Australian businesses are losing millions of dollars each year due to the constant churn of apprentices, most of whom abandon their training within the first 12 months, according to Phil Cooksey, General Manager of Apprenticeships Are Us Ltd (ARU).
“With 60 per cent of apprentices abandoning their training, it’s become a constant revolving door for employers. Businesses are regularly forced to replace apprentices who leave early, which severely impacts productivity and morale,” Mr Cooksey said.
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According to Mr Cooksey, the greatest financial burden is the ongoing loss of productivity as senior staff are repeatedly diverted to supervise new apprentices.
“Supervision is by far the biggest cost. Apprentices take time to become fully productive, especially in their first year. Each time a new apprentice starts, experienced staff are pulled away from their own work to guide them,” Mr Cooksey said.
“The amount of supervision required is most in the early stages and naturally reduces as an apprentice becomes more experienced. But when you’re constantly cycling through first-year apprentices, you’re stuck in that most expensive phase indefinitely.”
Recent data from the National Centre for Vocational Education Research (NCVER) shows a 17.4 per cent fall in overall trade apprenticeship commencements, with the greatest in Construction Trade Workers (down 18.6 per cent) and Automotive and Engineering Trades Workers (down 18 per cent).
“Cost of living pressures are a major factor. Young people are turning to unskilled labour or warehouse jobs that offer fast cash, even if they’re short-term or lead nowhere. That immediate financial relief wins out over long-term career thinking.”
Mr Cooksey said constant turnover not only affects output but also leads to higher recruitment costs and depleted staff morale.
“Every time we lose an apprentice, we start again. Employers are frustrated, their staff are overextended, and the quality of work suffers. Over the course of a year, that adds up to significant financial losses,” he said.
However, for businesses that do manage to retain apprentices beyond the first year, Mr Cooksey said the benefits are considerable.
“Apprentices trained in-house understand your systems, tools, and standards. They become loyal, long-term team members who are already culturally aligned,” Mr Cooksey said.
“With skilled trades in short supply, keeping an apprentice through to completion puts you ahead of the hiring curve. Retained apprentices are not just productive, they’re invested.”
While precise figures on the cost of replacing and re-skilling apprentices are limited, the economic impact is undeniable. High attrition, increased supervision costs, and the loss of institutional knowledge all point to the need for improved retention strategies.
“Business owners and apprentices need better strategies and incentives to stay. Without it, this churn will continue to cost our businesses and the economy millions each year,” Mr Cooksey said.