Firms' Motivation for Training Apprentices: An Australian-German Comparison. Occasional Paper

This study investigated how firms in Germany and Australia compare when dealing with the institutional arrangements for apprenticeship training in their countries, with particular attention given to factors which may impact on their training motivation. Apprenticeships are a well-established pathway to employment across many countries, with a particularly long and enduring history in Germany and Australia. Apprenticeships are characterised by a tripartite relationship between employer, apprentice, and training organisation. The available international literature suggests that the institutional framework for training in a country is an important determinant of a firm's motivation to provide training, and it influences their willingness to bear (at least part) of the training costs. Key messages from this study are: (1) Employers of trades' apprentices in both Germany and Australia appear to bear substantial costs for training their apprentices; (2) Institutional frameworks in Germany foster an investment model, a model which emphasises the benefits of employing apprentices after training, while in Australia some firms adopt more of a production (that is, substitution for "regular" workers) model of apprenticeship training, although there is a relatively strong investment motivation for trade firms in Australia; (3) For firms focused on the short-term costs and benefits of training, the withdrawal of some national government incentive payments in Australia has led to a weaker commitment to training, most evident in non-trade trainee places being offered; and (4) By contrast, firms training in trade occupations appear to be more investment-oriented and are more inclined to continue training, or employ an apprentice after training, even with the withdrawal of incentives. Tables and figures are appended.