Apprenticeship in US – A strong intermediary is key to a strong program report finds

As detailed in the recent Center for American Progress report, “Training for Success: A Policy to Expand Apprenticeships in the United States,” apprenticeship is a workforce-training model that combines on-the-job training with classroom- based instruction and has been proven to benefit employers, employees, and the overall economy. Apprenticeships allow businesses to meet the growing demand for skilled workers, and they lead workers to higher wages and better employment outcomes. Furthermore, they are a smart public investment. A recent study in Washington state found that for every $1 in state investment in apprenticeships, taxpayers received $23 in net benefits, a return that far exceeds that of any other workforce-training program in the state.

Although apprenticeships have proven to be an effective workforce-training tool, the United States has been slow to pick up the model. The Department of Labor, or DOL, through its Office of Apprenticeship, administers a small system of registered apprentices. Last year, the United States had about 375,000 reg- istered apprentices, including 164,000 new apprentices who started programs in 2013. Per capita, these figures fall far below those of other nations, such as England, Switzerland, France, Germany, and Scotland. England, with a popula- tion one-sixth the size of the United States, had more than five times as many new apprentices as the United States in 2012.8 In England, a recent effort to expand apprenticeships has led to significant benefits for both workers and employers.

English apprenticeship completers earn an average weekly wage 10 percent higher than that of noncompleters. Businesses report that apprentices have increased productivity; supplied a consistent, skilled labor force; reduced recruiting costs; and boosted employee retention.9

There are a number of obstacles that have prevented the United States from estab- lishing a larger apprenticeship system, not least of which is a lack of awareness among both businesses and workers about the value and promise that apprentice- ships hold. Additionally, despite recent efforts by DOL to expand their reach, American apprenticeships are still largely dominated by traditional occupations, such as those in the building and construction trades. Unlike the governments of many other countries, the U.S. government offers little financial support to help employers offset the costs of sponsoring apprentices.

This may be changing, however, as U.S. policymakers increasingly look to appren- ticeship as a key tool to develop a skilled workforce and to connect workers to good jobs. The Obama administration is investing in apprenticeship by making $100 million available for American Apprenticeship Grants through the DOL. These funds will support promising partnerships, launch new apprenticeships in high-growth fields—such as information technology, health care, and advanced manufacturing—and scale models that work.

This report examines a suite of innovative apprenticeship models from around the country. It provides detailed case studies of Vermont Healthcare and Information Technology Education Center, or Vermont HITEC; the Michigan Advanced Technologies Training program, or MAT2; the SEIU Healthcare NW Training Partnership; the National Institute for Metalworking Skills, or NIMS, Certified Registered Apprenticeship program; and Apprenticeship Carolina. From effective marketing and business engagement to financial incentives and thorough skills assessments, these models exemplify a number of compelling strategies to expand apprenticeships into new occupations and sectors and to increase overall apprenticeship enrollment.

The efforts profiled in this report represent a range of strategies that enterprising worker training stakeholders have employed to establish apprenticeship pro- grams in high-demand, nontraditional occupations. When it comes to creating an apprenticeship program that engages multiple employers, there is clearly more than one way to structure it. These case studies, however, reveal three important commonalities:

1. A strong intermediary is key to a strong apprenticeship program. Whether it is a nonprofit such as Vermont HITEC, a state agency such as Apprenticeship Carolina, or a joint labor-management program such as the SEIU Healthcare NW Training Partnership, a successful, far-reaching apprenticeship program will have a strong intermediary. The role of the intermediary is to coordinate between stakeholders, including employers, educational institutions, the Department of Labor, and state governments. An effective intermediary will also conduct outreach to employers and provide the technical assistance neces- sary to help employers establish a functional apprenticeship program.

2. A little public investment goes a long way. Each of the programs profiled in this report has leveraged public dollars to bring in private investment in worker training. For example, while South Carolina’s modest $1,000 employer tax credit does not fully cover the costs of sponsoring an apprentice—especially for the many small companies that may not even have tax liability with the state—it does serve as a vital marketing tool that brings employers to the table. As Apprenticeship Carolina has demonstrated, once employers are at the table, they stay.

3. Industry-recognized credentials add value to apprenticeships in nontraditional occupations. The Center for American Progress recently highlighted the value that industry credentials can bring to an apprenticeship.76 Incorporating industry-recognized credentials into an apprenticeship program ensures that workers who complete their apprenticeship gain a credential that is nation- ally recognized and truly portable. As we discussed above, Vermont HITEC ensured that its medical coding apprentices were also certified as professional coders from the American Academy of Professional Coders. Similarly, participants in the MAT2 apprenticeship program receive a German DIHK-issued certificate that will allow them to work for any German company around the world. Incorporating industry-recognized credentials into training programs strengthens the currency of apprenticeships.

State governments, nonprofits, employer associations, and other entities look- ing to develop strong apprenticeship programs should consider these lessons. By using a strong intermediary, leveraging public investment, and incorporating relevant industry credentials, they can build sustainable pipelines of talent that connect workers to good jobs in fast-growing, high-demand occupations.

Chosen excerpts by Job Market Monitor. Read the whole story at Innovations in Apprenticeship | Center for American Progress.