$100 million boost to apprenticeships a win for local businesses

Illawarra Business Chamber has welcomed a new $100 million funding boost from the Federal Government to assist employers to take on apprentices in skill shortage areas.

"This is a great win for local businesses and will provide additional incentives for business owners to take on apprentices over the summer," said Greg Fisher, Illawarra Business Chamber Chief Executive Officer.

In the submission, Maintaining Trade Apprenticeship Numbers During the Downturn, The IBC in conjunction with the NSW Business Chamber recommended that the Australian Government:

1. Significantly increase financial incentives available to small businesses to reflect the length of contract and long-term benefits to the Australian economy of trade apprenticeships
2. Weight incentive payments towards the first two years of an apprenticeship to reflect the higher supervision cost and lower productivity during the early years

As a result, the Government's Apprenticeship Kickstart program will triple the first year bonus paid to employers who take on traditional trade apprentices this summer. The commencement bonus will increase from $1500 to $2350 followed by another $2500 paid nine months later, for a total of $4850 in the first year.

"This program is directed at boosting apprenticeships in trade areas hardest hit by the skills shortage. That includes trades like butchers, bakers, bricklayers, carpenters, electricians, hairdressers and pastry cooks."

Mr Fisher said that the IBC in conjunction with the NSW Business Chamber had been campaigning on behalf of the Illawarra business community to help secure this boost to apprenticeship funding.

"We are very pleased to see the Minister for Employment, Mark Arbib taking a long-term view of the need to invest in apprenticeships even during an economic downturn. He has taken to heart the lessons of the early 90s recession in which apprenticeship numbers plummeted and took a decade to return to pre-recession level which contributed to the skills shortage.

"Encouraging employers to take on apprentices will help ensure the national economy is not caught without the expertise we need when the economy returns to full capacity."

The Apprenticeship Kickstart bonus will be available for apprentices aged 19 and under, hired between 1 December 2009 and 28 February 2010 or until 21,000 apprentices have commenced in the areas identified in the National Skills Need List.