Are Apprenticeship Programs Set to Take Off in the U.S.?

By Bill Leonard Jan 30, 2015

Although President Barack Obama made only a brief mention of apprenticeships in his 2015 State of the Union address, proponents believe that these job-based training programs are on the verge of expanding rapidly throughout the United States.

“I’m asking more businesses to follow the lead of companies like CVS and UPS, and offer more educational benefits and paid apprenticeships—opportunities that give workers the chance to earn higher-paying jobs even if they don’t have a higher education,” the president said during his Jan. 20, 2015, address.

While the president’s apprenticeship sound bite didn’t make headlines, the Obama administration clearly is committed to promoting more on-the-job training opportunities. In December 2014, the White House announced that the Department of Labor would administer a new $100 million grant program with the goal of expanding apprenticeship opportunities by promoting partnerships among employers, workers, educators and local governments.

“When you consider the whole grand scheme of the federal budget, a $100 million grant program may not appear to be such a huge commitment,” said Sarah Ayres Steinberg, a policy analyst at the Center for American Progress in Washington, D.C. “But in terms of investments made in workforce skills development, this federal grant program is very significant and could propel apprentice programs in the United States to new heights.”

According to Ayres Steinberg, the number of U.S.-based apprenticeship programs has been increasing steadily in recent years. However, the number of apprenticeships in the U.S. pales in comparison to other developed economies—such as Canada, Germany and the United Kingdom. For example, newly registered apprentices in the U.K., a country with a population approximately one-fifth of the United States, outnumbered their U.S. counterparts by nearly five to one during 2014.

“The U.K. has seen a huge expansion in apprenticeships over the past few years,” said Ayres Steinberg. “Apprenticeship programs in the U.K. are promoted as a cost-effective and viable alternative to university-based education. The U.K. apprenticeship initiative is a model that we in the United States should consider following.”

Ayres Steinberg and her colleagues at the Center for American Progress have researched and published several studies on apprenticeships. Their latest report was released in September 2014 and focused on recent innovations in apprentice programs. The report highlights states such as South Carolina where, since 2007, nearly 10,500 workers have participated in the state’s Apprenticeship Carolina program.

“South Carolina faced a significant skills shortage with major manufacturers like BMW and Boeing opening large assembly plants there,” said Ayres Steinberg. “So the state partnered with these and other employers to develop and provide new apprenticeship opportunities through the state’s technical and community college system. It has been a huge success.”

Even with success stories like Apprenticeship Carolina, U.S. businesses still remain reluctant to embrace apprenticeships as a job-training option.

“The biggest thing is getting employers to the table and interested in investing in apprenticeships,” said Ayres Steinberg.

She added that the reasons many employers hesitate to commit to these programs include initial investment costs and a general misperception that apprentice programs are part and parcel of unions and collective bargaining agreements.

To address these issues, local, state and federal agencies are helping to ease the initial sticker shock for employers by providing grants and tax incentives. And anyone who links apprentice programs to labor unions is making a false assumption, according to Ayres Steinberg.

“People hear ‘apprentice,’ and often they automatically think of labor unions, which isn’t true at all,” Ayres Steinberg said. “Still, it can be the up-front price tag and time commitment to apprenticeship programs that causes many employers to balk, but that is changing too.”

Depending on the job and complexity of the work, it can take up to five years for an apprentice to complete the training program and master the job skills they need. However, the payoff can be huge for both employer and employee.

“As the cost of attending four years of college continues to escalate, apprenticeship programs are becoming a much more attractive alternative to students who don’t want to graduate with $100,000 in student loan debt,” said Ayres Steinberg.

Interest in apprenticeships among college graduates and job applicants with some level of college education is definitely increasing, according to Daniel Brookman, manager of training at The Newport News Shipbuilding’s Apprentice School. He told SHRM Online that 10-15 years ago most of the participants in his employer’s apprenticeship program were high school graduates.

“Now, I’d say that 60-65 percent of the participants either have four-year degrees or two or three years of college,” he said.

The skills training that participants in apprentice programs now receive goes beyond trade jobs that have typically been associated with apprenticeships, such as plumbers, welders, electricians and pipefitters. The number of apprenticeships in fields like information technology and health care has increased as the demand for skilled software developers, systems administrators and lab technicians has skyrocketed in recent years.

“Because of this demand for more skilled workers, a growing number of companies are now looking at apprenticeship options,” said Brookman. “I believe that apprenticeships will continue to increase in the United States, but it’s going to require some guarantees of investments from employers and some legislation at the state and federal levels that support these programs.”

Apprenticeships have been a part of the training and development initiative at Brookman’s employer since 1919. He said that investments in the program made good business sense and that the program was born out of necessity.

“We offer apprenticeships at Newport News Shipbuilding because we need skilled workers,” he said. “The labor pool here does not typically possess the skills that we need. So we simply can’t hire someone right out of high school and put them to work immediately. It just doesn’t work that way.”

Employers throughout the United States are finding themselves in a similar situation as demand for skilled labor continues to increase, while the number of students graduating from colleges and technical schools has held relatively steady, and in some fields has actually decreased.

“Competition for talent is definitely very tight, so one of the best alternatives is to grow your own talent,” said Bill Docalovich, director, trades services at Huntington Ingalls Industries, a division of Newport News Shipbuilding.

Improved employee loyalty and engagement are additional advantages to cultivating talent within your own organizations, according to Docalovich and Ayres Steinberg.

“Employees who went through our apprentice program are the most loyal to our company,” Docalovich said. “They also tend to be the most engaged and most productive.”

Research backs up Docalovich’s claims, according to Ayres Steinberg. She added that one study conducted by her organization found that apprenticeships significantly boost the productivity, engagement and retention among program participants.

“So, the investments that employers make into apprenticeships should definitely pay off in the long run,” she concluded.

Bill Leonard is a senior writer for SHRM.

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