We know that registered apprenticeships pay off for both workers and employers. But currently, only a small portion of employers and workers participate in the apprenticeship system.
Evidence shows that larger organizations are more likely to offer apprenticeships than businesses with fewer than 500 employees. Yet smaller employers experience greater return on investment from civilian apprenticeship programs compared to larger employers.
Here we summarize lessons learned from the Small and Medium Business Tech Apprenticeship project. We explore how governments and intermediaries can help support small and medium-sized businesses (SMBs) participate in the registered apprenticeship system and outline best practices for SMBs to successfully launch and sustain a program.
How governments can help small and medium-sized businesses launch apprenticeship programs
Since 2015, government leaders at the federal and state level have invested more than $1 billion in grants and tax credit programs to expand apprenticeship programs to new populations, geographies, and sectors.
To help more SMBs launch and sustain apprenticeship programs, governments can provide more targeted investments, including:
Offset apprenticeship program costs.
Launching and running an apprenticeship program can be a heavy lift for any employer, but the costs can be particularly difficult for SMBs to cover. To address these cost barriers and incentivize SMBs to invest in the apprenticeship model long term, we recommend governments target discretionary grant programs and tax credit programs based on employer size.
Grant programs can be a powerful short-term tool to help SMBs engage with the registered apprenticeship system—their simple design allows cash incentives and subsidies to flow directly to employers. The responsibility of disbursing grant assistance rests with government staff and their partners, which can also lower barriers to uptake.
Tax credits can help SMBs sustain and grow their investments in registered apprenticeship programs over time because they provide predictable support.
Provide technical assistance to SMBs.
Many employers don’t have the administrative capacity and expertise to navigate the requirements of launching and managing apprenticeship programs. This is especially true for SMBs because of their limited size and resources.
State and federal apprenticeship agencies can help SMB employers understand and adopt apprenticeship programs through dedicated apprenticeship support staff, often called apprenticeship training representatives (ATRs). ATRs can educate employers about the apprenticeship system, oversee and mobilize grant resources, and help employers successfully navigate regulations and the administrative process of developing, registering, and launching an apprenticeship program.
To help make sure SMBs don’t get left out of the apprenticeship system, it is critical for government providers and intermediaries to target assistance to SMBs specifically. Governments can do this by creating goals for newly registered SMB apprenticeships or by assigning staff to focus on engaging with SMB employers.
How intermediaries can help small and medium-sized businesses adopt apprenticeship programs
Intermediaries, such as chambers of commerce, industry associations, nonprofits, unions, training providers, colleges, and universities, can take on a wide range of roles to support the development of new apprenticeship programs. These organizations have the expertise and resources SMBs need to understand and successfully participate in the registered apprenticeship system.
Here are three ways intermediaries can help SMBs launch and sustain apprenticeship programs:
Expand the capacity of registration agencies.
Though state and federal registration agencies help employers navigate the registration process, these agency teams are often limited in size and don’t have the resources needed to serve all prospective employers and sponsors. Intermediaries can expand the capacity of agency staff and help provide support to SMBs by helping them navigate the registration process and connecting them with education partners and funding opportunities.
Serve as program sponsors.
Intermediaries can also support SMBs by taking on administrative responsibilities and serving as apprenticeship program sponsors. This approach works particularly well when SMBs are interested in leveraging apprenticeships as a talent development strategy but can only hire a small number of apprentices or don’t have the time and resources needed to design, launch, and manage a program on their own.
Help build strategic partnerships.
As experts in their respective workforce ecosystems, intermediaries are well positioned to connect education, workforce, and industry stakeholders and help ensure program quality and sustainability. This support can be especially helpful for SMBs that may have less time to cultivate partnerships.
Intermediaries can serve as trusted advisors, connecting employers with education and nonprofit partners to recruit apprentices and meet registered apprenticeships’ instruction requirements. They can also help employers identify and access available funding to offset program costs or supportive services for apprentices.
How a small and medium-sized business can start or join an apprenticeship program
SMBs interested in apprenticeship programs have two ways to get started:
- create your own program, or
- join a group program sponsored by an intermediary.
In the table below, we explore tradeoffs and key considerations for each pathway.
How small and medium-sized businesses can recruit and retain apprentices
Attracting apprentices is a crucial component of any apprenticeship program. But SMBs often have limited resources to lead conduct hiring searches or market job opportunities.
Based on our work with 15 SMB employers in North Carolina and South Carolina, here are four ways SMBs can recruit a diverse talent pipeline in the tech sector:
- Build strategic education and community partnerships to expand awareness of tech career opportunities to underrepresented talent.
- Support applicant readiness through short-term training programs that build tech skills.
- Use intentional screening methods that mitigate bias and promote equity.
- Improve representation across all levels of the organization to reflect the communities they serve.
Retaining apprentices as workers is a key way for SMBs to get a return on their investment in apprenticeship programs.
In our work, we found that supervisor–apprentice and mentor–apprentice relationships were critical to the success of apprentices and whether or not they complete their training. When a program had a smaller cohort of apprentices, supervisors and mentors had more capacity to provide individual attention and support.
To achieve positive retention outcomes, we recommend four key strategies:
- Provide higher compensation to apprentices when and where possible.
- Accommodate program and schedule flexibility.
- Foster a sense of belonging and inclusion in the workplace.
- Leverage SMB resources to enhance core elements of the apprenticeship.
