why is the swiss apprenticeship system held in such high regard? introduction dr bill mcginnis cbe,...
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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
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Department of Economics
5 ingredients for a
successful apprenticeship systemStefan WolterCentre for Research in Economics of Education
29.9.2014, Belfast
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Department of Economics
3
APPRENTICESHIP IS NOT FOR DUMMIES
1
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Department of Economics
4
VET for dummiesVicious circle
Low achievers in
CTE/VET
Low engagement
of firms
Low quality of training
Stigmatised form of
education
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Department of Economics
5
VET for all talents2/3 of all students choose an apprenticeship
Source: Swiss Education Report 2014
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Department of Economics
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
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Department of Economics
7
The «US» view of skillsHierarchy of skills
Low Middle High
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Department of Economics
8
The Swiss-German – view:A mix of skills of equal importance
Social-emotional
skills
Vocational skills
General skills
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Department of Economics
9
APPRENTICESHIP IS STEERED BY REAL EMPLOYERS
2
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Department of Economics
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
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Department of Economics
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)
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Department of Economics
12
APPRENTICESHIP PAYS OFF FOR EMPLOYERS
3
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Department of Economics
Cost-Benefit – The simple model
Benefit Cost
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Department of Economics
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
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Department of Economics
Cost-Benefit – The augmented model
Benefit CostApprentices
salary
Trainer salaries
Machinery, tools, etc.
Unskilled work
Skilled work (x productivity)
Reduced hiring costs
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Department of Economics
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
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Department of Economics
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
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Department of Economics
18
A MARKET - WITH A SYSTEM MONITORING
4
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Department of Economics
19
A volatile world needs system-monitoring
Source: Swiss Education Report 2014
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Department of Economics
20
Early decisions with good matches (~ 230 different occupations)
Source: Swiss Education Report 2014
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Department of Economics
21
High levels of satisfaction
Source: Swiss Education Report 2014
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Department of Economics
22
THE COMBINATION OF APPRENTICESHIP AND
ACADEMIC EDUCATION CREATES A WIN-WIN-SITUATION
5
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Department of Economics
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
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Department of Economics
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)
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Department of Economics
Average public costs for VPET training and the share of company based training
Source: Swiss Education Report 2014
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Department of Economics
26
Excellence in all sectors of the education system (if focused)
Source: Swiss Education Report 2010
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Department of Economics
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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