There is no conflict of interest.
Highlights
- The study’s objective was to examine the return on investment from construction apprenticeship training offered by joint labor-management programs in Minnesota.
- The study used state data on apprenticeship programs, American Community Survey data, and publicly available IRS forms to assess costs and benefits of registered apprenticeships in construction.
- The study found that for every dollar spent on construction apprentice training through joint labor-management programs, there was a long-term state GDP return of $20.73
- The study used estimates and assumptions about the earnings effects of apprenticeships based on American Community Survey data, so its findings are only estimates and not applicable to other occupations or states.
Intervention Examined
Features of the Intervention
Registered Apprenticeship Programs (RAPs) provide participants with on-the-job training combined with classroom instruction tailored to meet employer requirements and offer an alternative career pathway for those who find college education unappealing. Most apprenticeships in the construction industry are based on both time and competency. They typically take about four years to complete but can range from one to six years. In Minnesota, many apprenticeships are in construction. These programs are funded by private groups such as employers and labor unions, which create their own qualification standards.
Features of the Study
The study assessed the return on investment for apprenticeship training. Apprenticeship program data were collected from the Minnesota Department of Labor and Industry for fiscal years 2014 to 2017. Financial information about the organizations managing active apprenticeship programs were obtained through the publicly available IRS Form 990s. Data from the American Community Survey (ACS) for the years 2014 to 2016, provided by the Census Bureau, were used to estimate the effects on earnings in the construction industry. There were 33,106 active construction apprentices during the period of observation of which only 6.1% were female and 23.8% were people of color including Latinos. Most apprentices overall were enrolled in joint labor-management apprenticeship programs. There were only a few hundred veteran apprentices during this time, 83% of whom were enrolled in joint labor-management programs. To perform the analysis, the authors gathered revenue and enrollment data from the 10 largest joint labor-management programs, which represent a significant portion of construction apprenticeships in the state. Using ACS, the authors compared the average annual earnings of young men without post-secondary education in construction to those in other industries. These joint program investments and the earnings impact of construction employment served as inputs for the statistical model.
Findings
- The study found that joint labor-management programs accounted for 93% of all construction registered apprenticeships in Minnesota between 2015 and 2017.
- The ten largest joint labor-management apprenticeship programs in construction averaged 6,676 enrollees and garnered approximately $29.8 million in revenue between 2014 and 2017. This number is 134 times more for apprentices and 100.3 times more in revenue than the leading employer-only construction apprenticeship program in the state. This indicates that joint programs invest more in training than employer-only initiatives.
- Between 2014 and 2016, young men with no post-secondary education in construction earned an average of $11,655 more per year than non-construction employees.
- Investment in joint labor-management construction apprenticeship programs and yearly earnings for construction workers helped maintain or create 1,450 jobs in Minnesota, bringing in an additional $6.5 million in state and local tax revenue within a year.
- A worker's 36-year career contributes approximately $617.1 million to the state GDP. This represents a return of $21 for each dollar invested in workforce training.
Considerations for Interpreting the Findings
When evaluating the results of this study, various factors need to be considered. First, the findings are limited to a single industry in one state within the U.S. Second, one of the inputs for the analysis relies on an estimation derived from ACS data, which only represents a portion of Minnesota's population. The earnings impact related to construction employment is specifically limited to young men, based on the assumption that they constitute most construction apprentices. While this assumption is supported by enrollment data, it might not be entirely accurate as older or female apprentices could experience different earnings impacts not captured in the analysis outputs. Therefore, these findings should be considered as approximations rather than precise measurements and are not applicable across other industries or regions.
Research Guidelines
Review Protocol: Employment and Training Review Protocol
Review Guidelines: Quantitative Descriptive Guidelines