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ICYMI: AAF Reviews PROSPER Earn and Learn Proposals

WASHINGTON, February 7, 2018

American Action Forum recently conducted a study to examine the apprenticeship grant programs within the PROSPER Act, and how the bill would promote earn and learn opportunities for students seeking good-paying jobs that can lead to a successful career. Here are some of the highlights from their findings: 


Earn and Learn: A Review of a Proposal to Expand Apprenticeships in High-Growth Industries

By Ben Gitis, Chad Miller, and Rahee Jung — Monday, February 5, 2018

“U.S. apprenticeships need to be reoriented to prepare workers for the jobs employers will demand. The PROSPER Act aims to do this by incentivizing participating education providers to prepare workers for in-demand jobs while providing them with the operational flexibility that best fits the local labor market.”

Estimates of Apprenticeship Program’s Effects

New Apprentices

“The bill authorizes $183,204,000 to carry out the apprenticeship program in FY 2019 and each of the five succeeding years, which combined would provide $1,099,224,000 in total federal funding. To gauge the potential impact of these grants, this study assumes that the entire authorized amount is appropriated each year and that the government always awards programs the maximum grant of $1.5 million. Dividing the total authorized $1,099,2240,000 by the $1.5 million maximum grant leads to 733 new apprenticeship programs created between FYs 2019 and 2024.”

“How many apprenticeships could this create?... Assuming that the 733 new apprenticeship programs created by the PROSPER Act also each average 121 apprentices, there would be 88,700 new apprentices between FYs 2019 and 2024.”

“To put the magnitude of the 88,700 new apprentices in perspective, consider that DOL statistics indicate the number of active registered apprentices has only grown at an annual average rate of 1.7 percent since 2008. If the number of registered apprentices increased by 88,700 between FYs 2019 and 2024, that growth rate would more than double to 4.1 percent.”

Employment Expectations

“The apprenticeships created under the PROSPER Act could also lead to an increase in skilled-employment.”

Table 1. Estimates for the number of new programs, apprentices, and the expected employment outcome


Occupation and Industry Distribution

“The PROSPER Act aims to improve upon the current apprenticeship system by encouraging partnerships that receive grants to educate apprentices for in-demand fields.”

“If successful, this would be a major improvement from the current registered apprenticeship system.”

Impact on Earnings

“The apprenticeship programs created under the PROSPER Act would also likely raise the earnings of the workers who participate. Research has shown that those who simply participate in apprenticeships tend to earn more than workers who do not.”

“Given that this bill allows awarded grants to be used to subsidize up to 50 percent of apprentice wages, participants of programs funded by this bill could end up receiving even higher wages than participants in traditional programs. Furthermore, the fact that the bill requires local business and education leaders to design apprenticeship programs for high-growth industries could set up participants for even more accelerated career wage growth.”

Conclusion

“The PROSPER Act could lead to at least 733 apprenticeship programs and 88,700 new apprentices by FY 2024. The operational flexibility given to local business and education leaders combined with the pro-growth requirements from the federal government would encourage states to launch new apprenticeship programs in industries that actually demand workers."

To read online, click here.

To learn more about the PROSPER Act, click here.
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