Vibrant Apprenticeship Schemes Keep Youth Unemployment Down

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In recent weeks we have witnessed the joy and pain experienced by young people (and their families) when the results of the Leaving Certificate and CAO points were published. The heavy emphasis that Irish people place on third-level education was highlighted yet again and those left behind have to struggle with identifying alternative plans. Ireland is quite rightly proud of its high participation rates in third-level education. Indeed, an EU report earlier this year highlighted that Ireland had the highest rate of people between the ages of 30-34 who had successfully completed third-level (51.1pc), which puts the country well above the EU average of 35.8pc. But should third-level education be placed on such a pedestal or should we be looking to ensure that all forms of education and training have equal value to our society?

On the flip side of our success in educating young people, Ireland has a substantial challenge with regards to youth unemployment. According to a recent OECD report, the rate of youth unemployment is 28.6pc; while, at 11.3pc, Ireland has the OECD’s third-largest share of 15-to-19 year olds who are neither employed nor in education or training. These frightening statistics are softened by emigration taking many young people away from the dole queues. In seeking to find a solution to the problem of youth unemployment, it is interesting to look at the countries where youth unemployment is relatively low.

The EU country with the lowest rate of unemployment in 2012 was Germany at 7.9pc. Apprenticeship training in Germany is highly formalised and is provided in about 340 recognised occupations (Ireland only has 26 recognised trades). The duration of the training varies from two to three-and-a-half years and it involves part-time training in companies and part-time education in school. Apprentices receive a training allowance from their company (the average is around €650 a month) and those who successfully complete their training are often employed permanently as a skilled worker by the company.

Another country with relatively low rates of youth unemployment is Denmark, which also has a strong apprenticeship system. Within the Danish approach, approximately two-thirds of the total curricular time is spent on practical training within an enterprise and the remaining one-third on school-based education. In the UK, David Cameron has recognised the importance of apprenticeships and an additional two million apprentices have been added to the UK programme between 2011 and 2013.

The US economist Robert Lerman has argued that apprenticeships could “reduce youth unemployment, improve the transition from school-to-careers, upgrade skills, raise wages of young adults, strengthen a young worker’s identity, increase productivity, achieve positive returns for employers and workers, and reduce government spending”. This vision would require strong public-private collaboration in terms of companies hosting apprentices and second-level schools and third-level colleges tailoring their courses and timetables to suit the needs of the participants. If we look at those countries that possess expansive apprenticeship programmes and who truly value the dual vocational system (company and school) as a competitive alternative to third-level education then surely we can identify a workable system that substantially increases the number of apprentices.

In countries where the system is currently highly effective, much of the cost is borne by the employer as they receive the benefit of having an additional productive employee and generally will recoup their investment. However, asking cash-strapped Irish SMEs to pay for an additional employee might be difficult in today’s environment. Similarly, asking schools and educational institutions to change their work practices to accommodate apprentices might also throw up some challenges but the experience of the British government in successfully rebuilding their scheme might give us cause for hope.

Whatever the challenges, this is an opportunity that we must grasp with imagination.

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About the Author:

Professor Thomas M. Cooney (B.Comm, MBA, PhD, MMII, MCIM, FIMCA)

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