Utah is recognized as business-friendly for many reasons, such as the economic outlook and an educated workforce. But as the U.S. ages, older workers retire and graduating high school seniors continue to opt for something other than learning a trade. Old solutions and strategies have become ineffective, and too many job openings for skilled work go unfilled. The Rural Water Association (RWAU), which consists of public and private water and wastewater systems in cities and municipalities, noticed a big gap in the number of workers retiring as opposed to the number of new employees it was able to hire. To help fill this gap, RWAU worked with the Department of Labor, Office of Apprenticeship and Workforce Services to set up two apprenticeship programs and now serves as an intermediary between potential apprentices and its membership base by providing classroom instruction and support throughout the process.
Business needs are fluid, and learning new skills is a prerequisite to being employable. Utah’s business owners were reminded of how fast shifts can occur when the pandemic recession hit and some of Utah’s major industries found their revenue sources disappearing.
In October 2021, Utah’s unemployment rate was 2.2%, the lowest rate ever recorded. That means about 37,400 Utahns are unemployed. The job growth rate has been 3.7% over the last 24 months, but companies have cumulatively added 58,500 jobs since October 2019. These numbers tell us Utah jobs are growing more than before the pandemic, but participation levels are less than pre-pandemic. Many people have shifted career paths, or some are reluctant to enter the job market again. This shortage of potential skilled workers does not help businesses deal with the current skilled labor shortages.
How can the state help businesses meet the current shortfall of skilled workers? Apprenticeships can be a good tool business owners can add to their repertoire of recruitment and retention strategies. Apprentices benefit by being trained for work, getting paid, and ending with nationally-recognized credentials.
The state launched Apprenticeship Utah, an initiative through the Department of Workforce Services designed to increase awareness and participation in apprenticeship programs by employers and future apprentices. Utah’s first comprehensive website, apprenticeship.utah.gov, connects employers who offer apprenticeships with potential employees. Melisa Stark, Commissioner of Apprenticeship Programs in Utah, participated in a seminar about the program held Nov. 16, 2021, during the seventh annual National Apprenticeship Week (NAW). The information in this article is from her presentation and the program’s website.
Apprenticeships are a tried-and-true training system combining paid on-the-job learning with formal classroom instruction. On-the-job learning is done at the same time as post-secondary education. Hiring an apprentice allows apprentices to prepare themselves for highly-skilled careers more quickly than would be possible otherwise. Everyone wins.
Thanks partially to the pandemic, apprenticeship programs have increased throughout the country because they allow employers to find and train employees for highly skilled work. The number of programs nationally has increased 70% over the last 10 years. There are now almost 26,000 programs with more than 636,000 apprentices training throughout the country. Additionally, the retention rate for employees who complete their program is 92%.
After program completion, the average wage for employees is $60,000 per year. Apprentices earn $300,000 or more during their careers than those who don’t participate in an apprenticeship program. The U.S. Department of Labor recognizes approximately 1,200 occupations as suitable for an apprenticeship. And Utah has seen a 25% growth rate in the last year for youth apprenticeships (for people ages 18-24).
Utah already offers apprenticeships in many industries. Although most people think of construction apprenticeships, they also work for other industries, including I.T. and health care. Common elements are found in high-quality programs, such as the apprentice is paid to learn in a structured, on-the-job setting. A skilled employee teaches the apprentice, and the program includes related information presented in class. The apprentice’s developing abilities are assessed against established skills and competency standards, and as the apprentice gains experience and skill, wages are increased to match. And finally, the program ends with an industry-recognized credential, certificate or degree.
If you have an apprenticeship program, you put yourself in a position where you can control the training for new employees. That makes these programs a valuable resource.
Most Utah apprentices are in the 25-34 age group, but the state hopes to attract more people who are just graduating from high school and are ready to enter the workforce. They want high school graduates to know enough about the program to make informed decisions about their direction after high school instead of defaulting to postgraduate schoolwork or low-wage jobs. Pre-apprenticeships and youth apprenticeships can give a foundation as early as junior high school. Pre-apprenticeships might also be a good choice for people changing industries or returning to the workforce after a long absence.
There is a marked difference between an internship and an apprenticeship. Think of internships as “try before you buy” and apprenticeships as “train to retain.” Internships are short and don’t usually carry the possibility of long-term employment. And, internships may or may not involve credentials and mentors.
However, with an apprentice program, you are investing in the apprentices. They are taught in a formal setting that leads to gaining the appropriate credentials, and they are under the direction of a mentor They are employed officially and continue to be employees after completing their training. And, the national retention rate for apprentices is 92%.
With an apprenticeship program, there are several benefits and returns on investment you can expect. An apprenticeship program is a way to create a skilled workforce where the skills are flexible, and training can be customized to your specific work environment. Apprentices learn best practices and your culture from the very beginning. Employers report that apprentices often outperform market-recruited employees.
With an apprenticeship, you often build company loyalty. Participants know they are valued and are making a contribution. They are more likely to stick around, so turnover is reduced. Also, it is an effective way to build diversity. Low-wage, high-turnover jobs are often the first to disappear in a downturn and the last ones to return to jobs, too. Companies that recruit certain populations can diversify their workforce through apprenticeship programs.
Having apprenticeships often makes companies more productive, profitable and innovative. Mentors appreciate the opportunity to share the skills they’ve learned, morale improves throughout the company and employers can identify people who may be well-suited for growth within the company, whether as a manager or someone with valuable skills. According to Nicholas Wyman, CEO of the Institute for Workplace Skills and Innovation (IWSI) America, employers can earn a 36% return on investment because of apprenticeship training. For context, S&P 500 companies usually see an ROI of 10%. Companies with apprenticeship programs have said that every dollar spent returns $1.50 because of increased productivity, innovation and reduced waste. And companies with apprenticeship programs have access to federal and state funding.
If you consider starting an apprenticeship program, an obvious starting point is filling current needs. But building a pipeline of potential employees is important so you won’t have the same shortages five years from now. Apprenticeships can help with future staffing needs, especially if you allow current employees to participate. A few technical or leadership skills can make all the difference for them. When you are allowed to do so, take part of your reimbursement funds and put them back into apprenticeship programs for new employees so they won’t have to wait before starting a program.
Apprenticeships can help disadvantaged and marginalized workers reengage with the job market after the pandemic and gain the necessary skills for a successful career path. During the pandemic, employers saw an unusually high number of skilled employees who retired and had problems replacing them. Enlarging the pool of potential employees helps with that.
Everyone benefits when businesses have apprenticeship programs to train potential employees and existing employees. From the Department of Workforce Services’ viewpoint, the goal is to expand the employee pool, a strategy that helps employers and potential employees.
Apprenticeships can help disadvantaged and marginalized workers reengage with the job market after the pandemic and gain the necessary skills for a successful career path. During the pandemic, employers saw an unusually high number of skilled employees who retired and had problems replacing them. Enlarging the pool of potential employees helps with that.
Enlarging the pool means increasing diversity, and Utah’s businesses have plenty of room for that. Over 4,400 people are currently active in Utah’s apprenticeship programs. More than 1,668 started their apprenticeship in 2021, and 29 new programs started the same year. As stated previously, most apprentices (1,894) are in the 25-34 age group. (For 18-24, the number is 1,187, and for those older than 35, the number is 1,140.) Some 8% are veterans. By gender, about 3.2% are female, and 96.8% are male. Most are white, but a larger percentage of minorities are generally participating than in the state’s population.
Apprenticeship programs can cause a cultural shift in companies, especially in their diversity, equity, inclusion and accessibility (DEI&A) efforts. Instead of viewing apprenticeship programs that support DEI&A efforts as a form of charity, they discover the programs are a business investment. And by cultivating talent, employers move from a transactional approach that consumes talent to an ongoing collaboration that co-produces talent. Employees gain general skills and company-specific skills.
Apprenticeship Utah actively provides how-to information to the business community. The program’s leaders understand that new programs can require businesses to form partnerships with local schools, including high schools. They also know businesses may need guidance about how to create a program.
If you have additional questions, contact Apprenticeship Utah at apprenticeship.utah.gov, by email at apprenticeship@utah.gov or 801-707-3549.
