Apprenticeship Funding and Employer Incentives

• 100% government-funded apprenticeship training for many non-levy employers recruiting under-25s
• £2,000 SME Apprenticeship Hiring Incentive
• £1,000 additional payment for eligible apprentices
• £3,000 Youth Jobs Grant through the Youth Guarantee
• National Insurance savings for qualifying apprentices under 25
• Levy transfer opportunities available

Hiring an apprentice is one of the most cost-effective ways to develop new talent, upskill existing employees and address skills shortages within your business. Government funding continues to make apprenticeships an attractive investment for employers of all sizes, with new support available from the 2026/27 funding year.

Our Employer Engagement Team will guide you through every stage of the process, helping you maximise available funding, access levy transfers where possible and identify any employer incentives you may be eligible for.

Non-Levy Employers

The government has significantly increased support for smaller employers.

100% Government-funded training for under-25s

From August 2026, non-levy employers benefit from full government funding of apprenticeship training and assessment costs for apprentices aged under 25, up to the funding band maximum. This removes employer training contributions for many SMEs and makes recruiting young apprentices more affordable than ever.

Apprentices aged 25+

For apprentices aged 25 and over, employers may be required to make a contribution towards the cost of training and assessment, in line with current government funding rules.

However, many large organisations choose to transfer unspent Apprenticeship Levy funds to smaller employers. These levy transfers can cover apprenticeship training and assessment costs up to the funding band maximum –  significantly reducing, and in some cases eliminating, training costs for the employer.

Dudley College works closely with employers across the region to identify levy transfer opportunities and secure available funding wherever possible. Our team will guide you through the funding process, advise on any costs that may apply, and help you access the most appropriate funding support for your business.

Levy-paying employers

If your annual PAYE bill exceeds £3 million, you contribute to the Apprenticeship Levy (now transitioning into the wider Growth and Skills Levy framework). Funds held within your apprenticeship service account can be used to pay for apprenticeship training and end-point assessment costs.

If available levy funds are insufficient to cover the full cost of training, employers may be required to contribute towards the remaining balance in line with current government funding rules.

Employer incentives and additional support

Up to £6,000 available when hiring eligible young people

NEW: £2,000 SME apprenticeship hiring incentive

From 1 October 2026, eligible non-levy employers can receive a £2,000 cash incentive when recruiting a new apprentice aged 16–24.

To qualify:

• The employer must be a non-levy payer
• The apprentice must be aged 16–24
• The apprentice must have commenced employment within the previous 90 days before their apprenticeship starts

The payment is expected to be made in instalments and sits alongside funded training support.

£1,000 additional employer payment

Employers continue to receive a £1,000 payment when recruiting:

• Apprentices aged 16–18
• Apprentices aged 19–24 who have an Education, Health and Care (EHC) Plan
• Apprentices aged 19–24 who are care experienced

This funding is designed to support employers in creating opportunities for younger people and those requiring additional support.

£3,000 Youth Jobs Grant

As part of the Government’s Youth Guarantee, employers may also be eligible for a £3,000 Youth Jobs Grant when recruiting a young person aged 18–24 who has been claiming Universal Credit and has been unemployed for six months or more. Funded and administered directly by the Department for Work and Pensions (DWP), the grant is designed to help employers offset recruitment, induction and training costs while creating meaningful employment opportunities for young people.

Available to employers of all sizes, the grant is paid in stages once employment and earnings criteria have been met and may complement apprenticeship opportunities where eligibility requirements allow.

National Insurance Savings

Employers do not pay employer Class 1 National Insurance contributions for qualifying apprentices under the age of 25 who earn below the upper earnings threshold, creating further savings alongside apprenticeship funding and employer incentives.

English and Maths support

Where required, full funding is available to support apprentices in achieving the English and maths qualifications needed to successfully complete their apprenticeship programme.

Talk to us

Our Employer Engagement Team can help you navigate apprenticeship funding, identify available grants and incentives, and secure levy transfer opportunities where available. Whether you are recruiting your first apprentice or developing an existing workforce, we’ll help you maximise the support available to your business.

Contact us today to discuss your apprenticeship recruitment and training needs.

Complete the form online and we will get back to you, or contact us via email at employerservices@dudleycol.ac.uk or call 01384 363 808.