Why is the Swiss Apprenticeship System held in such high regard? Introduction Dr Bill McGinnis CBE,...

Why is the Swiss Apprenticeship System held in such high regard?

Introduction

Dr Bill McGinnis CBE, NI Adviser on Employment and Skills

Office of the Northern Ireland Adviser on Employment and Skills

Department of Economics

5 ingredients for a

successful apprenticeship systemStefan WolterCentre for Research in Economics of Education

29.9.2014, Belfast


3

APPRENTICESHIP IS NOT FOR DUMMIES

1


4

VET for dummiesVicious circle

Low achievers in

CTE/VET

Low engagement

of firms

Low quality of training

Stigmatised form of

education


5

VET for all talents2/3 of all students choose an apprenticeship

Source: Swiss Education Report 2014


6

Compulsory schooling (9 y)

Dual and school based vocational educationUniversity entrance diploma

Academic universities

Professional education

Universities of applied science

How can we attract talents into VET?

VET: the need for permeable education systemsPermeability between

sub-systems


7

The «US» view of skillsHierarchy of skills

Low Middle High


8

The Swiss-German – view:A mix of skills of equal importance

Social-emotional

skills

Vocational skills

General skills


9

APPRENTICESHIP IS STEERED BY REAL EMPLOYERS

2


10

Strength of employers’ influence on content, curricula and jobs

CH DK Aus Fin Swe Aut Bel D USA NL Nor TschR Ung0

2

4

6

8

10

12

14

16

18

Source: Calculations from OECD 2010


11

Employer(s): Collective skill formation vs. single firms decisions

Employers decide on everything, but there is a price to pay

The government never talks to single employers!

Collective skills formation is the condition for:

Common definitions and standards across the industry Long term visions vs. short term interests Quality assurance by peer-review of skills acquisition Portability of skills (labour market mobility) (2/3 of the apprentices

leave their training company after the apprenticeship)


12

APPRENTICESHIP PAYS OFF FOR EMPLOYERS

3


Cost-Benefit – The simple model

Benefit Cost


Per apprentice and year (in

Euro)3 y

Per apprentice and year (in

Euro)4 y

Gross costs 72’012.5 96’391.7Productive contribution

79’273.3 103’380.8

Net benefit 7’260 6’989.2ROI 10.1% 7.25%

Average cost and benefit per apprentice for training firms in Switzerland (2009)

Source: Strupler & Wolter, 2012


Cost-Benefit – The augmented model

Benefit CostApprentices

salary

Trainer salaries

Machinery, tools, etc.

Unskilled work

Skilled work (x productivity)

Reduced hiring costs


Recrutive opportunity benefits per trained apprentice (2009)

1-9 10-49 50-99 >1000

2000400060008000

1000012000140001600018000

Firm size

Real

ised

ben

efits

in U

S$

Source: Strupler & Wolter, 2012


Training companies train because it is profitable – Non training companies do not train because it is not for them

Gross-cost Benefit Net-Cost-10000

0

10000

20000

30000

40000

50000

60000

70000

80000

Training firms

In E

uro

of 2

005

Source: Wolter et al., German Economic Review, 2006


18

A MARKET - WITH A SYSTEM MONITORING

4


19

A volatile world needs system-monitoring



20

Early decisions with good matches (~ 230 different occupations)



21

High levels of satisfaction



22

THE COMBINATION OF APPRENTICESHIP AND

ACADEMIC EDUCATION CREATES A WIN-WIN-SITUATION

5


23

The advantages of a skill mix in an economy

• VET+ academic Education• preserves industrial production and manufacturing and

fosters • «incremental innovation»• as well as quality leadership

Industry/manufacturing


24

Geographical proximity leads to growth and innovation: Myth or truth?

“A growing number of American companies are moving their manufacturing back to the United States - Innovation suffered from the distance

between manufacturing and design, and quality became a problem too.”

(The Economist, 19.1.2013)


Average public costs for VPET training and the share of company based training



26

Excellence in all sectors of the education system (if focused)



27

Summary

1) Apprenticeship training must be attractive also for high achievers

2) Apprenticeship needs collective employers engagement

3) Apprenticeship must pay off in the short run

4) The invisible hand is not enough (monitoring)

5) Apprenticeship is an integral part of the education system generates advantages for everyone

Why is the Swiss Apprenticeship System held in such high regard? Introduction Dr Bill McGinnis CBE,...

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