Organizations and their talent acquisitions programs are increasingly seeking ways to bolster their talent pools for both contingent workers and direct employees — direct sourcing, talent clouds, online staffing, reskilling and upskilling are all hot topics of conversation. However, an often-overlooked path to an increased flow of long-term, trained talent into a company is one of the oldest methods around: apprenticeships. These programs can benefit everyone, including HR and contingent workforce managers.

Apprenticeships can work for all types of roles, not just skilled trades and union jobs. From IT to healthcare and more, industries are finding ways to combine education with on-the-job training to increase their talent pipelines. And the government is looking to fund these programs.

There are two types of apprenticeship programs supported by the US Department of Labor: A Registered Apprenticeship Program is a proven model of apprenticeship that has been validated by the DOL or State Apprenticeship Agency, while an Industry-Recognized Apprenticeship Program is recognized by a Standards Recognition Entity pursuant to the DOL’s standards.

Either type can help an organization solve its talent problem. Some common benefits include:

  • Vet workers and instill your company’s culture
  • Recruit and develop a diverse and highly skilled workforce
  • Improve productivity, profitability, and your bottom line
  • Reduce turnover, improve loyalty, and retain top talent
  • Demonstrate investment in your community

Federal Action

President Biden in February rescinded Trump’s 2017 executive order 13801, which created an industry-led apprenticeship program that minimized the federal government’s role in training opportunities and allowed private companies to create their own programs for on-the-job training. The program received criticism at first and was slow to get established, as Democrats in Congress blocked funding, Amanda Connelly, an associate at law firm Roetzel & Andress, wrote in a JDSupra blog post.

Biden also reinstated the National Advisory Committee on Apprenticeships and endorsed the National Apprenticeship Act of 2021, which passed in the House on Feb. 5, and aims to create and expand registered apprenticeships, youth apprenticeships and pre-apprenticeship programs.

Funding Targets Program Expansion, Diversification

The US Department of Labor last week announced the availability of approximately $87.5 million for grants to expand registered apprenticeships nationwide, with up to $40 million of those funds awarded to states that implement required diversity, equity and inclusion efforts and demonstrate their commitment to adopt, expand and promote these efforts.

States can apply for the State Apprenticeship Expansion, Equity and Innovation Grants ranging from $2 million to $10 million based on state-specific capacity and needs.

Apprentice vs. Intern

Unlike internships, which typically target college students and offer temporary roles for academic credit, registered apprenticeship programs teach in-demand skillsets for specific industries through a combination of classroom instruction on the critical aspects of the career and on-the-job training under the instruction of an experienced mentor. Participants in registered apprenticeship programs earn a guaranteed wage during their training and 94% of those who complete an apprenticeship retain employment, with an average annual salary of $70,000. They also receive an industry-recognized and nationally portable credential.

“Internships are usually unstructured and emphasize entry-level work, while apprentices work closely with a mentor to improve their skills and, in registered apprenticeships, they earn a higher wage as they advance,” states a report by the Brookings Institution, a nonprofit public policy organization based in Washington, DC. ”Interns rarely experience close work with a committed mentor and may or may not be compensated for their work.”

And there is plenty of talent in this pool. Nearly 25,000 registered apprenticeship programs were active across the US in fiscal year 2019, serving more than 633,000 apprentices, according the US Department of Labor. More than 252,000 individuals nationwide entered the system and 81,000 apprentices graduated.

All Sectors Can Benefit

Apprenticeship and on-the-job training programs have existed in union trade organizations for generations. And more recently, employers in the IT and healthcare sectors have implements programs with other industries planning programs as well. Even the insurance industry is taking part.

Zurich North America, one of the largest providers of insurance solutions, launched its US apprenticeship program in Illinois in 2016. The first apprenticeship program of its kind to be registered with the US Department of Labor, the Zurich program started with a focus in general insurance, which is the focus of all the open apprenticeships this year. Every two years, it offers IT and cybersecurity apprenticeships. This year, Zurich has positions available for the first time in Atlanta and in select agricultural states supported by Zurich’s crop insurance business, RCIS. It is also hiring apprentices who will be based at its North American headquarters in Schaumburg, Illinois, and at its New York City office, which had its first group of apprentices in 2020.

Zurich’s two-year program combines targeted coursework through community colleges with relevant work rotations. It provides a full-time salary and benefits as well as the tuition-paid college coursework. Apprentices who successfully complete the program earn an associate degree, a promotion at Zurich and a US Department of Labor apprentice certification. After completing the program, some choose to continue their studies toward a bachelor’s degree, with help from Zurich’s tuition reimbursement benefit, while working full-time at Zurich.

Diversity is important to the program, with people of color representing about half of Zurich apprentices and apprentice alumni. The program attracts veterans of the armed forces, high school graduates or those with an equivalent certification, people wanting to move from a job to a career, and those returning to the workforce after a hiatus, often for family reasons.

“We continue to invest in our trailblazing apprenticeship program because our apprentices contribute meaningfully to our business success,” says Zurich North America CEO Kristof Terryn. “Apprenticeship programs like Zurich’s can help build a skilled workforce with diverse perspectives that has been trained using the latest tools and technologies to meet the challenges of a rapidly changing world.”

Getting Started

A dedicated Department of Labor website provides information for companies looking to get apprenticeship programs started. Contingent workforce program managers can use the website when developing their business case to secure buy-in, identifying roles that are suitable within their organization and building the program.