Apprenticeship Programs Reach an Inflection Point

Apprenticeship Programs Reach an Inflection Point

When Techtonic, a Boulder, Colorado-based software development company, needed new talent, it turned to a very old solution: apprenticeship. 

 

For the past seven years, it has pioneered a training model that addresses the seemingly bottomless talent needs of the technology industry.

 

Facing a wave of skilled workers’ retirements, Georgia Power launched an apprenticeship program for lineworkers that paired novices with experienced workers. It lowered hiring costs by more than 50 percent and increased new hire retention by 18 percent.

 

As market conditions and workforce needs converge, American employers and policymakers have developed a newfound interest and enthusiasm with the apprenticeship model. But how long will it last? And what can employers and policy makers do to keep this interest going? 

 

Created in 2012, the Techtonic Apprenticeship is a fully accredited software development program, registered by the U.S. Department of Labor. Its goal: to provide both the company and the industry with more skilled technology workers while providing opportunities for people with diverse backgrounds to develop a career in technology. 

 

Thousands of programs and employers across the country recently celebrated National Apprenticeship Week. Other companies in a wide array of industries are beginning to engage with their own apprenticeships. Building trades apprenticeships, led by union and non-union organizations, remain some of the best in the nation, and this model is expanding to new industries like healthcare and IT.

 

IBM, The Hartford, CVS/Health, Aon, Vanguard, Siemens, and others are now in the apprenticeship business, using the learn-and-earn model as a way to grow their own skilled workforce and increase diversity. 

 

Techtonic’s CEO Heather Terenzio needed to educate herself about modern day apprenticeships — how they work, how they would help Techtonic grow, and what she needed to do to set up a high quality and rigorous program. She took advantage of apprenticeship resources that Congress has appropriated.

 

Federal and state support for these programs dates back more than 80 years, to the passage of the National Apprenticeship Act in 1937. Four generations later, apprenticeships are gaining recognition as an old solution to a slate of new problems facing U.S. businesses and workers alike. 

 

For an apprentice, the benefits are clear: a paid job, quality training, and skills that will enable her to further her career. While there may be an initial investment, many employers will tell you that they receive a significant return on that investment in subsequent years.

For businesses? The benefits are perhaps even clearer. A whopping 94 percent of workers who complete apprenticeship training stay with their employers, reducing employee churn and creating a more stable and productive workforce. Additionally, this model provides another avenue to fill the 600,000 entry-level postings currently requiring a degree that research from Harvard Business School suggests could be completed just as successfully by someone without a degree.

 

In a powerful Washington Post op-ed, Greg Case, chief executive of AON, and Julie Sweet, chief executive of Accenture North America, state their case for apprenticeship: “Make no mistake, this is not a social experiment — it’s a business strategy. Our companies expect to secure a competitive advantage by cultivating sources of talent long overlooked.”

 

But compared to the rest of the developed world, apprenticeship in the U.S. labor market has largely been relegated to the periphery, with fewer than 1 percent of the American workforce participating in a registered apprenticeship program. 

 

That may be starting to change. Buoyed by increased employer buy-in, bipartisan political support and unprecedented federal investment over the past five years — as well as tighter H-1B visa processes, which are putting pressure on tech firms to develop homegrown U.S. talent — next-generation apprenticeships are gaining momentum in a host of unconventional contexts. 

The number of Registered Apprenticeships has grown by more than 50 percent over the last five years. And the emergence of new youth apprenticeship models suggests a growing acceptance of industry-supported training as early as high school. One survey found that 97 percent of registered program sponsors would recommend the program to others.

 

In order to sustain this enthusiasm for apprenticeships, employers need to reach out to their communities — and vice versa — to learn about modern day iterations. Their first priority: to address myths and misunderstandings about the apprenticeship system in the U.S., and to develop high quality training that advances companies and their workers. 

 

They should also look beyond their company for help with internal talent development. Community colleges, high schools, labor unions, workforce boards and community-based organizations can jointly develop and deliver apprenticeship programs. One example: Aon developed a two-year program in coordination with City Colleges of Chicago to train workers in account management, client support, financial analysis, human resources, and information technology. 

 

In addition to the federal Office of Apprenticeship, employers can also work with state apprenticeship offices and a host of intermediaries, educators and training programs that can help guide employers through this process of setting up high quality apprenticeships.

 

At a time when the average student loan debt of a college graduate tops $28,000, students and workers are as willing as ever to take a fresh look at apprenticeship as a more affordable—and equally valid—pathway to a well-paying career. 

 

And when students, policymakers, and educators see a clear signal from employers of their commitment, apprenticeship may finally reach a long-awaited inflection point.

 

Eric Seleznow is senior advisor for JFF’s Center for Apprenticeship & Work-Based Learning.

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