The Advantages of Apprenticeships
England's expansion of apprenticeship programs in recent years has led to significant economic benefits, both for the workers -- often high-school graduates entering the workforce -- and for the participating businesses, write Center for American Progress policy analyst Sarah Ayres and special assistant Ethan Gurwitz in a new paper.
Should the U.S. take note, and try to expand apprenticeship programs here? We recently spoke with Gurwitz to learn more. The conversation has been edited for length and clarity.
What's the difference between an apprenticeship and an internship? And why are workers better off in an apprenticeship?
An apprenticeship is a job in which an individual can learn a set of skills through on-the-job training coupled with classroom instruction. In the United States, we have a formal system of registered apprenticeships. It was created in 1937 under the National Apprenticeship Act, and is overseen by the U.S. Department of Labor and individual states. When an apprentice completes the necessary requirements, the government issues a certificate of completion, and this serves as a nationally recognized portable credential.
So, a registered apprentice lasts between one and six years, with an average of four years, and they're run by employers, employers' associations, and labor-management organizations. The costs are usually borne almost entirely by the sponsors, so the sponsor will pay for an apprentice's wages, all of the training costs, and often much of the tuition for their classroom instruction. Now, unlike most interns, apprentices are paid employees who earn a paycheck for their work, starting at 50-60 percent of their eventual professional wages -- this is in the U.S. Additionally, an apprentice's wages go up as they progress through the program and master additional skills, and apprenticeships can dramatically raise worker's wages from the moment they finish training. Finally, those who finish their apprenticeships receive national industry certification, which is portable and valuable, in both Europe and the U.S. This ensures that their skills are both transferable and stackable to other companies and industries.
To summarize -- an apprenticeship provides the younger worker with an immediate job; steady, rising wages; and a gateway into successful and sustainable long-term careers.
How can establishing apprenticeship programs create benefits for businesses and the economy?
The first thing is that companies do apprenticeships because it's good for business. Apprenticeships are a particularly successful training model. Currently, too many American workers lack education and training to secure their well-being–slash–jobs, and American businesses increasingly rely on high-skilled workers to innovate and expand. Apprenticeships hold great promise for addressing our nation's economic challenges.
Nearly all employers who sponsor apprenticeship programs recommend them. A survey of registered apprenticeship sponsors in the United States found that 87 percent of sponsors would strongly recommend registered apprenticeships. Businesses can train workers for jobs that they know will need to be filled due to a lack of candidates with the requisite training. While employers take on significant costs to sponsor apprenticeships, they also benefit from paying lower wages to workers while they're in apprenticeships. In a recent study, two-thirds of sponsors said that saving money on employer wages was somewhat important, as it allowed them to recoup the cost of running an apprenticeship program. Finally, businesses in countries with more expansive apprenticeship programs show very high levels of satisfaction.
Apprenticeships have been shown to offer significant benefits to workers, employers, and the economy as a whole. Studies show that, on average, they make a weekly wage 10 percent higher than their peers, and are 4 to 6 percent more likely to be employed than workers who have not completed an apprenticeship. Finally, they're estimated to raise an employee's economic output by 214 pounds per week.
You say that apprenticeships are much more common in England than they are here. What did England do to promote apprenticeships, and what are the lessons for the U.S.?
Between 2009 and 2012, England more than doubled the number of people starting apprenticeship programs each year, while also expanding the gender and occupational reach of apprenticeships. So England increased their marketing, they established a business outreach, and they created financial incentives for businesses to sponsor apprenticeships. To add to that, they designed a National Apprenticeship Service and launched a national marketing campaign in 2013 called "New Era for Apprenticeships," and this helped them to better promote apprenticeships to students, families, and employers. And they provided a comprehensive Web interface that offers applicants a number of user-friendly tools to help them navigate through the apprenticeship process. Now the National Apprenticeship Service also offers sophisticated apprenticeship vacancy matching tools, to assist employers in prospective apprenticeships -- in sort of finding each other. Finally, England, as I previously mentioned, has a number of financial incentives for employers to sponsor apprenticeships, including paying for training costs, a 1,500-pound grant, and an apprenticeship minimum wage.
And what are the lessons the U.S. can take from that?
President Barack Obama recently proposed an ambitious goal, to double the number of apprentices in the United States over the next five years. Using England as an example, the United States can achieve this by increasing our marketing of apprentices, engaging in business outreach, and creating financial incentives for companies to hire apprentices. As outlined in the report Training for Success: A Policy to Expand Apprenticeships in the United States, these proposals can connect workers to good jobs, enable businesses to boost their productivity, and offer taxpayers a high return on investment.
You mention that since 2010, workers ages 25 and older have made up more than 40 percent of those starting apprenticeship programs annually, and the issue persists despite efforts to target a younger group. Is this because young people tend to spend years in the education system acquiring degrees, and could the apprenticeship diploma eventually replace the college degree for certain fields?
For individuals who are unable or unwilling to take time out of the labor market to pursue a four-year degree, an apprenticeship can be a perfect fit. Apprenticeships offer high-school graduates a path to well-paying middle-class careers that do not require them to obtain a four-year degree before entering the workforce. Today's high-school graduates must consider record-high college costs and student debt, and are often without sufficient information to confidently evaluate the quality of colleges.
At the same time, few students and their parents are aware that apprenticeships can help to achieve a long-term career and sustainable wage premiums without a college degree. So expanding awareness of apprenticeships can actually open the door to an alternative career path for high-school graduates, without precluding further four-year-degree education. Furthermore, we believe that expanding apprenticeships in the U.S. can play an important role in meeting the demand for skilled workers, improving wages, and adding economic opportunities for workers, boosting U.S. businesses, and bolstering American competitiveness.
You say: "Women are disproportionally employed in lower-wage occupations, and men are disproportionately employed in higher-wage occupations. This occupational gender segregation has been shown to increase the gender wage gap." How can apprenticeships change this?
In England, over the past decade apprenticeships have been relatively balanced. Since 2010, women actually started more apprenticeships than men, making up more than 55 percent of all apprenticeship starts in the 2012 academic year. While the relative participation rates for women and men in apprenticeship programs are balanced, many sectors and occupations are segregated by gender. So for example, men dominate within England apprenticeship programs in construction and engineering, while women dominate apprenticeships in health care. In 2012, only 6 percent of active apprenticeships in the United States were held by women, up slightly from 5 percent in 2008. This is not surprising, given that women make up no more than 6 percent of any of the top ten apprenticeship occupations in 2012, which are all in the traditional skill trades.
It will be necessary to introduce apprenticeships to occupations that have not traditionally used apprenticeships. In doing so, we can also increase the share of women who become apprentices.
Christina Breitbeil is a RealClearPolitics editorial intern.
[Editor's note: The above text has been corrected; the original misstated the degree to which those who've had apprenticeships are more likely to be employed.]