Organizational & Employee Development: The American Apprentice

Apprenticeships in the U.S. are a proven but underused strategy for building a custom-trained workforce.

By Kathryn Tyler Nov 1, 2013
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In 2010, six months before Joshua Barber graduated from high school, he began working as an apprentice for Oberg Industries, a metal-components manufacturer headquartered in Freeport, Pa. Three years later, he has only one more class to complete before he graduates from the apprenticeship program as a qualified precision tool-and-die journey worker.

Oberg Industries’ registered apprenticeship program, which began in 1971, has become central to the company. "Our apprenticeship program is our lifeblood," explains Greg Chambers, director of corporate compliance and safety at Oberg, which employs 750 craftspeople. "We have 15 different journey worker programs. Our most popular are machinists, toolmakers, grinders and press operators. Right now, we have 30 apprentices in the program."

Apprenticeship, a model of instruction that has been in use for hundreds of years, could regain popularity in the United States as high-tech manufacturing operations grow and the cost of a four-year college degree skyrockets.

But for now apprenticeship is an underused training model in the United States, unlike in many European countries, where up to 70 percent of high school students are enrolled in such programs. "For France, Germany, Spain and the U.K., the respective governments are keen to develop apprenticeship," says Danielle Suinot, head of training, skills and learning at Airbus, a 59,000-employee global aircraft manufacturer headquartered in France. "It is a very good way for young graduates to integrate into a new company."

In contrast, U.S. high schools have replaced nearly all practical instruction—wood shop, auto shop, machine shop, sewing, typing, drafting and culinary classes—with college-prep courses, even though more than one-third of high school students do not attend college or university, according to the U.S. Bureau of Labor Statistics.

"The U.S. education system is focused on putting every kid into a four-year college, and that is an incredible disservice," asserts Erick Ajax, co-owner of E.J. Ajax and Sons Inc., a 63-employee manufacturer in Minneapolis. The company’s registered apprenticeship program began in 1993 and provides 8,000 hours of training. Many college graduates, he points out, are grossly underemployed, working in coffee shops and living in mom and dad’s basement with considerable student loan debt.

However, Ajax says, "a European kid who went into a watch-making apprenticeship at Rolex at 15 years old will, at 20, be finished with his apprenticeship, have earned a wage for five years, have five years of experience and will now be ready to go into a career, earning a family-sustaining wage."

How to Set Up a U.S. Apprenticeship Program

“Establishing an apprenticeship program is not difficult,” says Bob Baird, vice president of industry and regulatory affairs at the trade association Independent Electrical Contractors.

A registered apprenticeship is a course of study laid out by a sponsoring company, labor union or community organization. Local community or technical colleges may be partners in the program. U.S. apprenticeship programs need to be registered with and approved by the Department of Labor’s Employment and Training Administration—and sometimes by state governments. Apprenticeships are regulated at the federal level under the National Apprenticeship Act.

“Some people don’t want to deal with government regulations,” Baird says. “But if you look at it, these are things you ought to be doing anyway—tracking employee progress, noting educational achievement, rewarding them for advancement. ... If you’re willing to take a little time to think about your policies, put them down on paper and enforce them consistently, it isn’t that tough.”

Apprenticeships differ in some ways from traditional employee training. “Apprenticeships are a more structured and comprehensive approach to training,” explains Bernadette Oliveira-Rivera, administrator of the Laborers’ International Union of North America training and education fund. “You may get the individual up-to-speed with training, but the individual has nothing meaningful to show for it.” She says a journey worker certificate awarded after an individual completes an apprenticeship program is a transportable credential analogous to a college degree.

U.S. apprenticeships have two components: applied learning (hands-on work) and theoretical learning (often accomplished through classroom instruction). There is usually a minimum of 144 hours per year of classroom instruction but no minimum time for the on-the-job component. Typically, apprenticeships last from two to six years, with four years being the most common.

Upon graduation from the apprenticeship program, apprentices receive certificates from the U.S. Department of Labor. In some cases, they may take an exam and receive credentials from an industry association, such as the National Institute for Metalworking Skills.

Most apprentices are young—straight out of high school or technical college. However, a few older individuals enter apprenticeships. According to the U.S. Department of Labor, in 2012 more than 147,000 individuals nationwide entered into registered apprenticeships and more than 358,000 are currently in apprenticeship programs. There are more than 21,000 registered apprenticeships in the U.S., with the majority of new programs in Iowa, Massachusetts, South Carolina and Virginia.

The Cost Gamble

The costs of apprenticeship to the employer can be significant—typically $170,000 to $250,000 per apprentice for four years of classroom training, medical benefits and a salary on the job while apprentices learn. Employers are not required to pay apprentices for the time they spend in classroom training, although most of them do. Employers may pay for textbooks.

Despite the costs, sponsors generally do not require apprentices to work for them after graduating from the program. Employers trust that the apprentice will like the company and want to stay.

“If you don’t like it here, the last thing we want is for you to be here,” says Greg Chambers, director of corporate compliance and safety at Oberg Industries. “Our turnover rate is less than 5 percent. If you offer apprentices a variety of work, good benefits, and treat them with respect, for the most part, they stay.”

Expanding the Model

While the apprenticeship model is well-suited to many industries, it is most prevalent in manufacturing and construction. But that is changing. “We are seeing more industry sectors exploring apprenticeships, such as transportation and health care,” says Baird, a member of the U.S. Department of Labor’s Advisory Committee on Apprenticeship.

John Ladd, administrator of the apprenticeship program for the Labor Department, says many industries have been slow to embrace the apprenticeship model. “But it is a model for acquiring a highly skilled workforce, for transferring knowledge between generations—something every occupation and industry struggles with.”

Part of the reason some industries may not have adopted it widely is a misconception that apprenticeship is akin to drudgery. “Part of the stigma is people think you’re going to be hot, sweaty and dirty, but that is not the case,” Chambers says. “IT and medical apprentices are 99 percent brain and 1 percent brawn. The stigma of an apprenticeship that you’re going to roll up your sleeves and get hot and dirty can’t be further from the truth.”

Contrasting Models

Why is apprenticeship so common overseas? "In Europe, students are encouraged from an early age to look at all available career options, not simply college," says Bernadette Oliveira-Rivera, administrator of the Laborers’ International Union of North America training and education fund in Promfet Center, Conn. Also, the educational system begins "tracking" students earlier. In Germany, for instance, there are five educational tracks for students—some that lead to apprenticeships—that begin when they turn 11 years old.

Tognum America, a German-American engine manufacturer with North American headquarters in Novi, Mich., is a rare company with U.S. operations that targets students before they graduate from high school. "We have found that most apprenticeship programs in the U.S. are only open to high school graduates and college students," says Joerg Klisch, vice president of operations for North America. "In our opinion, vocational training is more effective if it starts at an earlier age. That’s why our program is focused on high school juniors and seniors."

Public funding also boosts the popularity of apprenticeships in Europe. "There has been a lot more public-sector subsidizing [of] costs of apprenticeship in Europe," says John Ladd, administrator of the Office of Apprenticeship at the U.S. Department of Labor. "Most of the classroom instruction portion is paid for by the government. In the U.S., the full cost of the program is borne by the employer. That can be a challenge."

Apprenticeships in Europe, including white-collar ones, are common across and within industries. Airbus in France offers apprenticeships in procurement, HR, finance, and technical and engineering fields. "There is a lot of diversity in the nature of apprenticeships," Suinot explains. "At the beginning, apprenticeships were dedicated to more handcraft jobs, but this has changed in the last 10 years."

In 2012, Airbus had 1,000 apprentices in France, and it intends to hire more in the next few years. In contrast to most American apprenticeships, apprentices who complete their program in France are not guaranteed a paid position at their sponsoring company. Nevertheless, 82 percent of Airbus apprentice graduates in France are hired by Airbus or its partners.

Benefits for Both

For apprentices, the benefits of such programs include:

Breadth and depth of knowledge. Apprentices are usually cross-trained, and they learn to be flexible. "People who complete apprenticeships know a little bit of everything," says Oberg apprentice Barber.

Henry Spreng, who is two years into a four-year machinist apprenticeship at Oberg, adds that if the work is slow in one area, apprentices have the training and experience to move to other tasks.

Daniel McGee, sales engineer and apprenticeship graduate at E.J. Ajax, says: "I was exposed to every different part of the shop, every part of production, as well as some of the sales and office work that went along with it. The exposure piqued my interest in manufacturing even more than I had originally anticipated."

Within eight months of completing his apprenticeship, McGee became head of sheet metal fabrication, managing 12 people. "I started working with several customers, dealing with their accounts. My job evolved into sheet metal fabrication supervisor and account manager. Then it evolved into my current role as sales engineer," he says.

Minimal costs. Usually, textbooks are the only cost to apprentices for post-high-school training. That’s a much smaller expense than attending college, especially considering that college graduates aren’t guaranteed jobs.

McGee saw that. "My older brother and his friends were struggling to find work after completing four-year university programs," he says. "I realized the importance of on-the-job training experience."

The benefits to employers are more numerous:

Retention and loyalty. Apprenticeships can produce high employee retention and loyalty rates. "A company has an opportunity to secure true loyalty from an apprentice. It’s an opportunity for the young person to grow up inside that company and really become part of that work family," says Robert Shook, training specialist for Chiron America Inc., a custom builder of manufacturing systems with 1,300 employees globally and 89 at its U.S. headquarters in Charlotte, N.C., where a new apprenticeship program began in February 2012.

Apprentice graduates make up 13 percent of Newport News Shipbuilding’s 22,000-employee workforce, says Dan Brookman, training manager for The Apprentice School, which partners with the company. The shipyard designs and builds all U.S. nuclear-powered aircraft carriers in Newport News, Va. The program was established in 1919 and has 800 apprentices in 25 occupations. Eighty percent of the school’s alumni remain employed by the company 10 years after graduation.

Improved morale. Apprenticeship programs can reinvigorate a senior workforce. Apprentices "are excited and want to learn. Everyone wants to share with them and help them grow. It changes the dynamic of the company because everyone wants to be a mentor," Shook says. "It brings a different kind of energy to the floor. Having this opportunity to teach young people has given our technicians an additional purpose."

New talent. Apprenticeships can provide needed talent to companies. "We’re preparing for a mass exodus of Baby Boomers that will be retiring in our business—I refuse to let all of that knowledge walk out the door," Ajax says. "We leverage our master journey workers to transfer the knowledge they have gained over four decades to the younger generation." E.J. Ajax has 13 apprentices and plans to add six more in the next year.

Tognum America was motivated by a training gap its leaders discovered when the company’s South Carolina plant opened in 2010. "As we recruited new employees for the plant, we exhausted the local pool of experienced workers who we had to retrain. We then realized that none of the area’s recent high school graduates had adequate skills," Klisch says. "We see our program as an opportunity to enhance our local labor pool and enhance career opportunities for young people in our community."

Improved safety. "A structured training program teaches people the right, safe way to do things," Ajax says. The company has an exemplary safety record—only one minor injury in 23 years. "Professionals don’t get hurt on the job. Every incident or injury is 100 percent preventable. We instill that in every one of our apprentices," he says.

Credible, customized training.  Because registered apprenticeship programs must have government approval in the U.S., the training gains credibility with students, parents and school counselors. The training also can be unique at each company. "You can have a customized program tailored exactly to the employer’s needs," Ladd says.

"By the time we interview the apprenticeship graduate for a specific job, we’ve already known him for at least two years, so the company and the applicant know exactly what to expect … and we can be confident that the applicant will be effective from day one," Klisch says.

Kathryn Tyler is a freelance writer and former HR generalist and trainer in Wixom, Mich.

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