Only a third of employers plan to take on more apprentices because of a new levy aimed at boosting numbers - while some will cut their training budget to pay for it, a study shows.
A survey of 500 senior staff found that a third of those eligible to pay the levy were not even aware of its existence.
The levy comes into force in April, requiring employers with a paybill of more than £3 million a year to pay 0.5% of it to fund apprenticeships.
The aim is to increase the number of apprenticeships in England to three million by 2020.
Skills group City & Guilds said its research found that almost one in four Heads of Apprenticeships in companies were not aware of the new system.
Two thirds of those polled said they would not be employing more apprentices because of the levy.
Kirstie Donnelly, managing director of City & Guilds, said: "The lack of awareness about the new apprenticeship system among our respondents is a cause for concern and shows that we still have a hill to climb in convincing people about the benefits apprentices can bring to business.
"However, those that do know about the levy are saying it is a great way for employers to pay for training, so there is clearly understanding and appreciation of apprenticeships out there.
"With just two months to go until the levy begins, it's vital that everyone in the skills sector and Government communicates with these less enlightened businesses to help them see the huge potential benefits apprenticeships can bring."
Around one in seven of those surveyed said they would cut other recruitment schemes to pay for the levy.