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Middle class nailed: Study shows construction apprenticeships rival degrees in earning power

17 January 2020 | By GCR Staff | 0 Comments

A study by researchers in Illinois reveals that the lifetime earnings of unionised construction workers who complete an apprenticeship rivals those who graduate from the US state’s universities.

Despite a higher likelihood of spending time unemployed, a union “journeyworker” – someone who has completed all training – earns around $2.4m in their working lives compared to the $2.5m a person with a bachelor’s degree earns, after student debt.

Although the starting wage after an apprenticeship is lower, at $19.15 an hour, than the average starting wage of a graduate ($26/h), the mid-career wage of a journeyworker tends to outstrip that of a graduate: $40.0/h compared to $35.28/h.

The study was carried out by the Illinois Economic Policy Institute (ILEPI) and the Project for Middle Class Renewal (PMCR) at the University of Illinois at Urbana-Champaign. 

“Every year, thousands of Illinois residents enrol in apprenticeship programs as a tuition-free alternative to college,” said study co-author and ILEPI Policy Director Frank Manzo IV.

“Including up to six years of classroom instruction and on the job training, these programs play a vital role in producing workers with in-demand skills for today’s economy, and give participants the extraordinary opportunity to earn while they learn.”

The revelation comes amid a construction skills shortage in the US.

A survey this month by the Associated General Contractors of America found that three out of four contractors expect to keep adding workers in 2020, but even more respondents, four out of five, reported difficulties in filling positions last year. 

In Illinois, more than 85% of all apprenticeship enrolment is in the construction sector, making the industry’s apprenticeship system one of the state’s largest privately-financed post-secondary institutions.

Of those apprentices, 97% are enrolled in programs administered jointly by unions and contractors (“joint labour-management programs”) which are fully funded by negotiated contributions from employers.

The industry also has “employer-only” programs that are administered by companies or trade associations. Employer-only programs rely on voluntary contributions from contractors.

Analysing data from the US Department of Labor, the study finds that joint labour-management programmes outperform employer-only programmes in terms of training hours and earnings.

“Joint labor-management apprenticeships are clearly the best-in-class model, and are far outperforming employer-only programs on every available measure,” said study co-author and PMCR Director Dr. Robert Bruno. “In fact, the data shows that joint construction programs are delivering a more robust training regimen than other post-secondary institutions, and equal or greater lifetime earnings for their graduates.”

The researchers called for measures to extend apprenticeship programmes, address stigmas that discourage workers from vocational training, more pre-apprenticeship coursework in high schools.

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