Now that the historic American Rescue Plan has been passed in Congress and signed into law, President Biden will turn to his Build Back Better plan to help the more than 10 million unemployed Americans return to the labor force. As part of this effort to lift the job prospects of laid-off workers and young Americans without college degrees, America needs to go big on investing in a modern apprenticeship system built for the needs of our 21st century workforce.
More than ever before, Americans – especially young adults – need pathways to careers that don’t require a traditional four-year college degree. While Millennials are the most educated generation in history, as of 2015, only about a third of Americans ages 25-to-34 were college graduates. That number is even lower for older Americans. Apprenticeships offer an on-ramp to well-paying careers for those who did not go to college. The average starting annual salary for registered apprentices is $60,000.
Even though most Americans don’t go to college, the U.S. has historically underutilized apprenticeships compared to European countries. European apprenticeships span a range of industries, including those on the cutting edge. For example, German biotechnology company BioNTech, which partnered with Pfizer on a COVID-19 vaccine, hires and trains large numbers of apprentices as part of its business model.
To bridge this gap, we need to increase apprenticeships in the U.S. 10-fold. Currently, there are only about 440,000 registered apprentices in the U.S., and often, in states where apprenticeships are available, there are too few slots in programs to meet demand. If the United States were to create as many apprenticeships as a share of our labor force as European countries do, that number would be nearly 10 times higher.
While on the campaign trail last year, Biden recognized the need for a boost to workforce development by including a $50 billion investment, including for apprenticeships, in his Build Back Better agenda. Now that Democrats have control of Congress and the White House, the administration should push policymakers to prioritize an overhaul of our underfunded and outdated apprenticeship system through a revamped National Apprenticeship Act (NAA), essential legislation that is estimated to create nearly one million high-quality apprenticeship opportunities. The new NAA is being spearheaded by Rep. Bobby Scott (D-Va.) and a bipartisan coalition in the House and includes provisions that wisely prioritize opportunities for key groups, such as young adults, childcare workers and veterans. It also aims to increase apprenticeships in industries that do not require a four-year degree for well-paid jobs, such as health care, information technology and financial services.
Next, the White House and Congress should go even further to modernize the current apprenticeship system. First, they could formalize and incentivize intermediaries (public or private) by subsidizing them to create “outsourced” apprenticeships. The intermediaries would be compensated for each placement of a candidate who meets certain criteria (such as eligibility for Pell grants), when the candidate is provided with an apprenticeship that: (1) pays minimum wage or better; (2) trains them with a marketable, relevant skill; and (3) leads to a permanent position in that industry.
Policymakers should also promote building relationships with high schools to set up apprenticeships and career and technical education programs that begin in the 11th or 12th grade and pair students with local employers. Similar programs have shown promise in other high-income countries that employ a high percentage of their younger workers through apprenticeships.
Our current apprenticeship system also needs to be modernized to be more equitable and inclusive. In 2019, 88 percent of new apprentices in registered apprenticeship programs were male. One avenue could be to increase apprenticeship programs in industries dominated by women that face worker shortages. For example, Colorado created a workforce pipeline of apprentices in early childhood education and care.
Finally, we need to create public service apprenticeship opportunities and programs at all levels of government, including in industries such as information technology, accounting and health care.
Once President Biden turns to his Build Back Better agenda, we hope that he acknowledges that millions of Americans who are currently unemployed lack a college degree. For them, we should turn to a centuries-old, evidence-based model that raises employee wages while providing employers with the workers they most need. America’s investment in alternate pathways to jobs, including investments in apprenticeships, will be a critical step forward in helping those families regain their economic footing.
Veronica Goodman is director of social policy at the Progressive Policy Institute. Tressa Pankovits is associate director of Reinventing America’s Schools, a project of the Progressive Policy Institute.