Republican and Democratic leaders have long agreed on the goals of expanding economic opportunity and upward mobility and of rapid economic growth. Now, both sides are finding common ground on one of the best means to achieving these goals—expanding apprenticeships.
This week, Senators Cory Booker (D-New Jersey) and Tim Scott (R-South Carolina) introduced a bill to provide tax credits to employers who start apprenticeship programs or who increase the number of apprentices beyond 80 percent of their recent levels. The Leveraging and Energizing America’s Apprenticeship Programs (LEAP) Act would offer tax credits of $1,000 to $1,500 a year per apprentice for up to two years.
The LEAP Act reinforces the bipartisan interest in supporting apprenticeship. A few months ago, the Obama Administration announced $100 million in competitive grants for states and other organizations to expand apprenticeship slots. It also proposed a new allocation of $2 billion over 10 years for apprenticeship. Republican governors Scott Walker of Wisconsin and Nikki Haley of South Carolina are enhancing state efforts to increase the take-up of apprenticeship.
Expanding apprenticeship offers a long-term, evidence-based strategy that increases productivity by increasing skills at very modest cost to the government. Apprenticeships combine serious work-based learning and classroom instruction usually lasting two to four years, aimed at mastering occupational and employability skills, and leading to a recognized credential.
Apprentices are employees who participate in the production process and earn a wage. They earn while they learn, contribute to production while gaining the skills to master an occupation, and transition easily into careers. The “learning by doing” and mentoring components embedded in apprenticeship increase the motivation of participating young people and improve both occupational skills and such employability skills as responsibility, teamwork, and communication.
Apprenticeships encourage firms to enhance the skills used in their organizations. Research studies have documented that workers, employers, and the government can all gain from a robust apprenticeship system.
Although the LEAP subsidies to expand apprenticeships are modest, LEAP is on the right track. It recognizes that the primary constraint to attaining a high level of apprenticeship training in the United States is stimulating large numbers of employers to offer apprenticeships. If we build it, people will come. Most if not all apprenticeship programs have far more applicants than openings.
The LEAP subsidies can play a significant role in increasing apprenticeship offers, but probably only if they are combined with funding for effective marketing of apprenticeships to individual employers. Using a combination of tax credits, state branding, and marketing to individual employers, South Carolina’s Apprenticeship Carolina program managed to generate a six-fold jump in the number of companies offering apprenticeships.
With national branding and marketing by Further Education colleges and by private training organizations, England achieved a dramatic increase in company offers of apprenticeship in a wide array of occupations. The 800,000 apprentices make up about 2.9 percent of England’s workforce. For the United States to reach the same scale would mean over 4 million apprentices, or about 10 times today’s level. With public spending of about $2.3 billion per year, England moved apprenticeship into the mainstream and leveraged billions of dollars in private investments in training.
The LEAP subsidies to employers are less than half of England’s government investments per apprentice. But they are a good start to an effective bipartisan strategy to reskill America’s workforce.