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Why German-Style Apprenticeships Are Not an Easy Fit in the United States

The German economy depends on strong national unions and complex licensing and certifications to discourage apprentices from leaving their apprenticeships prematurely. Americans may not be so keen on that.

Paying for job training has always been a challenge. When a Colonial American "master" shoemaker took on an apprentice, it would cost him at the outset. The master had to feed and clothe the apprentice as well as spend significant amounts of time training him. Somehow the master needed to be compensated, apprentices rarely had the funds to pay the full cost of the training upfront. Instead, the master was usually compensated in the form of a commitment to remain a certain number of years. During the early part of the apprenticeship, the apprentice would be more trouble than he was worth. During the later part, he was essentially paying the master back for his trouble.

What happened when an apprentice skipped out in the middle of his apprenticeship? He would be jailed, of course. A deal's a deal. Newspapers during the colonial period were full of runaway apprentice ads alongside notices about runaway slaves.

We don't jail runaway apprentices anymore. (Nor do I say we should!) But there is a price to be paid for refusing to do so. We still have plenty of young Americans without the funds to pay for their own job training. But since employers can't force their trainees to stay till they've have paid off their "debt," they can't be assured they will be compensated for their efforts. Consequently, traditional apprenticeships are much more rare today than they were in an earlier era.

The dominant solution to the "runaway apprentice problem" in America today is "socialized education" (otherwise known as public education). Employees of the state provide various sorts of job training. At the high school level, it is free to the student. At the community college and university level, it is heavily subsidized. Government guaranteed credit is available to cover the rest.

But every solution brings with it its own problems. The downside to public education is that the incentives for the state-salaried instructors are highly imperfect. Schools don't have access to the best information about what the needed skills of the future will be. That information is spread among thousands and thousands of large and small businesses. So schools can end up training lots of travel agents, at a time when travel agent jobs have dried up. Even when they have the information, they may be sluggish to respond to it. Since their pay comes out of tax money, not out of profits, the incentive get things right is blunted.

Germany has a different approach. More than half of young Germans serve at least one apprenticeship. And Germans are less likely than Americans to go to college. But because German employers provide the training, they face the same problem that early American "masters" who took on apprentices had: How can you ensure that the apprentice won't skip out on the apprenticeship?

The dominant solution to the "runaway apprentice" problem there is to have complicated certification requirements for many jobs. If you don't stick it out in your apprenticeship, you won't get your certification and you therefore won't get a job in your chosen field. Union membership can work the same way there. If you don't finish your apprenticeship, you don't get into the union (and hence you don't get a job).

Americans aren't keen on unions having that level of power. Many have fought hard for right-to-work laws and aren't about to back away for those laws. As for licensing and certifications, there is now bipartisan agreement: We already have too many licensing and certification requirements. Most Americans don't want more.

As a result, we probably can't hope to have the large number of apprenticeships the Germans have. When a German-style apprenticeship program in the construction industry was tried in North Carolina a while back, the inevitable occurred: Apprentices skipped out on their employers part way through their apprenticeship and went to work for companies that weren't participating in the program. The latter could afford to pay higher wages, since they weren't paying for on-the-job training.

None of this means that apprenticeships will never work in this country or that they aren't needed. Our current methods of teaching marketable skills generally leave a lot to be desired (and even if they were excellent, they aren't everyone's cup of tea). But it's hard. I wrote about all this in an essay entitled Apprenticeships: Useful Alternative, Tough to Implement. In it, I tried to suggest some partial solutions to the problem.

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  • BillyG||

    As a result, we probably can't hope to have the large number of apprenticeships the Germans have. When a German-style apprenticeship program in the construction industry was tried in North Carolina a while back, the inevitable occurred: Apprentices skipped out on their employers part way through their apprenticeship and went to work for companies that weren't participating in the program.

    Couldn't the companies have required a contract for a certain number of years of work? It'd be no different than co-op programs for college students where by you agree to work for whoever is paying for your college for X years after you complete the program. It seems the problem has already been solved, its just a matter of applying it to blue collar jobs.

  • Scarecrow Repair & Chippering||

    How are these co-op contracts enforced? Does the student incur a huge debt which can't be cleared by bankruptcy? How do you prevent employers from treating students poorly, as happens now with H1B employees?

  • BillyG||

    To my understanding, if they don't complete the time then they incur a debt (pro-rated) equal to the amount their education was funded for. As for treatment, they're actually working for the company before they're out of college. They're going to find out what its like and be able to choose. In addition, any company that wants to keep the students after the time period is up won't treat them poorly or they'll lose their investment in them and they'll go someplace else. Personell are resources, good companies treat them as such and invest in them. Word gets around about terrible ones and people find other places to work.

  • bernard11||

    if they don't complete the time then they incur a debt (pro-rated) equal to the amount their education was funded for.

    What happens when the company doesn't live up to its end, and assigns the student menial tasks that provide no real training? The student leaves, the company tries to collect, and you've got a mess.

    any company that wants to keep the students after the time period is up won't treat them poorly or they'll lose their investment in them and they'll go someplace else.

    What happens when the company faces a downturn in business and has no intention of hiring the student for a permanent position? Then there is plenty of incentive to treat the student poorly during the apprenticeship period.

  • Scarecrow Repair & Chippering||

    No well-run company would treat a valuable employee as minimum wage labor. Or to put it another way, companies who undervalue employees will lose in the market place.

    Companies whose mistreatment violates the hiring contract will lose in court.

    Companies whose mistreatment violates law will lose bigly.

    As for companies laying off employees during bad times, that happens now and no one panics about a breakdown in moral fiber.

  • bernard11||

    No well-run company would treat a valuable employee as minimum wage labor. Or to put it another way, companies who undervalue employees will lose in the market place.

    Employees aren't valuable if you don't have anything useful for them to do.

    Companies whose mistreatment violates the hiring contract will lose in court.

    Yeah. There will be a lot of lawsuits by out-of-work apprentices. Sure. Which planet are discussing again?

    Companies whose mistreatment violates law will lose bigly.

    How?

    As for companies laying off employees during bad times, that happens now and no one panics about a breakdown in moral fiber.

    Yes. But the laid-off employees haven't just spent a couple of years working at a low wage to get certified in some profession or other. This has nothing to do with moral fiber.

  • BillyG||

    Have you never heard of college co-op programs befores?

    What happens when the company doesn't live up to its end, and assigns the student menial tasks that provide no real training?

    Why would a company spend money to train an employee only to underutilize them? It's a great way to go out of buisiness. Remember, the company is NOT the one providing the training/education. What I've presented here is something that is actually done in the US today for college students.

    What happens when the company faces a downturn in business and has no intention of hiring the student for a permanent position?

    Then the company is short sighted and wasted a bunch of money. They get nothing if they don't hire the student. It's the company's breach of contract, not the students at that point.

  • nonzenze||

    Sounds like a good deal -- get the training, incur the debt, then declare bankruptcy with virtually no assets.

  • Tatil Sever||

    What makes you think declaring bankruptcy would discharge all debts, rather than judge turning your debt into monthly payments based on the new job you just accepted?

    Sure, you could wait until the proceedings are concluded before you take on a new job, but that would mean months without an income. Your new job would have to pay you a lot more for this move to make financial sense. That's in addition to the paperwork hassle and the hit to your credit history, which may also make it difficult for you to get a job.

  • Robert||

    Washington Irving had a story about someone who skipped out on his apprenticeship to a physician. I forgot its name.

    American unions frequently have practiced such selectivity in admitting members. What the unions don't have now is the degree of gatekeeper function they once had to the workplace.

  • Sarcastr0||

    Americans might not be against certification if it were a must-issue tied to an apprenticeship program.

    Echoing our discussion of the suboptimal state of America's meritocracy, America could use a much more robust non-academic training infrastructure for those who aren't keen on sitting in the classroom but still have talent and drive.

  • BillyG||

    Americans might not be against certification if it were a must-issue tied to an apprenticeship program.

    The certification requirement must still be justified in the first place or you're still going to have people against it. See prior VC IJ posts on hair braiding requiring certification. If it is justified, you're also going to need to ensure equal opportunity for everyone trying to get admittance into the program and throughout it. Unions used to discriminate against blacks as a gateway to getting jobs. Need to ensure nothing similar happens.

    America could use a much more robust non-academic training infrastructure

    Do you mean vocational programs? I'd like to see those brought back more for high schools msyelf.

  • Sarcastr0||

    That's my point - the justification is integrate an apprenticeship program with the workforce; to assure that people purporting to have been apprenticed are telling the truth, akin to people claiming degrees.
    ================
    My sense, although I may be disabused of it, is that the generalized skillset of high school makes it a bit early to leave school in today's world. Technical or vocational training would be a better substitution for college than otherwise.

  • nonzenze||

    @Sarcastro, you can use angle-brackets-blockquote.

    HIIII

    You can even nest 'em

    Nuh-uh
    Yeah huh
  • Sarcastr0||

    I've just been using section breaks as a symptom of how I write at work. If it bothers people, I can just go to paragraphs like a normal person.

  • BillyG||

    I wondering if we've got a mixup in meaning. The general problem with certification is that many times it's an artificial a barrier to getting a job which doesn't need whatever certification is required. So unless the training is justified, its still going to have the same pushback. Going back to the hair braiding case, there's no reason for a government mandated certification/licensing program for braiding hair. Handling and using the hair dye chemicals is something for discussion, but for braiding hair? No. Even if linked to a must-issue apprentice program, the need for the program itself cannot be justified.

    I do agree technical/vocational training would be better than college for many. I also believe it should be starting in high school. There's little need for calculus in most professions. If someone isn't going to college, I think they'd be better served with other areas of study. There's other things I can think of would be more useful in the trades too than what I learned in High School, I'm pretty sure you can come up with a number yourself.

  • Sarcastr0||

    I think we are on the same page re: 'good' licensing and 'bad' licensing. That was a distinction I was trying to make with my 'must-issue' term.

    I don't think people should start specializing in high school. There is something to be said for a well-rounded education where people know stuff that has a decent chance of not being of immediate professional utility.
    Though I'd be down with lowering some of the more technical requirements to electives in high school.

  • TLBD||

    There is no incentive to train anyone when you can hire someone with gov't subsidized training already.

    Especially when colleges train so many people in certain skill areas that they're competing for the lowest job on the ladder.

    Apprenticeship isn't failing because we're not doing enough, it is failing because we have done too much between subsidies and licensing that often require college degrees.

    Stop requiring degrees and stop subsidizing. On the job training/apprenticeships will make a comeback.

  • Scarecrow Repair & Chippering||

    I think there's something to this. I've never put a lot of thought into apprenticing and on-the-job training, but if employers and employees did have to make mutual arrangements in a free market, something would shake out; that's what free markets do. The training, for instance, could be provided and billed in monthly increments, such that job-hopping and bankruptcy would not be attractive to trainees and treating trainees like dirt (like current H1B employees) would not be attractive to employers. It would also be a lot easier for employees to try several fields to see which ones are attractive and have potential,and for employers to see how well trainees match the business.

    Very few job skills require years of education and training before having any use. Lawyers, doctors, engineering -- all have lots of low-level work requiring only basic training. The final degree-equivalent may require lots of training and experience, but the path to that final degree could take ten years if necessary, allowing a lot more flexibility than current schooling. It would also be easier for people to change careers after 10 or 20 years.

  • nonzenze||

    This mistakenly believes that "low-level work" in the same field is at all useful to a professional. This is simply not true. A doctor would not learn anything doing MA or lab tech work that's transferrable to her ultimate job as a physician. The low-level and high-level medical work are more or less entirely disjoint.

    Note of course that medicine has implemented the article's preferred solution without unions and without government regulation through board certification and residency programs.

  • Scarecrow Repair & Chippering||

    Of course a doctor wouldn't learn anything useful doing scut work. But it takes 8 years to get an MD, I think. You seem to think a doctor is useless until he's completed that full education. That strikes me as an extreme form of parchmentitis. Start by sweeping floors and delivering mail 4 hours a day, study the rest of the time. Progress to nursing aid, working the admissions desk, emptying bedpans. Progress to nurse, and there are different levels of nursing expertise. If the desire and capability is there, continue on up until some hospital hires you as a resident, then become a certified doctor. Rather than 8 years of study alone, make 16 years of both.

    I have worked for doctors. They describe many hours of stupid study of little relevance. The majority of their education is useful, but not taught efficiently. One doctor I worked with went all the way through residency before deciding he was not cut out to be a doctor. II imagine he'd have been a lot better off learning in stages.

  • OldCurmudgeon||

    IDK. Young lawyers traditionally started out doing document review, legal research, etc; then routine motions, then depositions, then... I suspect young doctors have a similar progression, maybe from "take a medical history" to "appendectomies, etc" to "organ replacement"

  • Tex Doc||

    From medical school through residency and sub-specialty fellowships, physicians undergo graduated academic and clinical responsibilities in order to attain competency in their area of specialty. Along the way, a lot of basic skills are learned, from drawing blood, to starting IV's, to basic procedures, along the path to a variety of procedures and skills. Gotta start somewhere. It is better now - less "scut" work than in past decades, but there is something said for believing you should be placing orders for a procedure you have not done.
    And it all starts with the question "What can I do for you today?"..and the history and physical goes from there.
    Failing to complete the residency - cannot practice.

  • FlameCCT||

    That reminds me of the court case in CA about a guy wanting to learn horseshoeing. CA requires a HS diploma to attend even training programs.

  • dwb68||

    Perhaps, but companies have other ways of making employees stay. For example, if you go to school (say, graduate business school) and the company pays for education, the company can forgive a portion of the debt over time. If you leave early, you will have more debt. They can also offer deferred compensation, which vests if you stay for a certain number of years. Both are common (and may also apply to things like signing bonuses and moving expenses) and 100% legal.

    It is often the case that if you leave a job early, the new company will not make you whole on deferred compensation, or other future benefits.

    In other words, its part of the employment contract. Apprenticeships can be done in a legal way, its just a matter of correctly structuring the contract and future benefits.

  • MikeP2||

    "In other words, its part of the employment contract. Apprenticeships can be done in a legal way, its just a matter of correctly structuring the contract and future benefits."

    Yeah, this article seems weak and poorly thought through. There are many examples of employment contracts in the US, particularly around continued education where the company requires a commitment time for tuition reimbursement. An apprenticeship could easy work within the same framework. Jailing people is not necessary when we have civil and financial punishments for violating a contract. I had a colleague skip out on a contract early, and negotiations for the pay-back for the tuition was part of the exit process.

    And relative to Germany, I don't see anywhere mentioned in the article the restrictive aspects of German higher education. I was of the understanding that from HS onward, there are a series of qualification hurdles, and failure to meet them took away the options of state funded higher education through college and graduate studies. Apprenticeships are the alternative. In the US anyone who can obtain a loan can go to college. Apprenticeships need to look good relative to that.

  • bernard11||

    Schools don't have access to the best information about what the needed skills of the future will be. That information is spread among thousands and thousands of large and small businesses. So schools can end up training lots of travel agents,

    This is a highly idealized view of business. We are not talking about trends over the next two or three years, which is what businesses are going to know something about, but with longer term issues. Public school systems may not know a lot about what the job market is going to require in ten years, but I doubt many businesses do either. At least the schools have some reason to think about it. Small businesses in general are going to be very near-term focussed.

    In addition, they will be very focussed on company-specific skills and tasks, rather than worrying much about more general skills, like reading.

  • David Bremer||

    I also thought this passage was a bit ill-reasoned. While schools don't always have this information, I'm not sure businesses are that much better.

    If they were so good at assessing market trends, we wouldn't see the massive layoffs of various types of workers. After all, they'd have adjusted their hiring and training so as not to end up with an oversupply of workers in a given area. We'd also not see so many businesses and business models overturned by disruption in the industry.

    The flip-side of the apprenticeship/certification process is that it also discourages people from leaving a given area. Consider two people: One is three years into a 4-year degree; the other is three years into a 4-year apprenticeship with an employer. If the market turns, the student can leave school and return later or transfer the credits to a different school/major/program. The apprentice generally cannot do the same (particularly since an employer may be reluctant to hire someone who left part way through). So the apprentice has an incentive to stick it out one more year, even when it may not be the best plan to do so.

  • tkamenick||

    There's still a lot of imperfect information on the business side, but (a) the information is more available; and (b) the incentives to get the right information and interpret it correctly are higher in the marketplace than in the education field. It's a continuum, but businesses in general are much farther to one end than schools.

  • bernard11||

    the incentives to get the right information and interpret it correctly are higher in the marketplace than in the education field.

    I don't think this is true for long-term trends.

    Nobody hires someone today because their skills will be really valuable in 2028.

  • Brian Kennedy||

    In the U.S., for occupations that are sufficiently specialized that the employer is a natural monopsonist in the labor market or where the employers can form a labor-side cartel, don't we already have what amount to effective apprentice-type programs? A monopsony example is air traffic control, one of the (ultimately) higher-paying jobs that doesn't require a college degree where the FAA provides extensive training at its specialized academy in Oklahoma before a new hire actually guides traffic (plus, AFAIK, the FAA doesn't throw fresh academy grads straight into O'Hare). Pro baseball and pro hockey are cartel examples (or monopsony ones if MBL and the NHL are each considered single enterprises), which likewise don't require a college degree and through the minor league and (in hockey) junior systems in effect provide apprenticeships.

    For the mine run of occupations, would it help if (what I vaguely recall is) the common-law rule that employment contracts can only run for a year was lengthened?

  • jdgalt1||

    It amuses me that the author of this piece shied away from calling the old-time apprentices "indentured servants", which of course they were. Of course, that system was much older than colonial America; it existed in most cities in the Middle Ages, and in slightly different forms in Rome and earlier. In all these cases the system involved both occupational licensing and guilds. The original reason for it was that learning a skilled trade required a huge commitment of time and effort both by the student and his teacher, and it would have been a waste of time if the city involved weren't willing to guarantee the worker a good return on his efforts by protecting him from too much competition.

    There are several problems with that way of thinking, such that it had to be abandoned for the modern world to emerge. The most obvious are that it stifled technological progress, and that as the population grew, the guilds would resist growing in proportion, resulting in a shortage of jobs and ultimately civil unrest.
    (continued)

  • jdgalt1||

    (continued)
    The fact that it relied on indentured servitude was not a problem, and indeed is sort-of true even today since student loans have been made non-dischargeable in bankruptcy. On the other hand, the fact that masters have been replaced by universities has severed responsibility in the other direction -- if you get out of college with no hireable skill, you still have to pay the college. That, I believe, is where the present system is broken. Change the law on that point and the market will become able to shut down colleges if most of their degrees turn out to be useless.

  • BillyG||

    if you get out of college with no hireable skill, you still have to pay the college. That, I believe, is where the present system is broken.
    No, you don't pay the college. Largely today you pay the Federal Government, specification the Department of Education, whom you borrowed the money from.
    Change the law on that point and the market will become able to shut down colleges if most of their degrees turn out to be useless.
    Then, unless i'm missinterpreting you, you're back with the problem for why educational debt is non-dischargeable in bankruptcy. People were going to college for four years, racking up the debt, then immediately declaring bankruptcy after graduating (no assets, no income) and walking away from the loans with a valuable degree.

  • jdgalt1||

    If a degree doesn't get you hired, it isn't valuable. You've either chosen a stupid major or have been scammed by the college. Allowing discharge in this situation will make it the college's responsibility to prevent these problems, since otherwise they have to repay the lender.

  • tkamenick||

    Doesn't Germany also have a much more highly-tracked secondary education system? If I recall correctly from my school days (and if it hasn't changed much in the meantime), somewhere around what would be 9th grade here, students choose standard school, professional prep for people wanting to be like doctors & lawyers & such, and tech schools for skilled trades.

  • Doug Huffman||

    I graduated HS in 1966 in a XX academic track. Z - dead end, Y - vocation, X - academic; there was no formal XX but we participated in college level courses at and from the local university.

    That was during the testing era, now abandoned in the name of forced agalitarianism.

  • Sanctimonica||

    The IJ would not like apprenticeship regulations. At. All.

  • TwelveInchPianist||

    "The downside to public education is that the incentives for the state-salaried instructors are highly imperfect. "

    Here's a ERik Loomis, a URI professor's view of his taxpayer-funded duties:

    "I'm not providing a service. Students are paying for the privilege of spending time in my presence. In exchange for that money, I have a professional duty to evaluate them on whether they have tried to make that a positive experience for themselves and to help them achieve that goal, if they have it."

  • texToo||

    There is a very simple solution to this with little fuss or worry. Exempt Apprentice Programs from the minimum wage. Some lucrative jobs may attract people working for free, others $1-5/hr, or whatever the market will bare. In any given trade, some candidates may seem more promising than others & be offered higher than average apprentice pay. Companies can design programs where the apprentice is earning his keep while learning the trade, maybe by being a janitor for x-hrs/day to pay for his training or a gofor for the journeyman, but still paying his way by making the journeyman more productive. If the guy quits, fine. If the guy thinks he's not making progress he just quits, maybe try with another company or try another trade. If he continues & learns the trade the company may hire him but would need to compete with others who might also need him. A simple arrangement between a guy(girl) & a company with "1000s & 1000s of companies large & small" to choose & to satisfy current needs.

    This may or not generate as many apprentices as Germany does or as many as needed, but it would create a lot of 'em & not have Germany's restraints nor problems of other proposals. It is worth a try & I think more likely to succeed than Heriot's paper.

  • ReaderY||

    I believe this is the first time in the Volokh Conspiracy that an invited Conspirator has ever had anything positive to say about licenses, regulations, or unions.

    If strict libertarian theory were correct, you would think countries like Germany, with its heavy regulation of industry and labor, would be among the poorest in the world, rather than one of the richest.

    As the post illustrates, barriers to entry imposed by licensing, regulations, and unions can have the positive benefit of permitting private education to be done by industry in a manner that addresses free rider effects without compelling people to keep labor contracts. The Conspiracy's repeated message that education requirements etc. are just useless insider self-dealing is not the only side of the story that can be told. Regulation also ensures industry fulfills it's part of the apprenticeship bargain.

  • Doug Huffman||

    Has anyone else here completed a Union Apprenticeship? I thought not.

    My inducements were guaranteed employment in a tight market, at a wage 80% of working level, and a mid-level management career path. Now that I think of it, similar inducements applied to my VN Era USN enlistment that preceeded my apprenticeship. I completed both, worked for two years as Leadingman and left for engineering.

    I was early retired by BRAC-3 as a GS-12 'Rickover Evil Necessity' Nuclear Engineering Technician/Shift Test Engineer. Then I went on to higher education in maths, physics, literature and the humanities in my extended retirement.

    I argue against credentialism and authoritarianism that lead to the morass that education is now.

  • Gumlegs||

    Andrew Johnson (yes, the Andrew Johnson) was a runaway apprentice, and an ad exists offering a ten dollar reward for him.

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