Apprenticeships May Cure What Ails the US Labor Market — at a Price

President Trump, like President Obama before him, is touting apprenticeships as a way to revitalize the American labor force. There are good reasons for enthusiasm about this approach and some significant areas for caution. It’s also important to consider apprenticeships as simply part of a broader range of labor market reforms.

Apprenticeships generally involve partnerships between employers and educational institutions. Participants study to gain skills and academic credentials. They also work at paid jobs (not unpaid internships) where their mentors train them for immediately usable skills. President Trump referred to the idea as “earn while you learn.”

According to the Labor Department, around 90 percent of those completing apprenticeship programs receive job offers when they complete their programs, with average starting salaries around $60,000. Plus, they arrive at that point without accumulating the crushing debts their college-bound contemporaries often accumulate. The federal government plays an oversight role — enforcing the contractual relationships between schools, employers and apprentices. 

The specifics of how the Trump administration will promote apprenticeships remain to be seen, but the broad themes appear to be more federal grants to support the programs, less federal oversight over (interference with?) the programs and greater reliance on non-college sources of educational services (private companies, for example).

Probably the best argument for apprenticeships is that they provide something of a check on today’s problematic relationship between higher education and workforce requirements. Vast numbers of American students emerge from colleges and universities with enormous debts (over $1 trillion in the aggregate) and wide gaps in the skills employers are seeking.

Aside from damping economic growth, this mismatch of employers’ needs and applicants’ abilities generates serious social problems — marriage, children and home ownership feel out of reach for many graduates. With an apprenticeship, an actual non-academic employer assures throughout the process that the apprentice acquires useful, marketable skills. The employer/mentor spends good money to shepherd the apprentice through the process. 

But some caution is in order. Apprenticeship enthusiasts often point to the large numbers of European students who use this path to reach gainful employment. But European workers often lack the job mobility that Americans enjoy and expect (particularly upward mobility). Also, apprenticeship programs often involve early career tracking of students.

Students may be asked to choose careers while still in high school, rather than the more freeform choices and zigzag career paths Americans are accustomed to. This raises the possibility of discrimination and stereotyping. What's more, experience in some countries suggests that if not managed correctly, the training in apprenticeship programs can become antiquated and even a tool to hold back newcomers. 

While a near-certain job offer at a decent salary is a positive feature of an apprenticeship, there is also the question of whether the lack of a more general education will leave workers stranded when smart machines and other economic developments render existing job skills obsolete. Universities have long argued that a broad liberal education best prepares individuals for multiple careers. Whether colleges actually provide students with flexible skill sets is open to question, but the principle has merit.

Traditionally, America’s penchant for second chances and serial career changes have been an engine of innovation. It’s important to consider whether apprenticeships will stifle those tendencies. On the flip side, there is truth in the words of Ivanka Trump, who is spearheading the apprenticeship effort for her father: "There has been great focus on four-year higher education, and in reality, that is not the right path for everyone." There is certainly truth in that statement.

The real challenge in coming years may be more about maintaining employability rather than about getting into that first position. How do you stay employed when robots, trade and other factors obliterate the need for previously valuable skills sets? The current discussion includes some ideas for extending apprenticeships to mid-career workers.

But maintaining viability probably means shedding some of the labor laws that were crafted for a 20th-century economy (or earlier). Should full employee benefits come only to those who work 40 hours a week or more, for example? It may be easier for a worker to retool her schools if, for example, she can cut back to 25 or 30 hours of work a week and devote the additional hours to re-training. Building in the flexibility to adapt will require more than an apprenticeship at the start of one’s career.