Employing apprentices has a hugely beneficial impact on overall business performance, according to an independent survey for the Learning and Skills Council (LSC) in England.

The survey, published at the start of the first National Apprenticeship Week, found that more than 75% of organisations felt their apprenticeship programme made them more competitive, while the same number believed apprenticeships led to higher productivity.

"Moreover, the survey shows that without apprenticeships the outlook for the country's business looks bleak, as 83 % of employers rely on their apprenticeship programme to provide the skilled workers they need for the future," says the LSC.

"Two-thirds of respondents claim that they would struggle to find trained staff with the skills they need without their apprenticeship programmes, highlighting the impact apprenticeships are having on addressing skills shortages."

Four firms out of five believed that their programme improved staff retention and turnover, two-thirds said it helped them fill vacancies more quickly, while 88% believed apprenticeships "lead to a more motivated and satisfied workforce".

Almost 60% of firms reported that training apprentices was more cost effective than hiring skilled staff and led to lower overall training costs, while 53% said it reduced recruitment costs.

Stephen Gardner, director of apprenticeships at the LSC and a former apprentice himself, commented: "The impressive return on employers' investment shows that apprenticeships are an excellent way to improve the bottom line, helping build the workforce employers need for future success.

"There are currently 130,000 companies reaping the benefits of apprenticeships, and we are calling for even more employers to open their doors to apprentices."

Skills Minister David Lammy MP commented: "Apprenticeships have a vital part to play in ensuring our nation's competitiveness, which is why the government is committing more than £1bn to increase the number of apprentice places by 2010-11."