Filling Skills Gaps through Apprenticeships

HR leaders could fill some of their hard-to-fill positions by creating apprenticeship programs that teach individuals the skills their organizations are searching for. But a growing, often unnecessary, dependency on college diplomas as well as other barriers have kept many organizations from moving forward.

Wednesday, July 20, 2011
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It's no surprise to HR leaders that there's a growing divide in the United States between the needs of American employers and the education and skills of the American workforce.

Two widely held misconceptions stand in the way of efforts to bridge the career-readiness gap, according to a joint report (PDF) from the U.S. Chamber Institute for a Competitive Workforce and Corporate Voices for Working Families.

The focus on college too often excludes the demand for those who hold two-year associate degrees and trade-specific credentials, and little attention has been paid to the large number of undergraduates who leave college and other post-secondary institutions before completing their degrees. Just slightly more than one-half complete their degrees in six years.

At the same time, more than half (53 percent) of business leaders say their companies face a "very" or "fairly major" challenge in recruiting non-managerial employees with the skills, training and education their companies need, according to the report. This, despite an unemployment rate approaching 10 percent. 

Four of 10 (41 percent) of those business leaders are using apprenticeships to help combat the problem.

How Apprenticeships Work

In the United States, we tend not to think of apprenticeships for professional-level positions, yet positions in investment banking and consultancies often use apprenticeship-like programs, says Peter Cappelli, director of the Center for Human Resources at The Wharton School in Philadelphia.

"They hire people right out of college who have no skills, they put them to work in these programs, and work them like dogs for three to five years or so," he says.

While they get paid what sounds like a fair amount of money, "it's not that much," he says, when you consider how hard they work and the hours they work. But, when they finish those jobs "they have experience which is worth a lot more on the market."

Apprenticeships make sense in areas such as investment banking or consulting because success requires experience. The same is true in other professions as well.

"The big need we have in the workplace is workplace skills which you can't easily learn in school," says Cappelli. Others agree.

As director of executive recruitment for a Fortune 50 company, Caroline McClure created an apprenticeship program for executive recruiters.

"I believe that the only way to become a good executive recruiter would be through an apprenticeship program," says McClure, now the principal of ScoutRock, in Baltimore, a firm that provides consulting and networking services to other corporate executive recruiting professionals.

She notes it takes about an hour to learn the process of executive recruiting, but it might take two years to successfully execute the process and another five years to development stellar assessment skills to effectively screen candidates at this level.

There are several reasons for the lack of apprenticeships in the United States, experts say.

The economics "are a little peculiar" in that the individuals "basically pay for the training themselves by earning less while they're working than they're actually contributing," he says.

The collapse of unions has also contributed to a decline in apprenticeships, he says, because most programs "were kind of jointly run by unions and employers, and the unions kind of enforced them in the sense that they maintained a hierarchy and a wage structure."

Another barrier is a growing, often unfounded, bias for higher education, says Diane Auer Jones, vice president for external and regulatory affairs at the Career Education Corporation in Washington, and former assistant secretary for postsecondary education at the Department of Education.

Screening Resumes

Jones says there has been "this 'credentials creep' to where now you have to have a doctorate to count pills at a pharmacy or be a physical therapist."

Part of the driver is that HR professionals are using college as a screening tool.

That's understandable, says Jason Carney, director of human resources at WorkSmart Systems, a PEO in Indianapolis. "The attitude of employers is, 'Hey, the economy is down and there are a lot of professionals out there who will work for less now'."


Even so, he cautions against making degrees a formal job requirement.

"When you put these requirements in your job descriptions you're hard-coding them into your organization. You could run into an issue down the road for hiring someone without a degree."

Flexibility is key; he recommends using the standard: "four-year degree or equivalent experience" language.

In addition, he says, HR leaders should think more broadly, and creatively, about what is really needed to perform successfully in specific jobs, noting "the vast majority of jobs out there don't necessarily have to have [college diplomas]."

For instance, he says: "I'm a big certification fan. I would take an SPHR with 10 years of experience over somebody with two years of experience and a master's degree any day.

There is also a tendency for individuals -- and society as a whole -- to be somewhat snobbish about degrees, says Jones.

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She notes that her own son, who scored a 34 on the ACT (36 is the highest score, decided not to pursue college in favor of an apprenticeship in the trades and the dream of owning his own business.

"When people hear about it, they act like I had a child who died of cancer!" she says. "They'll say something like, 'Oh well, he'll go back later.' ... We have this misplaced sense of value and these artificial assumptions that if you're in the trades you're poor -- if you went to college, you're rich."

Sally Haver, with The Ayers Group/Career Partners International, says she has a strong personal bias about the issue.

"The most effective executive I know is a woman who didn't have any formal education beyond high school," she says. "She had to go out and support her family when she turned 18 and became a force to be reckoned with in the real estate and construction industry."

Employers that discount the value of non-college graduates are overlooking "some real talent that couldn't finish, for reasons that have nothing to do with smarts or ability to succeed," she says.

Internships, apprenticeships and "try-buy" situations can be good options for both organizations and applicants.

Overcoming Barriers

Cost may be another barrier to the implementation of apprenticeship programs.

Until employers reach a place where they feel they have to "train their own," they're not likely to do so, says Timothy G. Wiedman, assistant professor of management and human resources in the Division of Economics and Business at Doane College in Crete, Neb.

Many years ago, says Wiedman, he was a full-time professor at a community college and also taught courses in an apprentice program at a nearby defense contractor. It was, he says, "for all practical purposes a junior college oriented toward technical training."

And, "therein lies the rub," he says. 

"In my opinion, few organizations believe that they have the time and resources that are required to utilize apprenticeships as a general staffing mechanism," he says. "And that may be why relatively few apprenticeship programs currently operate in America."

McClure acknowledges, for example, that the executive-recruiting program she ran did not survive a senior leadership change in HR and is no longer in place.

Certainly, says Cappelli, there is risk involved for employers in investing in these types of programs.

To make apprenticeships work, he says, companies must first have jobs where it is possible to learn by doing, but "the second thing is that you'd have to have either an understanding that you're going to lose these people at the end of the process or you're going to have to raise their pay if you want to keep them."

Employees need to "pay" for the training through a lower salary at the outset while they learn the requisite skills. And, employers need to be prepared to raise their pay to a competitive level once the apprenticeship is complete.

Or, they need to be prepared to lose them.

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