McDonald’s announced plans last Wednesday to give $2 million to non-profit organizations working to build skills and improve employability among young people in Chicago, where the fast food giant is headquartered, the Chicago Tribune reported last week:
In Chicago, about $1 million for pre-employment training will be split among Phalanx Family Services, based in West Pullman neighborhood; After School Matters, situated in the Loop; Central States SER, a workforce development nonprofit in Little Village; and Skills for Chicagoland’s Future, which began as a career training program through World Business Chicago with support from Mayor Rahm Emanuel. Those nonprofits, vetted and selected by the International Youth Foundation, McDonald’s partner in the initiative, will teach soft skills like communication, problem solving and anger management.
An additional $1 million will go solely to Skills for Chicagoland’s Future to support a new two-year apprenticeship program at City Colleges of Chicago that will allow students to earn associate degrees in business for restaurant management jobs, the company said. That program is intended to build careers for young people, specifically at McDonald’s.
David Fairhurst, McDonald’s executive vice president and chief people officer, told the Tribune that the company was making this investment in an effort “to be a good neighbor.” McDonald’s moved its headquarters to central Chicago’s West Town neighborhood in 2016, trading its original suburban campus in Oak Brook, Illinois for the former site of Oprah Winfrey’s Harpo Studios.
The initiative announced last week is not the first investment McDonald’s has made this year in workforce development: In March, it expanded its Archways to Opportunity employee education program, increasing the value of the benefit and making it available to employees after just 90 days on the job. The company has committed $150 million to the program over the coming five years.
One of the innovations in organizational learning and development promised by the UK’s apprenticeship levy scheme, which came into effect last year, was that it would enable employers to apply the apprenticeship model to professional and managerial roles in addition to its traditional use in skilled trades. As of last October, however, official figures showed that only half of companies eligible for levy funds were using them, and often on training programs other than apprenticeships, such as sending their executives to earn MBAs.
Personnel Today’s Rob Moss highlights some new research from ILM that investigates how HR decision makers in the UK are applying their training budgets, which turned up one possible reason why few organizations are approaching management training through apprenticeships: 58 percent of respondents said middle and senior managers would be unwilling to be seen as an apprentice due to the “reputation and image” of apprenticeships and the implication that they require additional support:
Professionals’ reluctance to be seen as an apprentice could be putting businesses at a significant disadvantage. Of those surveyed who currently run a formal leadership training programme to help fill middle and senior management or leadership roles, over two thirds (70%) aim their programmes at mid-level employees. Yet only a quarter (25%) would consider using apprenticeships to improve the skills of middle managers, and 21% would consider using them to develop senior managers.
Home improvement retailer Lowe’s has announced a partnership with Guild Education to offer up-front tuition payments for employees to enroll in training programs for skilled trades such as carpentry, plumbing, and appliance repair, Amanda Eisenberg reports at Employee Benefit News. According to the Bureau of Labor Statistics, the rate of demand for these types of services is growing faster than the supply of talent, with a gap of around 500,000 skilled tradespeople projected by 2026, Eisenberg notes.
The program, which will launch with a four-city pilot in March, will offer employees up to $2,500 to enroll in pre-apprenticeships for those crafts. During that period, ranging from six to ten months, they will have access to a field mentor; afterward, they will have the opportunity to be placed in full-time paid apprenticeships within Lowes’ nationwide contractor network. The company’s Chief HR Officer Jennifer Weber told Eisenberg more about the program, which is called Track to the Trades:
“The trade profession is a high-demand, high-opportunity field for the next generation workforce, and today, there is a massive unmet need,” She said. … “With Track to the Trades, we are providing unique career alternatives for our associates while also building a pipeline for the next generation of skilled trade workers.”
The number of apprenticeships begun in the first quarter of the current academic year in the UK fell by 26.5 percent over the same quarter last year Ashleigh Wight reports at Personnel Today, reflecting the disruption that has been ongoing as employers adjust to the controversial apprenticeship levy introduced last April:
The Department for Education (DfE) said that 114,400 people began an apprenticeship in the first quarter of 2017/18, which was down from 115,600 for the same period last year. The DfE suggested that the introduction of the levy would have an effect on apprenticeship take-up as the new approach beds in. A total of 67,200 levy-supported apprenticeships have begun so far, of which 41,600 started in the first part of 2017/18.
Supporters of the levy say these anticipated declines are merely growing pains and that apprenticeships will bounce back as employers become familiar with the law. Critics, however, say the new system is unworkable for many employers:
Seamus Nevin, head of policy research at the Institute of Directors (IoD), said the new system had failed to take off as it was difficult to navigate. He said: “Apprenticeships are a fantastic type of training for someone new to a job – and it is great to see there was an increase in the number of higher level apprenticeships this year – but employers have made it clear that this type of training is not always the most appropriate way of helping to up-skill someone already in work.” …
The number of people starting apprenticeships in England declined by 59 percent in the final quarter of the academic year, May–July 2017, to 48,000 from 117,800 in the same quarter of last year, Rob Moss reports at Personnel Today based on new figures from the UK Department for Education. While not unexpected, the decline underlines the rocky start that has befallen the UK government’s controversial apprenticeship levy scheme, which went into effect in April. Both union and industry leaders suggest to Moss that the levy has been making apprenticeships more difficult to organize:
In the lowest level training schemes, intermediate apprenticeships, the number of starts fell by 75%. Tony Burke, assistant general secretary at Unite, said the trade union had concerns about the lowest grade of apprenticeships and whether these were beneficial. He added that there was “a great deal of frustration” with the new scheme. “Some businesses view this as a disaster. The levy has made things more complex so they are not taking apprentices on,” Burke said.
In its 2017 Young Workers Index, PwC surveyed the economies of the 35 OECD member countries, creating an indexed ranking of the countries’ expected productivity from younger workers. Switzerland, Iceland, and Germany, were the top three, while the US finished 12th and the UK landed in 18th: both moved up two spots from last year’s rankings.
Germany’s result is probably the most impressive given that it also has the fourth-highest GDP in the world. The US has the world’s largest GDP while the UK is fifth in the measure of economic productivity. France, which stands sixth in GDP, was ranked 29th in the Young Workers Index while Canada, with the world’s 10th-largest GDP, was ranked sixth.
The study also looked into the effects automation will have on job prospects for workers in this age cohort. It found that 39 percent of jobs for US workers aged 15-24 are at risk of being lost to automation, compared to 24 percent in Japan, 28 percent in the UK, and 38 percent in Germany.
One of the metrics tracked in the Young Workers Index, the NEET (not in education, employment or training) rate, is identified as a key metric for overcoming the risks of automation and driving growth. The study claims that if all 35 of the OECD countries lowered their NEET to that of Germany (9.3 percent), it would lead to $1.2 trillion in GDP growth. For the United States, it predicts a $428 billion, or 2.2 percent, rise in GDP by lowering NEET from 15.8 percent down to Germany’s level.
Only about half of the companies eligible to use funds from the UK’s apprentice levy, which came into effect this April, to pay for training programs have taken advantage of this option, the latest official figures show. And this is raising concerns that businesses may be “writing off the apprenticeship levy as a tax,” Emily Burt writes for People Management:
Just 10,500 apprenticeship service accounts were registered on the system at the end of August, according to the official figures, falling short of the estimated 19,150 levy-paying companies eligible to use the service. …
Elizabeth Crowley, skills adviser at the CIPD, said the government must do more to make sure employers were actively engaging with the levy: “In our view the government needs to be doing more work to ensure employers are making a choice in not using the levy, instead of being unaware of it. It is equally important that if there is an underspend, the funds are ring-fenced and used for supporting employer training, as there is a danger it could simply go back into the government’s coffer, and not be used to increase skills training and investment in the UK economy.”
Among those organizations that are using apprenticeship levy funds, many are using them in unexpected ways.