Apprenticeships lead to long-term earnings increases that outpace those of similar workers, according to a study by the Urban Institute and Abt Associates. Yet apprenticeships remain one of the best kept secrets in the US.
Despite the apprenticeship system existing since the 1930s, apprenticeships haven’t expanded beyond the construction trades until relatively recently (PDF). They also get lost in the debate about the relative value of different postsecondary education and training options for helping workers attain good jobs, including two- and four-year college degrees, sectoral training programs that result in certificates and degrees, and other types of credential-based programs.
However, registered apprenticeship is the premier “earn and learn” model (PDF); by combining technical instruction in a classroom with learning and mentoring experiences at a worksite, apprentices earn increasingly higher wages both during their time in the apprenticeship and after they’ve acquired the necessary competencies for a job and the apprenticeship concludes.
The start of National Apprenticeship Week is the perfect time to shine a light on the earnings increases associated with registered apprenticeships in the hopes that it encourages more employers to use apprenticeship to find and retain workers and encourages workers at all levels to pursue apprenticeships.
Registered apprenticeships boost earnings
The recent evaluation of the US Department of Labor’s (DOL’s) American Apprenticeship Initiative by Abt Associates and Urban revealed that earnings increased for all apprentices between the year before their apprenticeship began and the year following its conclusion, regardless of their occupational sector and demographics.
In fact, earnings gains among people traditionally underrepresented in apprenticeships outpaced those of traditional apprentices in the building trades. Earnings for all apprentices increased 49 percent, but earnings gains were higher for women apprentices, Hispanic apprentices, and apprentices of a race other than Black or white. Earnings for white and Black apprentices and men apprentices also increased but at a below average level.
In addition, apprentices’ earnings increases outpaced those of comparable workers—or workers of the same sex, race, ethnicity, age, education level, and state of residence—whose earnings grew by just 16 percent during a similar period.
Multiple factors affect earnings increases, including occupational sector, apprenticeship occupation, incumbency, and demographics. New workers experienced much larger earnings gains than incumbent workers, reflecting new workers’ lower preapprenticeship earnings and higher postapprenticeship earnings. Manufacturing, health care, and IT apprentices saw higher earnings increases than apprentices in traditional construction-related occupations.
Even within occupations, though, earnings trajectories differed. The difference in earnings gains between white and Black apprentices is largely attributable to apprenticeship occupation; a larger share of Black women participated in shorter-term, lower-paying health care apprenticeships, such as pharmacy technician, but a larger share of white women participated in longer-term, higher-paying apprenticeships, such as registered nursing.
These findings have some limitations: they reflect outcomes for apprentices and not the impacts of programs, meaning earnings increases can’t be attributed solely to apprenticeships. Also, our findings exclude apprentices in unregistered programs and apprentices in longer programs (primarily construction). Lastly, we examined outcomes by sex, race, ethnicity, and occupation, but we can’t disentangle any one characteristic’s influence on outcomes because some of these characteristics are correlated. Still, the evaluation findings suggest apprenticeship is a promising workforce training model for in-demand, good jobs.
Better communicating earnings outcomes could increase registered apprenticeships across the US
Recognizing the value of registered apprenticeships, both the federal government and state governments provide funding for them: DOL grant programs, including the American Apprenticeship Initiative and Apprenticeship Building America, aim to increase registered apprenticeship across the country, including in nonconstruction occupations. They also aim to diversify apprentices. At the state level, California Governor Gavin Newsom set a goal of reaching 500,000 active apprentices by 2029.
To achieve these goals and make the most of government investment, policymakers and workforce development professionals, such as American Job Centers staff and high school counselors, could better promote the earnings gains associated with registered apprenticeships. Doing so could lead more workers and employers to consider apprenticeships as a training option and help more people obtain high-quality jobs.