Will Trump's New Executive Order on Apprenticeship Programs Do Anything for the Middle Class? - Pacific Standard

Will Trump's New Executive Order on Apprenticeship Programs Do Anything for the Middle Class?

At least one economist is skeptical.
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President Donald Trump hands over the pen he used to sign an executive order on the Apprenticeship and Workforce of Tomorrow initiatives on June 15th, 2017.

President Donald Trump hands over the pen he used to sign an executive order on the Apprenticeship and Workforce of Tomorrow initiatives on June 15th, 2017.

As part of the administration's "workforce development week," President Donald Trump signed an executive order on Thursday focused on increasing the prevalence of apprenticeship programs in the United States.

"We will be removing federal restrictions that have prevented many different industries from creating apprenticeship programs," the president said in a speech at the signing ceremony. "We have regulations on top of regulations ... so we're empowering these companies, these unions, industry groups, federal agencies to go out and create new apprenticeships for millions of our citizens."

The order calls for federal agencies to review and streamline existing job training programs, establishes a task force to study ways to promote apprenticeships, and directs various departments of the federal government to expand and promote apprenticeship programs. The order also notably directs the secretary of labor to "consider" regulations that would encourage third parties—labor unions, trade and industry groups, businesses, etc.—to develop their own "industry-recognized apprenticeships," although those programs would still be subject to review by the Department of Labor (DOL). The administration is also calling on the Department of Labor to increase funding for apprenticeship programs to $200 million (from $90 million) by re-allocating funds from other programs.

"I'd be surprised if this is enough to dramatically raise employer take-up of apprenticeship."

"The Department of Labor to date has been very prescriptive and very restrictive on the apprenticeship programs, but the DOL is not an expert as to various individual sectors and what the qualifications are," a senior White House official told Politico. "So we're going to let the industry put forth its proposals as to what should make up a high-quality apprenticeship program. But the DOL still sits over and above it and still adjudicates it at the end of the day."

Apprenticeships are both popular and effective. Research shows they increase earnings, and politicians across the political spectrum support policies to increase their prevalence. But the use of apprenticeships in the U.S. has historically been limited: According to a 2014 report from the Hamilton Project, apprentices constitute only 0.2 percent of the U.S. labor force. (For comparison, they make up 3.7 percent of the labor force in Germany.)

Harry Holzer, a Georgetown University economist who studies workforce development and spoke with Pacific Standard earlier this week for a story on apprenticeship programs, remains skeptical that these regulatory changes would have a dramatic effect on the prevalence of apprenticeship programs in the U.S.

"I'd be surprised if this is enough to dramatically raise employer take-up of apprenticeship," Holzer writes in an email. "But we'll see if other efforts to market them to employers are now more successful, because employers think the regulation has been reduced ... we get to test that hypothesis with the data."

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