US Manufacturers, Others Using German Apprenticeship Programs Model

The Obama administration and several governors have come up with a solution to the US’ difficulty in finding new employees in certain industries: using German-style apprenticeship programs.

Sven Boll of The Wall Street Journal reports that, though successful, the programs are attracting firms from Germany and countries other than the US.  For example, North Carolina’s “Apprenticeship 2000” which joins on-the-job training with classroom work, is drawing a number of German companies but only two US firms, Ameritech Die and Mold, Inc. and Timken Co.

In Michigan, Republican Governor Rick Snyder said he was going to “Amercanize” the German model, but almost three-fourths of the Michigan participants are firms which are based abroad.

Germany, in the meantime, has improved at fitting employees’ skills to employers’ needs.  The youth unemployment rate there is below 8%, about one-half that of the comparable group in the US.

Germany’s program is a leading cause of what European economists are calling the “German labor-market miracle”.  In the US, employees are hired and then trained; in Germany vocational training can take up to three years and the goal is to give the students qualifications beyond a single employer’s needs.  Students are paid by the company, get three to four days a week of on-the-job training, and spend the rest of the time in class at public vocational schools.The average cost is around $20,000 a year, and the program is developed by trade unions, the federal government, and employers’ association.

President Obama has discussed the German program on numerous occasions and now wants to double the number of apprentices in the next five years and has made plans to start a $100 million program to increase the number of apprenticeships.

“The power both of the federal and the state governments to push the collaboration between business and colleges on a regional level is limited,” said Monika Aring, an adviser to companies who has studied the issue for the International Labor Organization. Also, U.S. companies “are not used to collaborating with each other.”

In Chattanooga, Tennessee, Volkswagen is changing young people’s American track to its German-style apprenticeship program, according to Blake Farmer of Nashville Public Radio.  When accepted, the apprentices begin a three-year program learning how to maintain robotics in the US’s only VW plant.

They are paid a small stipend for being “mechatronics” students.  If they stay, they will be hired at $22 an hour and will have earned an associate’s degree from Chattanooga State Community College.  They may, if they like, defer their employment to finish their bachelor’s degree.

Spain, with jobless rates as high as 56%, is exploring the apprenticeship system of Germany as well.  The EU wants to promote an apprenticeship programs throughout Europe, says Patrice Hill of The Washington Times.

Ironically, Germany is worried about the shortage of suitable apprentices.  Right now, there are about 80,000 apprenticeship spots that are vacant.  Some students are staying in school rather than dropping out and others are going on to higher education.  In fact, 33% more students than a decade ago are starting their college studies.

“While it has never been so easy for young people to secure an apprenticeship, German companies are experiencing more and more difficulties in finding applicants,” DIHK President Eric Schweitzer said in a statement in Berlin.

That’s why the Association of German Chambers of Commerce and Industry (DIHK) officials are beginning a program targeting university dropouts who are being sought especially in the IT, banking, and insurance arenas.  Special incentives are being used to entice apprentices, like business cars and free smartphones, says a DIHK poll of 13,000 companies, says Deutsche Welle.