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An effectiveness assessment and cost-benefit analysis of Registered Apprenticeship in 10 states (Reed et al. 2012)

Absence of conflict of interest: This study was conducted by staff from Mathematica Policy Research, which administers CLEAR. Therefore, the review of this study was conducted by an independent consultant trained in applying the CLEAR causal evidence guidelines.

Citation

Reed, D., Liu, A., Kleinman, R., Mastri, A., Reed, D., Sattar, S., & Ziegler, J. (2012). An effectiveness assessment and cost-benefit analysis of Registered Apprenticeship in 10 states. Oakland, CA: Mathematica Policy Research.

Highlights

  • The study’s objective was to examine the impact of the Registered Apprenticeship (RA) program on employment and earnings.
  • The authors compared outcomes for participants in the RA program with people eligible for the program who did not participate in it. They used Unemployment Insurance wage record data to estimate regression models, controlling for demographic characteristics and pre-intervention measures of earnings and employment.
  • The study found that employment rates were 8.6 percentage points higher among RA participants than those completing none of the program both six and nine years after program enrollment. Average annual earnings were $6,595 higher among RA participants than those completing none of the program in the sixth year after enrollment and $5,839 higher in the ninth year after enrollment. These differences were all statistically significant.
  • The quality of the causal evidence presented in this report is moderate because it was based on a well-implemented nonexperimental design. This means we are somewhat confident that the estimated effects were attributable to the RA program, but other factors might also have contributed.

Intervention Examined

Registered Apprenticeship (RA)

Features of the Intervention

RA is a career-training program that offers on-the-job training, combined with technical instruction tailored to the industry of the job. As participants attain relevant skills, they receive incremental wage increases. Upon program completion, participants earned a nationally recognized certification. At the time of this study, RAs ranged in duration from one to six years, with positions in about 1,000 occupations, such as electrician, plumber, truck driver, child care worker, and correctional officer.

The Employment and Training Administration’s Office of Apprenticeship (OA) within the United States Department of Labor, along with independent State Apprenticeship Agencies, oversees the RA program nationwide. OA recruits employers and employer associations to register and implement apprenticeship programs and to recruit participants. Employers cover the costs of training and wages paid to apprentices.

Features of the Study

Using data from Unemployment Insurance wage records, the authors compared those who had completed the RA program with those who completed none of the program, either because they were eligible but did not enroll or because they were eligible and enrolled, but did not participate in any activities. The authors referred to those who completed none of the program as nonparticipants. The authors estimated the impact of program participation on earnings and employment using regression models that controlled for demographic characteristics and earnings and employment before the start of the RA program. The authors reported outcomes six years after program enrollment for 57,924 people in six states, and nine years after program enrollment for 45,366 people in five states.

Study Sites

  • Florida
  • Georgia
  • Missouri
  • Ohio (included only in the six-year follow-up analysis)
  • Pennsylvania
  • Texas

Findings

Employment

  • The study found that employment rates were 8.6 percentage points higher among RA participants than nonparticipants both six and nine years after program enrollment.

Earnings and wages

  • RA participants also earned more than nonparticipants at both follow-up periods: RA participants earned $6,595 more in the sixth year after program enrollment, and $5,839 more in the ninth year after program enrollment, compared with nonparticipants.

Considerations for Interpreting the Findings

The groups could have differed on unobserved characteristics, such as motivation or skill level. For instance, those who chose to participate in the RA program might have had different motivation levels than those who chose not to complete any of the program. This could have potentially led to bias in the study’s findings. However, the authors controlled for all demographic characteristics and employment history in their analysis, which minimizes the concern about this potential bias.

Causal Evidence Rating

The quality of the causal evidence presented in this report is moderate because it was based on a well-implemented nonexperimental design. This means we are somewhat confident that the estimated effects are attributable to the RA program, but other factors might also have contributed.

Reviewed by CLEAR

July 2016