Coming to America

By: Simon Ashworth

Chief Policy Officer at AELP

Friday 24 November 2017

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President Trump wants 5 million apprenticeships in the USA by 2020. A trailblazer delegation from the UK visited Washington DC in November this year to find out more and here, Simon Ashworth, Chief Policy Officer at AELP, shares his thoughts and findings on the current approach and future plans for apprenticeships in the USA.

I always like to get my thoughts down whilst they are nice and fresh in my mind, so I pen this blog in the back of a taxi on the way from Downtown Washington DC back to Dulles International Airport, before hitting the ‘red-eye’ flight back to Heathrow. Washington is a great city with welcoming people, and I was lucky enough to be on a great delegation party with fifteen senior colleagues from the sector. I’ve not even got back to the UK yet and I’ve already had a plethora of questions about the apprenticeship opportunities in the USA! Is the USA really the ‘land of opportunity’ for providers?

Ok, so down to business. It’s important to point out early on that apprenticeships in the USA are not a new concept. In fact, two of the USA’s best known apprentices were none other than George Washington and Benjamin Franklin. In terms of the USA landscape, there are already around 500,000 apprentices currently on programme across the country. I use the word ‘around’ as the USA has a very different system to the UK of having ‘recognised’ and ‘non-recognised’ apprenticeship programmes. The 500,000 includes all the apprentices on the recognised programmes – no one is able to provide any data on the volume of non-recognised apprentices there really are.

Let’s looks at some key stats:

  • Around 20% of the current 500,000 apprentices are through the US military – the biggest participant in the US system.
  • Around 20% of all the recognised apprentices in the US are employed in construction.
  • The average US apprentice is 27 and male - there is a massive gender imbalance with less than 10% of recognised apprentices in the US being female.
  • There is a near on 50:50 split between the individual states in regards governance by federal (national) or individual state level.
  • Achievement rates hover around the 40% rate.

The numbers relating to further and higher education in the US are simply mind boggling with overall student loan debt currently bulging at $1.3 trillion, which equates to roughly $37,000 per student. Paying huge sums does not even equate to a guarantee of success, with only around 60% of those going to university actually achieving their degree.

The two key drivers which we heard repeated over and over again at the inaugural US Presidential Task Force which we observed, focused on the aforementioned spiralling student debt problem and a widening national economic skills gaps. To quantify that last point, there are currently 6.1m job openings in the USA, and a similar number of unemployed citizens. Unfortunately, quite simply the skills employers require do not correlate with the skills of the unemployed and this gap is expanding rapidly, threatening the very existence of a number of sectors and industries.

One evening I was lucky enough to be sat having dinner with the state senator for Maryland, who is already a huge advocate of apprenticeships in his state.  The senator was keen to discuss the apprenticeship brand which in the US is currently primarily seen by many as a second class route and very much for trade-based occupations. How refreshing it was to hear how the US, having looked at the fabled Swiss and German, are still aspiring to create a model more in line with the system we have in England.  A note to ourselves that maybe we should stop referring to the Swiss and German models and give ourselves some credit for what we have achieved and built in this country.

What really amazed me was the sheer lack of regulation in the USA on apprenticeships which is simply astounding and represents probably one of the most attractive reasons for foreign intermediaries to move into the market. There are downsides though and alas, there is no pot of gold. When you get under the skin of the US system, you realise that there is minimal federal subsidy and although at a state level there are some incentives, it ultimately boils down to effective employer engagement and getting employers to invest in training. Sound familiar? No wonder the National Governors Association and the Department of Labour were so keen to understand how we, in the UK, have managed to engage with employers so effectively and ramp up our own volumes. In some states, it is also highly likely that individual apprentices will end up taking out the equivalent to our own advanced learning loans to pay for their apprenticeship training. The key message is each state is very different in its approach and there is no one size fits all solution. Quite clearly, tackling the US needs to be down at a state level rather than at a national level.

The USA certainly is the ‘land of opportunity’ however, those interested in oversees diversification on the ‘other side of the pond’ clearly need to take a long-term view on such a move. We heard much around the effective collaborative approach to share the risk and leverage local knowledge combined with external foreign expertise. Watch out Uncle Sam, we are coming to get you…

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