How to break down the specifics of investing in apprenticeships

October 2011 - Imagine an innovative and well-established manufacturing company that needs to expand. Higher demand in the market for its products is stimulating its production capacity. However, a machine can do only so much on its own. The production planning and forecast thus require an increased number of skilled journeymen. To paint a clearer assessment of its requirements, the company conducted a survey of its technical personnel.

The information the company compiled reveals clear results. Limited skilled personnel are available for current production status, many of the skilled personnel are over-aged and the hiring process does not provide replacements in adequate number and ability, short-term temporary workers require more short-term training and the revolving door of temporary workers generates more down-time and loss of quality.

In prior installments of this series on training and education, the prevailing focus has been on the macro level of apprenticeships: background of what they are, who they benefit, why they are beneficial for all parties—mainly the employee and sponsoring employer.

The example company has committed to the concept of a training program. Now, development and implementation of an educational apprenticeship program on a practical, manageable and executable level is paramount. Where does the company go from there?

Outlining basics
Before investments are made, it is imperative the basic nuts and bolts of the apprenticeship program are articulated. For example, the duration of the program for machinists and operators will be 18 to 24 months, accommodating six to 10 apprentices per year. Prerequisites are crucial, as a certain level of basic education, ability and commitment should be brought to the table from the apprentices’ end. In that regard, possible fulfillments should be completed prior to employment, such as employment with another company, pre-training at a technical college for a minimum of a year or a combination of training and education at a college.

When hiring an apprentice, an initial three-month trial period is standard in many work places and is included within the 18- to 24-month duration. Because the training is geared toward the needs of the company, some form of a contract should be established so the company can capitalize fully on the money being invested in an apprentice.

Incentives also should be taken into consideration. It is not uncommon for this component of a contract to get overlooked. Apprentices and employees notice when a company invests in them, which is a great way to foster diligence and company loyalty. Employees can be sensitive about this. When a company is known for hire-and-fire, then employee loyalty cannot be a guarantee. If there are incentives like training, apprentices will realize they can better themselves while feeling confident and secure with benefits and a steady wage.

Company input
A company’s apprentices only will be as skilled as the investment in and execution of a training program. An outlined budget, personnel, equipment, location and content of related training instruction and shop practice must be established beforehand. The availability of grant money for apprenticeship programs should be factored into the budget as well. Specifically, payroll and benefits should be factored in annually for first-year apprentices, the program trainer, requisite amount of equipment and tools, and program curriculum development.

In the second year, the first increase in allocation will be for second-year apprentices, for example. When factored in with an overall, improving, value-added return on investment, the costs will be offset in areas where production contributions minimize downtime. Assuming grants and tax credits for the company have been incorporated, improvements to machines, tools and curriculum will be covered.

State-level departments of labor are a great resource for companies. The labor departments screen the market and provide guidelines for company wages, grants and other concerns—and this is a free service.

There are companies that have difficulty sourcing enough trained workers because, often, companies are reluctant to be innovative in making incentives for employee training programs. The technology, tools and financial resources are available—the next step is for companies to invest in the education and skill development of workers. FFJ

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