What is Apprenticeship and How Can it Help Your Business?
Updated: Feb 28
As early as the 14th century, craftsmen and town governments relied on the use of apprenticeship to transfer knowledge of a skilled trade from one generation to the next. As the concept of apprenticeship traveled from Europe to the newly developed American colonies, thousands of apprentices helped build the nation, including Founding Fathers George Washington (surveyor) and Benjamin Franklin (printer).
In 1937, the National Apprenticeship Act, also referred to as the Fitzgerald Act, was established, creating the Registered Apprenticeship Program, which is the current apprenticeship model in place today. Registered Apprenticeship programs—an apprenticeship provides progressive wages, on-the-job training, classroom instruction, mentorship, and industry-recognized credentials—are a sought-after way to propel businesses forward through its investment into a diverse and stable workforce.
When companies adopt Registered Apprenticeship programs into their business models, they develop their future workforce by providing workers with paid training and on-the-job experience, culminating in a highly trained pipeline of highly-skilled employees.
What is a Registered Apprenticeship?
According to Apprenticeship.gov, apprenticeship is an “industry-driven, high-quality career pathway where employers can develop and prepare their future workforce, and individuals can obtain paid work experience, classroom instruction, and a nationally-recognized, portable credential.”
This form of workforce training creates a pathway for workers to obtain sustainable careers in well-established and emerging industries in need of a more diverse and robust workforce.
Some industries with Registered Apprenticeship programs include:
As of 2020, there were 26,000 Registered Apprenticeship Programs across the United States with over 636,000 apprentices currently enrolled, an overall growth of 73% over the course of ten years. This data trajectory suggests that apprenticeship programs are essential to the economic structure of the labor market and immensely benefit both the employee and employer.
Additionally, unlike internships, nonregistered apprenticeship programs, and unpaid workplace training programs, Registered Apprenticeship Programs (RAPs) are distinguishable by five key elements:
A paid job with competitive wages
RAPs can be time-based, competency-based, or a hybrid of both time- and competency-based. A time-based apprenticeship has a structured approach that requires 2,000 hours of on-the-job training per year and 144 hours of related classroom instruction. A competency-based program focuses on the apprentice’s ability to demonstrate skills and job knowledge so that the apprentice can advance through the program based on measured proof of job mastery.
For all individuals who complete a Registered Apprenticeship Program, their combined training and work experience earn them nationally recognized industry credentials, thus demonstrating that they are well-trained and ready for the workforce.
The benefits of a Registered Apprenticeship Program for workers are undeniable. Aside from providing core elements such as progressive wages, education, mentorship, college credits, and credentials, 94% of apprentices who complete an apprenticeship retain employment, with an average annual salary of $70,000.
Additionally, employers can confidently hire from a pool of highly-skilled workers in a specific trade or occupation, which boosts business productivity, profitability, and adds to an employer’s bottom line.
Individuals who are interested in Registered Apprenticeship Programs but who don’t meet the required qualifications can begin their journey by starting in a Work Readiness Training Program, also referred to as Pre-Apprenticeship.
What is a Work Readiness Training Program?
A quality Work Readiness Training program is a workforce development program designed to help prospective candidates meet the entry-level requirements for a Registered Apprenticeship Program. The length of the program varies from a few weeks to a few months and may or may not include wages and stipends. The core goal of a Work Readiness Training program is to help candidates bridge gaps in terms of education by providing supportive services to help them obtain all necessary requirements to enter a Registered Apprenticeship Program.
A Work Readiness Program may assist candidates in the following areas:
Helping individuals obtain a GED
Assisting individuals with obtaining a Driver’s License or State ID
Instruction in academic subjects such as algebra
Basic training regarding commonly used tools
Monetary assistance for food, transportation, or childcare
Hands-on training or volunteering opportunities
Many Work Readiness Programs partner with Registered Apprenticeship Programs to help candidates immediately transfer into an apprenticeship. This is especially helpful for under-represented job seekers (people of color, women, those in underserved communities, and people with disabilities), as it helps them start sustainable careers while earning a progressive wage upfront.
The Value of a Registered Apprenticeship for Employers
Developing a Registered Apprenticeship Program through the Department of Labor is an efficient way to bypass the complicated recruiting process and hire skilled workers with confidence. When an apprentice completes a Registered Apprenticeship Program, they transition out of being an apprentice and enter the workforce. In general, apprenticeship programs bring value to any organization by building a sustainable and skilled workforce of people from all backgrounds, genders, and ages.
Apprenticeship also provides a return on investment for employers as reports from Entrepreneur Media, Inc. show that approximately 73% of apprentices stay long-term with the company that trained them. This successful retention rate helps with company productivity and boosts the bottom line.
Here are a few key benefits employers gain from a Registered Apprenticeship Program:
Reduces Training Costs: Apprentices enter the workforce with years of training and experience.
Customized Training: Employers receive customized training models for specific occupation needs.
Cost Reductions: Crew composition cost reductions allow the employer to have trainees perform client-specific deliverables alongside seasoned workers.
Reduced Turnover Costs: The turnover rate is lower when employers hire highly-trained apprentices who have successfully completed an apprenticeship program, which also helps to lower liability costs.
Uniformity in Training: Standardized training measurements that provide control over the work experience provided.
Increased Revenue: By hiring a worker who is already trained in a skill or occupation, on-site productivity increases, and therefore so does revenue.
Increased Diversity in Workforce: Apprenticeship programs seek to diversify the workforce, which means hiring an apprentice helps ensure more demographics are represented in the labor force.
Tax Credits: Some states offer employer tax credits, employee tuition benefits, equipment costs, stipends, and more. Click here to see the tax credits and tuition benefits breakdown for each state.
Company Investment: Registered Apprenticeship Programs demonstrate a company’s investment in their community and local economy.
Company Culture: Develop a positive culture surrounding the company’s standards and mission statement by investing in top talent
Registered Apprenticeship Programs in Action
As of 2020, there are over 600,000 active apprentices in the United States and 26,000 programs nationwide. Companies such as Hypertherm (Manufacturer), Blue Cross (Health Insurance), and Wells Fargo (Banking Industry) have all addressed their workforce needs by investing in Registered Apprenticeship Programs to train and prepare employees in their respective industries.
In 2005, Hypertherm—a manufacturer of plasma, laser, and waterjet cutting systems— faced a hiring shortage due to interest decline in the manufacturing industry. To compensate for their employee shortage, they needed to increase employment by 50% over four years. To do this, they developed a two-year Registered Apprenticeship Program that required an intensive 9-week classroom learning program followed by hands-on machinery training. Investment into this apprenticeship program training model saves Hypertherm nearly 1.6 million dollars per year.
Similarly, Blue Cross Shield of Southern Carolina registered its apprenticeship program with the Department of Labor in 2009—a move that let them take advantage of the state’s $1,000 tax credit per apprentice. Their goal was to boost talent for their large IT department while recruiting to replace their retiring workforce. The apprentices completed a time-based training program of 16 to 20 weeks of classroom learning followed by 42 to 48 months of full-time on-the-job apprenticeship. The Blue Cross Shield of Southern Carolina successfully lowered attrition to only 4% increased employee tenure to nearly ten years.
Finally, in 2017, Wells Fargo established an initiative to hire more military veterans, veterans with disabilities, and active military personnel. To accomplish this, they launched an apprenticeship program that focused on veterans with the goal of increasing veteran employment to 20,000 by 2020. The apprenticeship program successfully created a hiring trend in the right direction, demonstrating a diverse workforce of team members and leaders.
If you are an individual who wants to join an apprenticeship program, or if you have a business and you want to foster apprenticeship, the following resources are great starting points.
The Office of Apprenticeship by The United States Department of Labor
All About Apprenticeship by Jobs for the Future
Apprenticeship by State by Jobs for the Future
An Employers Guide to Apprenticeship by Intelligent Partnerships
Apprenticeship Pathway to a Sustainable Career by Intelligent Partnerships
Apprenticeship offers a viable resource for individuals looking to earn a living wage in a sustainable career and companies seeking to invest in top-quality, highly-trained employees. To take the next step in your apprenticeship journey, start here: Start an Apprenticeship Program or How to Become an Apprentice.
For more information on Registered Apprenticeship Programs, or if your organization is interested in creating a RAP, please contact Intelligent Partnerships, Inc.