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States in Midwest investing more in apprenticeship programs

by Laura Tomaka~ January 2014 ~ Stateline Midwest »
Apprenticeships — in which an individual is paid to learn a set of skills through on-the-job training — help meet labor demands of businesses, while offering workers higher wages and better employment outcomes.
A December report by the Center for American Progress analyzed the effectiveness and return on investment for apprenticeships. These programs, the study found, not only generate a high level of satisfaction among employers, but also lead to significant increases in lifetime earnings for workers — as much as $300,000.
The apprenticeship model, however, is not widely used in the United States. According to the Society for Human Resource Management, less than 5 percent of U.S. secondary-school students take part in apprenticeships.
But the model has begun to attract the attention of more state lawmakers.
In late 2013, the Wisconsin Legislature approved two bills that have since been signed into law. One expands the state’s existing apprenticeship program, while the second creates a new tuition-reimbursement program.
With passage of these proposals, Wisconsin joins 16 other states that offer subsidies to students or businesses engaging in apprenticeship programs, according to the Center for American Progress.
SB 336 increases funding for the Wisconsin Youth Apprenticeship Program by $500,000 annually. The program provides on-the-job training and technical, college-level instruction at local high schools. In 2012, the program trained nearly 1,900 apprentices under the guidance of 1,300 employers; 81 percent of the graduates received job offers from the participating employer.
Under SB 331, students or employers can receive partial reimbursement (25 percent of tuition, up to $1,000 per apprentice) of costs related to an apprenticeship program that offers on-the-job training and classroom instruction to meet worker and employer needs.
“Apprenticeship programs have long proven to be successful in providing hands-on skills training in a work environment and have been model programs for other states,” says Wisconsin Sen. Sheila Harsdorf, a primary sponsor of the legislation.
Last year, too, Nebraska, North Dakota and Minnesota took steps to expand internship programs. (According to the National Association of Colleges and Employers, almost six of 10 internships lead to a job offer.)
Minnesota lawmakers approved $2 million for a new tax credit (part of HF 677) for student internships in rural regions of the state. Companies that hire college interns are now eligible for a tax credit of up to 40 percent of the intern’s salary, capped at $2,000 per internship.
North Dakota expanded its Operation Intern program with an additional appropriation of $1.5 million. Nebraska lawmakers opened up the state's Intern Nebraska grant program to all businesses in the state, including nonprofits. They also loosened requirements regarding work hours and the length of internship programs.

 

Article written by Laura Tomaka, staff liaison to the Midwestern Legislative Conference Economic Development Committee. The committee's co-chairs are Michigan Rep. Eileen Kowall and Nebraska Sen. Heath Mello.