THECOSTEFFECTIVENESSOFAPPRENTICESHIPSCHEMES–MAKINGTHEBUSINESSCASEFORAPPRENTICESHIPS
FinalConference
Brussels15.03.2016
AlexandraCostaArturKeithBrum;itt
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships
• Agendafortoday• Theproject/context/activities• Thedifferentsystems-de;initions-contractualarrangements
• Costeffectiveness• Governanceandpartnerships
• Conclusions/thoughts
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships
Theproject• Identifyingthecurrent‘stateofplay’+reformsin15targetcountries
• Collectionofexamplesofeffectivepracticeandpolicy(casestudies)
15 target countries – BG/CZ/EE/FI/FR/EL/HU/IE/IT/LV/PL/PT/SK/ES/UK5resourcecountries–DE/AT/DK/NL/SW3targetsectors–ICT/Commerce/Engineering
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • Outputs• 1questionnairetoBUSINESSEUROPE,CEEP,UEAPMEmembers
• SectorialquestionnairestoCEEMET,EUROCOMMERCE,DIGITALEUROPE,ERT,EUproVET,EFVETmembers
• 15nationalcountryreports• 1resourcecountriesreport• 1onlinequestionnaire• Interviews10casestudies• 5clusterseminars+FinalConference• FinalReport+Recommendations
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships• DeLiningapprenticeship• EuropeanCommission’sde;initionhighlights(updated)• -itispartoftheformalVETsystem;• -it involves a dual learning principle: combines oralternates company-based training (periods of practicalexperience at a workplace) with school-based education(periods of theoretical/practical education in a school ortrainingcentre);
• completing the apprenticeship leads to a nationallyrecognisedqualiLication;
• there may be a contractual relationship or agreementbetweenanemployerandapprentice.
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • The functioning of an effective apprenticeship systemdependsonmanyelements:
• itsplaceintheVETsystem;• governance;• contractualarrangements;• cost-sharing;• supportstructures;• recruitmentprocedures;• ownershipofthesystem.Important - right balance between these elements andrespect the diversity of different countries’ education andlabourmarketsituations.
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships Thedifferentsystems• Last threeyearsmanyof the15 target countrieshave reformedtheirVETsystems– toprintmoreWBLarrangements/elementsofthedualsystem
• Differentcontextsandmotivations• Political priority to youth unemployment/NEETs -occupationaltrainingandtrainingtoaspeci;icjob;
• asawayofachievearecognisedquali;ication;• awayoforganizingpracticaltrainingpartofaVETprogramme;• awayofaccesstolabourmarket;• awaytomatchlabourneedswithskills• awayto;indtherightskills
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • Each system can be considered in relation to whetherapprenticeships:
• areschoolbasedornot;• areawaytoachieveaformalquali;ication• foryoungpeopleoradults;• forthosewhoareemployedorunemployed.
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • WiderangeofdeLinitions/approaches- Apprenticeship integrated into school based initial VET –schooldriven(8countries)- Apprenticeship as a separate track – enterprise driven ( 2countries)
- Mixedformula–bothschoolandworkbased(5countries)Others programmes which support transition to the labourmarket (traineeship programmes) often developed tocomplement an initial VET programme or to provideadditionalhelptothosewhoareunemployed.
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships
• Duallearningprinciple
• Signi;icantdifferencesinthe15targetcountries- time spent in the enterprises is insuf;icient to enable thecompaniestobethedriversofapprenticeships
- 9 countries -work based learning is less than 50% -school based initial VET is the main model forapprenticeship
- 6countries-workbasedlearningismorethan50%oftheapprenticeship
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships Contractualarrangements
ApprenticesasstudentsVETprovideristheowneroftheprocess;Placementapproachratherthanalearningtime Apprenticesasemployees:Employersareinvolved:-intherecruitmentdecisions;- inassessmentandqualitydecisions- inthetimespentincompany,theorganisationoftraining- Inapprentices productivity
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • Apprentices’compensation
Theserangefromacompensationestablishedby:• collectiveagreement/nationalminimumwage• casebycasebasis-(schoolbasedsystem)
• Sectororganisation• National/regional/locallevel• Couldbelinkedtoproductivity
Thesesituationsarenotcomparableandthisprecludesasystematicanalysis.
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships
• Resourcecountries
• Apprenticeshaveacontractwiththeenterprises• Morethan50%oftimespentincompany• Compensationisde;ined
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • SME’s• Resource countries + well established apprenticeship systemcountries-SME’saremoreinvolvedinreceivingapprenticesthanthelargecompanies.SMEsneedskilledpeople.
• Countries more school based - large companies are in betterposition. SME’s face more challenges. Matching applicants iscritical.
• Supportsystems–intermediarybodies–keysuccesselement• CasestudyHowtheapprenticeshipprogramme isorganised isparticularly importantto a medium sized company and the practicalities have to be carefullymanaged e.g. everyone starts the programme at the same time as thecompanydoesnothave the resources tomanageapprenticesoperatingatdifferentlevelsandatdifferentstagesoftheirprogramme.
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships Apprentices provide enterprises with opportunities tomakeapositivereturnontheirinvestment:-acosteffectivewaytorecruittalent-distinguishonebusinessfromanother-helptobuildcompanyloyalty-improvetheskillsofexistingstaff-whenrecruitmentisdif;icult,a‘cheap’waytorecruit-overcome the mismatch between business needs andtrainingprovidedbyinstitutions
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • CostsandbeneLits
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • Resourcecountries’experiences
Sharingcostsandimprovingproductivity:• GermanyandAustria–in-companytrainingpaidbycompanies
• Switzerland–thestatecoversoff-the-jobeducation• Denmark–mainlystatefunded.Allemployerscontributetoacentralfund
• Netherlands–companiesreceiveasubsidyforeachapprentice
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • Costsandbene;itsvary
• occupation• sizeofthebusiness/enterprise• theeconomicsector
In general short term cost and long-term bene;its if theapprenticestayswiththeenterprise.Bene;itsdependonthelevel of the state’s support, but in well-functioning systemscompanies recover their costs by the end of theapprenticeshipperiod.
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • Whatdoestheresearchsay
OnlyGermanyandSwitzerlandhavestudiesonthecostsandbene;itsofapprenticeshipsfromtheperspectiveofcompanies.But• apprenticeships offer a relatively effectivemeans ofmeeting the skillsneedsofemployers.Thisistypicallymorecost-effectivethanrecruitingskilledworkersfromtheexternallabourmarket;
• apprenticeshipsproduceapoolofskilledpeoplefromwhichpromotionintomoreseniorrolescanbemade;
• labour turnover rates are often reduced as a result of providingapprenticeship training as apprentices who train with a company aremorelikelytoberetained;
• apprenticeships allow for company values and ethos to be instilled inworkers. Employers consider this to be particularly important whenapprenticesstaywiththecompanyaftertraining.
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • Whyaresomecompaniesreluctant?
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • ITsector–costeffectiveness
• Staffshortages• Mismatchbetweencompanyneedsandtraditionaltraining• Recruitingtonewoccupationalareas
Greatercontrolovercontent;apprenticesstartfromahighlevel;on-linelearningreducescosts.
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • Engineeringsector–costeffectiveness
• Traditionalapproachtorecruitment• Cost of capital has made traditional courses out of touchwithcurrentneedsofindustry
• New way to recruit staff with the required skills (staffshortages)
Apprenticeshipsareexpensivebuttheyhelptomeettheskillsneededbyindustry
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • Commercialsector–costeffectiveness
• Therateofchangeinthesectorneedstobemanaged–newoccupationsandprocesses
• The competences required by the sector are wellestablishedandagreed
• The development of soft skills and the need to learn tomulti-task
• The need to be up-to-date and respond to customers’requirements.
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • Governance,partnershipsandsocialdialogue
• TheroleofthestateisimportantinallcountriesFor those countries beginning to develop an apprenticeshipsystemthereisaneedforagovernanceframeworkalongsideclear mechanisms for engaging employers in the design ofapprenticeshipschemes.• Resourcecountries• Thestructuresaremoreinstitutionalisedandemployersarepartofthesystemonnational,stateandregional
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships
• Differentdegreeofsocialpartnersinvolvement
10ofthetargetcountries• Governancelevel–institutional/consultativerole• Operationallevel-autonomyofVETproviders
5ofthetargetcountries-aleadingorstrongroleforsocialpartnersbothatGovernanceandoperationallevel.Adevelopmentalrole.
• The effectiveness of a sector approach - betterway tomeet the skillsneedsofemployers;
• The emergence and growth of intermediate structures - facilitatecooperation, help to establish a clear division of responsibilities andmake the governance of the VET/apprenticeship system moretransparent.
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships
• Astronglevelofconsensusaboutthetrainingsystem(andthetraditionofself-regulationbythesector,thesocialpartners,theemployers)createsasafeenvironmentforcompanies.
About the lack of skilled workers in Denmark, the Confederation of DanishIndustry launcheda two-yearproject ‘OperationApprenticeship’ to encouragecompaniestosecuresufEicientskilledlabourthroughthecreationofadditionalapprenticeshipsandadviceonhowtorecruitapprentices.
• TheEirststep involvesthecollectionofdataandinformationontheneedforskilledlabourandapprentices.
• secondstep-forecastingthesupplyanddemandforskilledlabourin2025
• third step is to draw up a strategic plan with actions and an agenda toimprovethesituation.
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • ADECAT-Catalonia• Thesectorassociationusesadualtracksystemtosupportcompaniesinrecruitinganddevelopingstaffwiththerequiredtechnicalskills.
• ThestudentscompletetheoreticaltraininginschoolsandpracticaltraininginacompanyafEiliatedtotheADECAT.
• gratifyingastheAssociationworkswithsmall,traditionalcompanieswithemployeeswhoseaverageageishigh.Thearrivalofapprenticesalsoencouragesexistingstafftoreturntotraining.
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships • Somethoughts• skillsneeded(by2025)11countries–highskillslevels• 2countries–mediumskills• 2countries–lowskills• Higherskills/Higherapprenticeship• Forapprenticeshipstocompetewithhighereducationtheyneedtobeofferedatahigherlevelandtheyneedtoleadtoa quali;ication which is as well regarded as the outcomesfrom higher education. There is a need to develop higherlevel apprenticeship routes closely aligned with labourmarketneeds.Attractiveness
Thecosteffectivenessofapprenticeshipschemes–makingthebusinesscaseforapprenticeships
• A legal framework is a pre-condition - stakeholders,particularlyenterprises,needclearrulestoimprovetrustatboththegovernanceandoperationallevel.
• The social partners play an important role in improvingapprenticeshipsystems,inparticularwheretheyaredeeplyinvolvedintheirdelivery.
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