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In a Tight Labor Force, Apprenticeship Programs are on the Rise

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hat is the top corporate concern of senior level executives in the tech industry? It’s not the rapid change in the industry, or growing concerns about digital privacy and protecting customer data. Instead, an internal concern has topped the list.

According to a recent Emerging Risks survey by Gartner, most senior level executives across industries and around the world are worried about a talent shortage. This lack of talent has a ripple effect; businesses can’t take advantage of the latest technology if they don’t have trained people working for them. In a rapidly changing industry like technology, this can mean missing out on business and opportunities for growth.

Areas such as artificial intelligence, online security, biotechnology, and cloud computing are all poised for growth in 2019. However, that growth can’t happen without skilled employees. The current talent shortage in these and other tech spaces are forcing companies to change the way they recruit.

Apprenticeship Programs Are Growing

One way this change is happening is through the rise of apprenticeships. There was a time when apprenticeships were found only for laborers in skilled trades, such as bricklayers or electricians. Recently, tech companies have taken on this model, and are growing and training their own talent.

Apprenticeships Cover a Wide Variety of Industries

Cybersecurity firm Fishtech is just one example. They’ve partnered with a local high school, Summit Technology Academy, to create an internship program that provides specialized training to motivated young people. Interns who successfully complete the program have the opportunity to work for Fishtech right after they graduate.

One way this change is happening is through the rise of apprenticeships. There was a time when apprenticeships were found only for laborers in skilled trades, such as bricklayers or electricians. Recently, tech companies have taken on this model, and are growing and training their own talent.

Technology isn’t the only industry where a lack of talent is a concern. Industries like financial services, hospitality, retail, and the nonprofit sector are also feeling the pinch. One apprenticeship program in South Carolina has expanded from a single manufacturing option to include apprenticeship programs in hotel management, culinary arts, HVAC repair, and computer networking, to name a few. The programs have proven to be beneficial for both students and employers.

Government Benefits Exist for Apprenticeships

There is even federal and state government support available for businesses that are seeking to create an apprenticeship program. In 2017, President Trump put forward an executive order to expand apprenticeship programs, and last year Congress passed the Omnibus Appropriations Act of 2018, which increased federal funding for apprenticeship programs. In addition, states like California, Wisconsin, and Washington have state-funded programs designed to help businesses build apprenticeships.

Right now, there are estimated to be fewer than 500,000 people participating in apprenticeship programs in the United States, which is considerably less than in other developed nations. However, we think this number can only go up as businesses are forced to adapt to a tight and competitive labor force. Technology companies in particular with have to turn to creative solutions to find qualified employees.

2019 is going to bring many changes for both large and small businesses; the rise of apprenticeship programs is just one trend we see becoming prominent this year.

How Can You Prepare?

For the full scope of coming economic trends and how to navigate them, we recommend checking out our Economic Development Trends Report. If you request to download the full PDF version, you’ll also find out how a Fortune 500 company has implemented apprenticeships to strengthen their workforce.

Learn more about our Economic Development Trends Report here.