In comparison to the average of the worlds 7 biggest economies, we are 16.6% behind. One of the things the UK government initiatives to fix this is to fund 95% of the training cost for an apprentice to help get more skills into SME businesses. This is funded by charging larger businesses an apprenticeship levy.
Why did I write this article?
Almost every article I found on the topic was an apprenticeship training provider trying to sell you their training service so I wrote a more unbiased, honest take on the subject from the perspective of an employer.
As a company, we have hired two digital marketing apprentices in the last two years and have found them a great asset to our business. We have learnt a few lessons over the last couple of years about having a digital marketing apprentice on your team which we would like to share with you.
If you decide to hire a digital marketing apprentice I have an option to get some help from us which may help you get the most from your apprentice and minimise your time investment (spoiler alert: thats a hidden cost)
What is a digital marketing apprentice?
A digital marketing apprentice is a full-time member of staff focused on helping the business with their digital marketing who has structured off the job training for typically one day a week and works in your business the other 4 days. The apprenticeship can vary in length, typically 18-36 months depending on the level on training.
How much does a digital marketing apprentice cost?
A business should budget between £27,167 and £27,667 per annum for a digital marketing apprentice. The cost consists of the following elements:
Off the job training (£550-1050) + On the job training (£12,584) + Wages (£7,605) + Line management time (£6,428) = Total £27,167-£27,667
Off the job training / College training costs (day release)
The "off the job training" is one of the cheap elements of an apprentice and depends on the type of apprentice and how big your company is. There are different levels of apprentices range from GCSE equivalent (level 2) up to a Degree equivalent (level 6 or 7).
The government pays 95% of the costs of training and the business pays 5% unless you have a wage bill more than £3m. Then it works differently, you can claim 110% of the training costs back from the Apprenticeship levy you pay already.
There two levels of digital marketing apprenticeship
Digital marketer - Level 3 (equivalent to A levels at grades A to E)
- Typical length - 18 months
- Funding available up to £11,000 (Maximum employer would pay £550)
- https://findapprenticeshiptraining.apprenticeships.education.gov.uk/Apprenticeship/Standard/78
Digital Marketer (degree) - 6 (equivalent to bachelor's degree)
- Typical length - 36 months
- Funding available up to £21,000 (Maximum employer would pay £1,050)
- https://findapprenticeshiptraining.apprenticeships.education.gov.uk/Apprenticeship/Standard/293
On the job training
As you would expect the apprentice will be coming to work with a limited amount of experience of your business and digital marketing in general. If you are a larger company you may have some established training courses/programmes that you could put the apprentice through. Even if you do this, the first day the apprentice is sitting at their desks and you ask them to do something you will need to train them. Even when you have told them what to do they won't know what questions to ask you because everyone starts unconsciously incompetent. They don't know what they don't know.
An American training industry report in 2017 said the average company spends £1547 on training a member of staff. I would estimate apprentice will need at 7-10x the amount of training could be £10,829-£15,470 per annum.
To work it out for your business you do not just take the salary per hour and multiply by the number of hours unless you have a dedicated trainer. You need to use a figure to represent the value the apprentice trainer produce per hour if they were not training the apprentice. For example, it is was a salesperson who generates £5000 revenue per week then based on a 37.5 hours week it costs £133 per hour, not just the per hour you might be paying that person.
The average revenue generated per employee across UK businesses is £118,000 so for a 37.5 hour week it works out £60.50 an hour if you want to use a simple number to figure out the cost of an hours training. In our experience an apprentice will need 4 hours a week training on average across the first year. It will be a lot more to start off with but less as the year goes on.
Wage costs
You only have to pay the apprentice the minimum wage.
You will probably want to work with your apprentice to make a clear plan about how they can add value in your business to help you pay them a higher salary than minimum wage as soon as you possibly can. Otherwise someone else might do it for you and the apprentice will leave.
I detail below the minimum costs before and after they qualify. In all cases, you will need to factor in employers national insurance contributions and pensions where required.
Minimum wage is exactly that, the minimum. You should be open about how the apprentice can add more value from day one and what they need to do to earn more than minimum wage. Others they may have an unhappy apprentice. It is a great idea to do this for all your staff not just your apprentice.
During apprenticeship
You will have to pay your apprentice at least minimum wage. (£3.90 per hour in 2019) this needs to include at least 20 days holiday.
Based on 7.5 days per week and 52 weeks a year your total wage bill (1950 hours per annum) will be £7,605 if you pay the minimum wage for an apprentice £3.90.
You will be paying them for a full week even if they are at college one day a week.
After the apprentice is qualified / When the apprentice is 19 and has completed their first year
The minimum wage increases as they get older as shown below. It also increases when the apprentice is over 19 and has completed the first year of their apprentice (they don't need to have passed their apprenticeship yet).
Line managers time
I will use 7 employees per manager for these calculations. Based on this research. The average salary for a manager is £45,000 PA so it costs 1/7th of that to manage an employee. It works out at £6,428 per apprentice.
In a small company, the line manager could be the business owner. So the line management time could be higher if their salary is larger.
More often than not in a small company the line manager will also be an individual contributor so they are getting work done themselves and not just managing the people that get the work done. In this case you will experience some additional costs due to productivity loss because an individual contributor is stopping contributing to help the apprentice. It is a good investment in the long term but could result in a hidden cost in the short term.
Benefits of hiring a digital marketing apprentice?
Get digital marketing skills into your business
If you need to communicate with people in any way a digital marketing apprentice will help you communicate more effectively.
If you have no digital marketing skills it will be a benefit to your business to have some.
Ramp-up your digital marketing
If you have an existing marketing team then it will benefit you because you will be able to get some assistance from an increasingly competent team member.
The apprentice will start to take responsibility for some of the work that needs doing in the marketing department.
Over time this will enable the more experienced member(s) of the team to focus on the more advanced aspects of marketing which is outside the scope of an apprentice.
Things you might overlook when hiring a digital marketing apprentice
Low or no productivity to start with
The biggest frustration you may find if not prepared for it is the length of time it takes to become a useful individual contributor in the business who can work independently.
When an apprentice first starts they will need a lot of hand-holding through tasks while they are learning. A task which might take you an hour an apprentice a whole day plus you may have to spend an hour or more telling them how to do it, helping them along the way and reviewing it afterwards.
You have to look at it as an investment in the future of your company otherwise no one would ever think it was worth it.
What they get taught at college may not be the way you want them to do it
Digital marketing evolves so quickly that the way they are being taught to do something might not be in line with the cutting edge industry best practises. It is worth bearing in mind that they will be assessed against the training providers approach not yours so make sure they fully understand the way the training providers wants them to do something so they stand a good chance of passing the assessment at the end.
It is ok to teach them different ways of doing things as long as they do what they need to do to pass the assessment.
Project work admin
A digital marketing apprentice will need to do some projects to evidence the things they have done in the workplace. There may be some overheads you need to factor in, for example, the student may need to document the brief in writing that they have been given. You may normally do this verbally because it is quicker but you would be helping the apprentice if you can write it down in an email. You can go through it verbally but it for the sake of clarity and to help the apprentice document what they have done a written down brief would be better.
Apprentice leaves after they finish
This hasn't happened to us yet (touch wood) but it is always something in the back of your mind. You invest a lot of time and money into an apprentice if they leave your investment goes with them. There is nothing you can do to guarantee they will stay but being a decent employer goes a long way. Talk to them about how they are finding their job. Try to make them feel like they can 100% honest with you so you can understand better how happy they are at work. It is your job to make sure every one of your employees is happy. If they don't find happiness and fulfilment in what they do then one day they might find it somewhere else. So put some thought into that before it becomes a problem. It is not just your apprentices, do it for all of your employees. Good employees are hard to come by so look after them and they will stick around.
Why digital marketing apprenticeships go wrong
There is not a digital marketing job to be done
Having a desire to do digital marketing is not enough to hire a digital marketing apprentice. You need to give them the right kind of projects to work on and the right guidance to make it worth doing for both parties.
From the conversations I have had with our two digital marketing apprentices, one of the biggest problems their peers faced was that they ended up being a glorified admin person and they leave the apprenticeship. In their experience, a significant percentage of apprentices end up in a company where the actual work they are doing is not digital marketing. This is not great because the apprentice will not get the relevant work experience to pass the endpoint assessment if they even make it to the end.
You think they are just cheap labour
You need to think of your apprentices as a future star in your business not just someone to do all the stuff you don't want to do. I am sure every apprentice will understand there are some elements of the job which will be more interesting than others. They may even enjoy doing things that you don't because it new and they have never done it before. However, if they don't get a balance of activities to do they will get bored and you risk them leaving.
You hire the wrong apprentice
It is just like any other employee except you don't have as much or any experience for them to discuss with you at the interview. Ideally, you would have an apprentice who has done some digital marketing even if it is unpaid or a project for themselves, whether that is building a website for their football team or growing/engaging a following on social media. They should have done some experimenting with digital marketing otherwise how do you know they actually want to do it for a living and won’t want to be a plumber next week instead?
Hiring for attitude is very important. You can teach someone skills but attitude is not so easy if it is even possible.
How to find and hire a digital marketing apprentice?
The best place to start is www.apprenticeships.gov.uk.
They have a good guide on the gov.uk site
- Decide if hiring an apprentice is the right option for your business. This article should help but also read this (they sell apprentice training so maybe a little biased in favour of apprentices)
- Decide what is the right type of apprentice for you (a search for digital marketing brings up 25 options)
- Decide where is the best training provider for your apprentice
- Understand what funding you can get
- If your wage bill is under £3m then the government will fund 95% of the training costs.
- If your wages bill is over £3m PA you will already be paying the apprentice levy which the government will give you back whatever you need to cover training plus 10% (if it is within the guidelines for each type of apprentice).
- You can advertise your apprentice position through your training provider on the government “Find an apprentice” site
- Decide how you will legally employee them
- Under contract with your company directly
- Through an apprentice training agency
- Welcome them on their first day with open arms and a smile
In summary
Although an apprentice might not be the right option for every business, for the right company it is a great option to bring new blood into your business to get new ideas and ultimately create a pipeline of talent which can grow into stars of the future of your business.
