GOVERNMENT is hoping a £1bn pot of money will help create 200,000 jobs for the young, or rather, those aged under 25 and that employers, including those in flooring, will prick up their ears.
The policy announcement came after government said apprenticeship starts among the young were down 40% in the last decade and that ‘almost one million young people aren’t earning or learning – a rise of 248,000 between 2021-2024’.
In overview
Government is putting in place a new Youth Jobs Grant through which businesses will receive £3,000 for every young person they hire aged 18-24 who has been on Universal Credit (UC) and looking for work for six months.
There’ll be an expansion of the Jobs Guarantee to a wider age range, from 18-21 to 18-24. There’s also an apprenticeship incentive of £2,000 for each new employee aged 16-24 taken on by an SME, along with further reforms to the growth and skills levy to prioritise young apprentices.
But for small contracting firms, it’s government’s new £3,000 incentive for hiring young unemployed workers that ought to sound like a welcome boost. With tight margins and the risk and cost of taking on staff – let alone a new apprentice or trainee – it should, at least on paper, lower the cost and risks to employers.
Will it work?
But in the long run, will the incentive actually make a (lasting) difference? More importantly, what can smaller contractors do to encourage the young into the trade and keep them?
Of course, £3,000 will help, but only tangentially as it may encourage some to take on an apprentice or nudge a hesitant employer into giving someone a chance. But on its own, £3,000 is unlikely to reverse the long-term decline in apprenticeship uptake or solve the deeper challenges facing the industry.
It’s worth noting that, not unsurprisingly, opposition parties weren’t overly keen on the proposals. For the Conservatives, Helen Whately MP said state-funded jobs were ‘economic madness’ and ‘not the answer’. She added: ‘The best way to tackle youth unemployment is to back businesses to create jobs, not tax them out of existence to fund benefits and subsidies.’
It’s why the Conservatives say that they would ‘roll back Labour’s Employment Rights Act’.
LibDem MP Steve Darling commented, in parliament, that they ‘don’t understand why government is removing funding for apprenticeships for management. Surely managers are the people who support young people in their hour of need, as they go into work?’
Beyond the political comment is commentary from bodies such as the Edge Foundation that supports education. It acknowledges the schemes but says that ‘SMEs also need practical support to navigate the apprenticeship system, from understanding the full range of incentives available to finding the right training provider and identifying an apprenticeship standard that meets their skills needs… almost half of SMEs are unaware of the existing grant for 16–18-year-old apprentices…’
And then there are issues specific to flooring in that there is limited training provision. There are fewer colleges that offer flooring-specific courses, apprentices sometimes have to travel long distances, and training availability varies by region.
So, even though funding for floorlayer apprenticeships has improved in recent years, the sector is caught by a capacity bottleneck.
Helpful, but not a panacea
Clearly, any cash handout will garner attention and for a small contractor, £3,000 will cover a significant chunk of wages early on while the individual is learning and not yet productive.
However, it’s likely firms that claim the incentive might have hired anyway; the money doesn’t fundamentally change the financial equation. Next, as it’s a one-off payment it won’t address what happens after the first few months, when the real work of training, mentoring and retaining the worker begins.
And of course, £3,000 won’t deal with the real reasons why fewer young people are choosing construction-related trades in the first place.
The young look elsewhere
While contractors may comment that ‘the young aren’t interested’ in their trade, looking at it from a different perspective – that of the young worker – construction-related work is invariably seen as hard work, dirty, unstable and with no clear progression. It doesn’t help that schools prioritise academic routes.
And then there are the practical issues of early starts and late finishes (sometimes overnight work) and travel to sites. Those with no link to contracting feel unwelcome.
Small contractors (should) have the advantage
Smaller firms and organisations should have a real advantage precisely because they are small and so can offer a more personal, hands-on experience. Apprentices that work directly with experienced tradesmen can learn a wide range of skills and feel part of a team.
The key, then, is to communicate and structure the process effectively.
This means the first few months are crucial. Many leave not because they dislike the work, but because their initial experience is poor.
Sometimes, new starters are thrown straight in with little guidance – they perform basic tasks without understanding how it fits into the bigger picture; they lose confidence and motivation.
The solution is simple – provide a solid introduction to the job and the company, explain what they’ll learn and how they will progress, assign a mentor who takes responsibility for their development, and set small, achievable goals in the first few weeks.
It should be obvious, but when young workers feel supported and can see progress, they’re far more likely to stay.
Build a pipeline
Many small firms only think about recruitment when they need someone. However, a better approach would be to build relationships earlier, say, by connecting with local schools or colleges, offering short work experience placements, and inviting students to visit.
This helps the young see for themselves how the trade works and also helps contractors identify potential talent well in advance of a hiring decision.
Making progression visible
University tends to have clarity of progression while construction can feel less structured, even when opportunities exist.
Small contractors can address this by talking about the skills an apprentice will have after one year, the roles they could move into after completing their training, and what a long-term career in the business looks like.
Even small firms have routes that they can highlight — becoming a skilled tradesman, moving into measuring and estimation, or some form of supervision and management. Give the young a future and they’ll be more likely to commit.
Use the incentive wisely
The £3,000 incentive shouldn’t just be used to reduce costs. Instead, contractors could use it to pay for mentoring and supervision, basic training or tools, or help with a structured introduction.
Another option is to take on more than one young worker at a time. A small group may create peer support, reduce isolation, and make the experience more engaging and enjoyable.
Summary
The £3,000 from government is helpful and may encourage firms to take a chance on the young. But it doesn’t guarantee success. For any (small) contractor, the real impact will come from what happens after the individual is taken on.
By improving the first experience, building early connections with potential apprentices, communicating the realities of the job more effectively, and demonstrating there’s more to flooring than just hard graft, firms will do far more than any single policy or £3,000 incentive… it’s about making the trade a place where the young can see a future — and, importantly, want to stay.
Gary Bricknell, director, Mosaic Restoration Co
GARY Bricknell isn’t a fan of the proposals. In fact, he thinks they’ll make not a jot of difference. He illustrates what he means:
‘If I took on a 21-year-old who must have received UC for at least six months on the new National Living Wage of £12.71, which is actually £14.52 with company NI and pension, the total cost is £28,308 per year.’
He continues: ‘If my company operated on a 10% net profit, I’d need to generate over £280,000 in turnover to cover their costs – then multiply this by three years.’
Bricknell reckons that with employee sick, holiday and maternity employment rights, ‘without taking into account the actual training costs, £3,000 would be a very poor commercial decision’.
His company offers training and he would like to offer more – ‘it’s an important part of my business future planning and longevity’.
However, he says that under the present government, together with increasing tax and inflation-related costs – by this he’s referring to energy and business rates, ‘there’s no way I’d consider this so called ‘youth employment drive’.’
Bricknell offers a different solution – an incentive where firms that train the young are given the actual UC cost that would have come out of the benefit system while at the same time, not charging the company any NI and pension costs for three years.
Under this system he would say – ‘forget the £3,000 so-called incentive… I’d take on young people with no loss to government without screwing over small businesses’.
