Nearly half of employers have not hired apprentices in the last three years, according to a Chartered Institute of Personnel and Development (CIPD) survey.
Almost 70% said the snub was because apprenticeships were considered inappropriate for their organisation.
The findings came in a CIPD 2011 Learning and Talent Development Survey that aims to highlight the need for Government to work with employers to promote the business case for investing in apprenticeships.
Only 35% of the 500 employers surveyed intended to recruit apprenticeships this year. Over 40% said they do not intend to recruit apprenticeships this year and over 22%.
The survey was conducted before the Budget announced greater funding for apprenticeships.
The findings indicated this funding injection will help boost apprenticeship places. Just under half of the respondents reported in January that more generous public funding would encourage their organisation to create new or additional places.
Katerina Rudiger, skills policy adviser, CIPD, said: "The CIPD welcomes the additional funding for apprenticeships introduced by the government. Our research shows that this will encourage firms to offer apprenticeships. The fact that many employers think apprentices are not right for their organisation, however, demonstrates that funding alone is not enough."
Rudiger added: "The government therefore needs to do more to make the business case to employers, highlighting the benefits apprentices can bring to organisations, such as relevant skills, loyalty, higher quality and greater productivity."