Non-Levy Incentive: Why Now is the Perfect Time to Hire a Young Apprentice

For many small and medium-sized businesses (SMEs), hiring can feel like a constant balancing act between cost and capability. But right now, there’s a real opportunity to bring in new people without the usual financial pressure. 

If your business doesn’t pay the Apprenticeship levy, government support makes hiring a young apprentice far more affordable than most employers realise. In some cases, the cost of training is fully covered, and additional incentives are available when you take on someone at the start of their career. 

That means you’re investing in someone who can grow with your business from day one. 

Bringing in a young apprentice helps shape a future employee around your business needs as well as giving the person the opportunity to gain the experience to grow the essential skills businesses require when hiring. 

Unlike traditional hires, apprentices are trained specifically for the job they’re doing. They learn your systems, your processes, and your way of working while contributing to the business at the same time. For many employers, this leads to better long-term retention and a more committed workforce. 

When that training is largely funded for you, the return on investment becomes even more compelling. 

The government has announced a new financial incentive designed specifically to support smaller businesses hiring young apprentices. From 1st October 2026, non-levy employers will be able to access up to £2,000 when they take on an apprentice aged 16 to 24 as a new employee. 

To qualify, the apprentice must have joined your business within the previous three months, meaning this will apply to hires from July 2026 onwards. 

While full details are still being finalised, this marks a significant increase in support compared to the current £1,000 incentive and signals a clear push from government to encourage businesses to invest in young talent. 

For non-levy employers, this changes the economics of hiring. 

With training already heavily funded and often fully covered for younger apprentices, this additional incentive effectively reduces the cost of recruitment even further. Businesses will now be able to bring in and develop new talent with minimal upfront investment, while also receiving direct financial support for doing so. 

This is a huge benefit for employee retention and longevity, which will also reduce employee turnover and hiring costs in the long run. 

Although the incentive doesn’t officially launch until October 2026, waiting until then could mean missing out. As it states, if you hire someone aged 16-24 in July, you can enrol them onto an Apprenticeship by the time the new employee has been with your company for three months. 

It also takes time to identify the right role, recruit a candidate, and enrol them onto a programme. Starting early ensures everything is in place when the funding becomes available.