New studies outline advantages of using apprenticeships to train workers

Apprenticeships lead to higher long-term earning for those who participate—but participation is relatively low, according to a new study by the Urban Institute and Abt Associates.

In the U.S., apprenticeships have been used since the 1930s—but mostly in the construction trades. The new report, released in conjunction with National Apprenticeship Week, noted that employers can use apprenticeships to find and retain workers in the current tight labor market.

According to a separate report by Thomas Fordham Institute, since the founding of the National Apprenticeship Act in 1937, about half of the states in the U.S. have official apprenticeship programs, with 27,000 registered programs enrolling around 500,000 individuals.

Apprenticeship workers see higher earnings

The Urban Institute report found that earnings increase for all apprentices between the year before they begin an apprenticeship program and the year following its conclusion, regardless of industry.

“Earnings gains among people traditionally underrepresented in apprenticeships outpaced those of traditional apprentices in the building trades,” the report said. “Earnings for all apprentices increased 49%, 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.”

The report added that the increase in apprentices’ earnings outpaced those of comparable workers—or workers of the same sex, race, ethnicity, age, education level, and state of residence—whose earnings grew by 16% during a similar period.

Gains in earnings for those in apprenticeship programs were higher for workers in the manufacturing, health care, and IT industries than for those in traditional construction-related jobs, the Urban Institute study found.

Still, some persistent barriers made differences for workers even in the same occupation areas. “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,” the report said.

Apprenticeships are popular, but not as common as in other countries

The Fordham report quoted a survey by Populace that found that 92% of Americans view apprenticeships favorably, while 62% say they make people more employable than going to college. In addition, more than 9 in 10 (94%) agreed that apprenticeships help individuals obtain new careers.

The Fordham study also found that The U.S. lags behind many nations in using apprenticeships for workforce preparation. “Around 70% of U.S. registered programs are in construction trades, such as carpentry and plumbing,” the report said. “This is unlike other English-speaking nations like Australia and the United Kingdom where most government-supported apprenticeships are in fields like health care, logistics, technology, and the financial sector.”

Related: From Zoom classes to the workforce: Analyzing pandemic-era graduates’ professional skill sets

There are federal and state programs that businesses can turn to for more information on apprenticeships: there are Department of Labor grant programs on the federal level, as well as the American Apprenticeship Initiative and Apprenticeship Building America, both of which work to increase registered apprenticeships, including in non-construction industries. The Urban Institute report also noted state efforts, such as in California, where Governor Gavin Newsom set a goal of reaching 500,000 active apprentices by 2029.

The two studies suggest that there are opportunities for businesses to take a new look at apprenticeships as way to gain loyal workers and address inequities that other training and education systems have struggled with.

“Apprenticeship is one of the best kept secrets among workforce training models,” said Karen Gardiner, senior fellow at the Urban Institute. “With positive benefits for workers and for employers, it can be used in any occupational sector, and for workers at any stage of their careers.”