The blog of the Urban Institute
February 10, 2021

It’s Time to Modernize the American Apprenticeship System

February 10, 2021

Achieving a healthy future of work requires employees to build skills that help them attain productive and rewarding careers. One of the most cost-effective ways to do this is through apprenticeship, which helps workers master occupations and gain professional identity and pride.

Despite some increases, the apprenticeship rate in the US remains well behind rates in many other countries. Strengthening apprenticeship at scale would widen opportunity for a large segment of workers but will require policies that reshape incentives, funding, skill standards, assessments, and methods used to attract employers and establish apprenticeships.

It would also require mindset shifts about apprenticeships. Employers would need to understand apprenticeships are a viable and cost-effective talent development strategy that can be quickly implemented to serve current and future workforce needs. Workers would need to view apprenticeships as opportunities to aspire to, not resort to. And governments and the public would need to understand apprenticeship can be a mainstream path to learning and desirable careers—a path that is highly cost-effective for workers and can involve college credit and degrees.

The existing apprenticeship model is limiting

Aided by increased funding from two presidents and Congress, the current registered apprenticeship system has expanded the model in fields such as health care and information technology. But the existing system’s structural weaknesses are likely limiting the scale of apprenticeship well below its potential to change lives and strengthen the economy.

The only federal law guiding the US apprenticeship system dates back to 1937, when the primary goal was to protect apprentices from safety and exploitation. Since then, regulations (PDF) have attempted to modernize parts of the system. In 2018, then-president Trump’s Task Force on Apprenticeship Expansion proposed a plan for Industry-Recognized Apprenticeship Programs. The move in the House of Representatives to pass the National Apprenticeship Act of 2021 illustrates bipartisan support for apprenticeship. The bill proposes added funding for apprenticeship but mainly codifies existing practice and does not resolve structural problems nor point the way toward a modern apprenticeship system.

How can the US generate scale without sacrificing quality?

Building a quality US apprenticeship system that can ultimately train 25 to 30 percent of workers would require Congress and the new administration to take several steps.

  1. Develop recognized occupational frameworks to ease employer participation. An employer interested in using apprenticeship to ensure the availability of a skilled welder, accountant, or information technology specialist should be able to draw on well-developed skill frameworks for each occupation. These would specify what the apprentice is expected to learn and how much of that education will take place at the worksite and in classes (online or in person). A public-private entity or set of entities could work with employer groups and education and training organizations to oversee the development of the frameworks and ensure they keep pace with changing skill requirements. Once approved, employers agreeing to hire and train apprentices using the frameworks would automatically gain recognition in the formal apprenticeship system and qualify for public funding. The employer could simply register by sending a form to the government just as one registers a computer or other product. The frameworks should incorporate employability skills, such as reliability, teamwork, and problem solving, as well as academic and occupational skills. To avoid frameworks that are too narrow for mobility, the frameworks should be limited to no more than 500–600 occupations. The entity can draw on examples developed by the Urban Institute and by the United Kingdom’s Institute for Apprenticeship. The cost of such a system would be about $10 million per year.
  2. Formalize the role intermediaries play in developing apprenticeship programs and working with employers. Organizing apprenticeships requires determining the most suitable occupations, developing a plan to combine work-based and academic instruction, and helping register the apprenticeships. Intermediaries with expertise in apprenticeships can play a crucial role in helping employers develop and organize their apprenticeship programs. The federal government could establish performance-based incentives for intermediaries (private or public) to work with employers and pay intermediaries only for new apprenticeships they create using official occupational frameworks.
  3. Fund off-the-job learning opportunities for apprentices using official skill frameworks. Apprenticeships combine the on-the-job learning with theoretical instruction off the job. The government could directly finance most of theoretical instruction related to the occupation for employers that hire and train apprentices. Alternatively, it could make it easy for employers and apprentices to access existing state and federal dollars currently allocated to traditional education and training programs, such as Pell grants, veterans’ benefits, and other training funds. This would require widening eligibility for these programs. If 20 percent of students were to use Pell grants for apprenticeships, support for off-job learning would amount to nearly $6 billion for 1.4 million apprentices.  
  4. Enlist high schools, including career academies and career and technical education programs, to sponsor apprenticeships for local employers. Starting apprenticeships in late high school has many advantages and is one reason countries like Germany and Switzerland engage 50 to 70 percent of their young people in apprenticeships. High schools and many dual-credit programs that allow high school students to take community college courses are already financed by government, thus providing the academic component of apprenticeships at little or no cost to employers or other government programs.
  5. Strengthen independent auditing to assure program quality and to avoid fraud, thus increasing the credibility of the apprenticeship system. We can learn from oversight systems operating in Australia, the United Kingdom, Germany, and other countries.
  6. Create apprenticeship positions with federal, state, and local governments.  Expanding apprenticeships to the public sector for occupations such as information technology, accounting, health care, administration of parks and courts, and security (including police and fire departments), would help bolster governments’ leadership and creativity.

Over time, a modernized apprenticeship system would add data collection to track apprentices’ earnings and enhance counseling and mentorship services, third-party assessments of individual apprentices, and ongoing research. But these initial six steps build the foundation for an American apprenticeship system that could expand access to apprenticeships, improve the lives of millions of Americans, and increase the productivity of the economy.

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