What the United States Can Learn from Scotland’s Apprenticeship Expansion
This week, more than 1,000 Scottish companies will participate in Scottish Apprenticeship Week 2014, highlighting the success of the country’s recent efforts to dramatically increase apprenticeships. As U.S. policymakers set out to double the number of apprenticeships in America over the next five years, Scotland serves as an example of a country that has done just that.
As detailed in a recent Center for American Progress report, “Training for Success: A Policy to Expand Apprenticeships in the United States,” apprenticeships help businesses meet the demand for skilled workers while offering workers higher wages and better employment outcomes. In particular, apprenticeships can benefit Millennials, who face disproportionately high unemployment rates, low-wage jobs, rising college costs, and spiraling student debt.
These were some of the considerations that Scottish lawmakers took into account when they set out in 2008 and 2009 to expand the Modern Apprenticeship programme initially developed in the 1990s. They set a goal of 25,000 new apprentices annually starting in 2011, expanded the types of apprenticeships available, launched a nationwide marketing campaign, created new financial incentives, and introduced new government apprenticeships.
As a result, Scotland has more than doubled its number of apprenticeship starts, while also increasing the gender and occupational diversity of apprenticeship opportunities. In fact, Scotland’s apprenticeship program now dwarfs that of the United States, with more than nine times as many people per capita starting apprenticeship programs in Scotland than in the United States.
Consider that Scotland started 25,700 new apprentices in the 2012–2013 financial year—up from 10,600 in the 2008–2009 financial year. If the United States had an equivalent number of apprentices in the population, we would see more than 1.5 million workers start apprenticeship programs every year. Instead, the U.S. Department of Labor’s Office of Apprenticeship registered just 164,000 new apprentices in 2013.
While the bulk of U.S. apprenticeships are in the skilled trades, Scottish apprentices choose from 70 different types of modern apprenticeships that encompass a range of occupations, including accounting, information technology, hospitality, and engineering. Hospitality and tourism, retail, and customer service are the two most popular occupational groupings for new apprentices, after construction. Companies as diverse as IBM, HSBC, and GE Oil & Gas Internationalsponsor large apprenticeship programs in Scotland. While fewer than 10 percent of U.S. apprentices are women, the number of women starting apprenticeships in Scotland has increased nearly fourfold since the 2008–2009 financial year. Women now make up 43 percent of all new Scottish apprentices.
Modern apprenticeships in Scotland offer substantial benefits to both workers and the businesses that sponsor them. A survey of former apprentices in 2012 found that six months after completing their apprenticeship, 92 percent were employed; 70 percent of these workers were still with their apprenticeship employer. Those who completed their apprenticeships—about 80 percent of those who started a program—expressed high levels of satisfaction with their experiences, with 93 percent indicating that they were “satisfied” or “very satisfied.” Two-thirds reported that their apprenticeship led them to earn a promotion, to make more money, or to take on a job with more responsibilities. Apprenticeship completers also noted that their skills had improved, their confidence had increased, and they had a clearer idea about what they want to do in life—all as a result of completing a modern apprenticeship.
Crucially, most of the benefits of Scotland’s apprenticeship expansion have gone to the youngest workers. Seventy-eight percent of new apprentices in the 2012–2013 financial year were under age 25, with 52 percent of them ages 16 to 19. For comparison, only about one in five U.S. apprentices is under age 25, and the average age is 29. Increasing the number of young people in apprenticeships is important both because young workers face the highest rates of unemployment and because the benefits of an apprenticeship—to workers, employers, and taxpayers—are maximized for younger workers.
Sponsoring apprentices helps Scottish businesses build a pipeline of skilled workers, improve productivity, and boost their bottom lines. A survey of employers found that 96 percent reported that modern apprenticeship completers were better able to do their jobs, and 75 percent viewed modern apprentices as either important or vital to their businesses. Companies have found that apprentices improve their operations: 68 percent of employers reported improved productivity, 67 percent reported improved product or service quality, and 66 percent reported improved staff morale as a result of offering modern apprenticeships.
Last month, Scotland’s government announced that after three years of exceeding its target of 25,000 new modern apprenticeship starts each year, it is going to raise its target each year until there are 20 percent more new placements by 2020. These new apprenticeships will specifically target highly skilled jobs. Given the success of apprenticeship programs in getting well-trained workers into good-paying, middle-class jobs, it’s easy to see why both the business community and the government in Scotland have embraced these high-performing programs. With the United States currently facing high levels of youth unemployment and underemployment, now is a good time to emulate successful models where we can find them.
Sarah Ayres is a Policy Analyst on the Economic Policy team at the Center for American Progress. Jennifer Erickson is the Director of Competitiveness and Economic Growth at the Center.
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Director, Competitiveness and Economic Growth