Do apprenticeships raise short-term earnings? Evidence from the American apprenticeship initiative

Abstract

In 2015, the US Department of Labor (DOL) launched the American apprenticeship initiative (AAI) to expand registered apprenticeships in the United States. This paper examines the short-term earnings growth of apprentices participating in AAI compared to the earnings growth for comparable workers during the same period. AAI apprentices initially earn less than comparable workers, but catch up early in the apprenticeship, and ultimately earn more than comparable workers. AAI apprentices' quarterly earnings increased 43% from quarter 4 before the start of the apprenticeship to quarter 10 after starting the apprenticeship, whereas comparable worker quarterly earnings increased by 16%, a 27% age point difference. All demographic groups experienced similar patterns. They began their apprenticeships with lower earnings than comparable workers in the same subgroup but increased their earnings at a faster pace through the apprenticeship and eventually earned more than comparable workers.