Making Apprenticeships Profitable for Firms and Apprentices: The Swiss Model

Abstract

The author discusses the success of the Swiss system of apprenticeships. The famous German apprenticeship system requires that firms make an investment in their students, he writes, but the interesting Swiss system makes it possible to recoup such investments by the end of the training period without substantial state aid. High training standards contribute to a significant return on their education for apprentices.

Notes

A policy report and a discussion paper on the topic of the costs and benefits of apprenticeship training will be published in 2016; see also Muehlemann (2016). “The Costs and Benefits of Work-Based Learning,” OECD Discussion Paper, forthcoming. For an overview of the other modules, see http://www.oecd.org/edu/skills-beyond-school/work-based-learning.htm (accessed June 20, 2016).

For an empirical analysis of the demand for apprentices among Swiss firms, see Muehlemann et al. (2007).

The costs to fill a vacancy in Switzerland by hiring skilled workers from the external labor market amounts to about four–five months of skilled-worker wage payments. Moreover, the magnitude of hiring costs positively affects a firm’s demand for apprentices. See Blatter et al. (2016).

Although parents are likely to be a main influence on the educational choice of teenagers, media might also play an important role. In Italy, the increased popularity of the television program “Master Chef” led to an increase in teenagers enrolling in VET in the field of cooking. See Di Pietro (2016).

Governments, however, typically finance vocational schools. Nonetheless, as firms bear some of the investment in training, governments can save a significant amount on educational spending at the upper secondary level. See OECD (2011), 234. For the most recent survey results regarding the costs and benefits of apprenticeship training and the share of subsequently retained apprentice, see Jansen, Leiser et al. (2015).

Many other countries with a dual VET system finance the school-based component of vocational education by setting up public vocational schools. For more information on the Swiss model, see SER (2015).

For details on rates of return on different educational pathways in Switzerland, see SER (2011).

For details on public expenditures in Switzerland by type of education, see “Bildungsfinanzen” (2014).

The study was commissioned by the Bertelsmann Foundation. See Wolter and Muehlemann (2015).

The paper analyzed comparable apprenticeships with a training duration of three years in both countries. See Dionisius et al. (2009).

The authors compared the productive use of apprentices in the workplace before and after the Hartz IV labor market reforms in Germany and compared the change to similar occupations in Switzerland, where no labor market reforms occurred during that time. See Jansen, Pfeifer et al. (2015).

Additional information

Notes on contributors

Samuel Muehlemann

Samuel Muehlemann is a professor for human resource education and development at LMU Munich and a research fellow at IZA Bonn.