Apprenticeships: Training without student debt

http://personalmoneynetwork.com/moneyblog/2012/03/21/apprenticeships/

Apprenticeships: Training without student debt

Sorcerer's Apprentice

Apprentices learn a profession without accruing student loan debt. In this case, the profession is sorcery. Image: Loren Javier/Flickr/CC BY-ND

Tuition prices keep going up, and if Congress doesn’t act before July, the interest rate for some federally subsidized student loans will double. The burden of student debt hinders success in the early years of many careers. But there is another way to learn a profession without diving into the debt pool. Apprenticeships are on the rise in the U.K., and that trend may be crossing the Atlantic.

Student loan burden

A college graduate in the U.S. generally leaves school owing $25,000 in student loans. The current 3.4 percent rate on the federally subsidized Stafford loans will go up to 6.8 percent if Congress does not act to stop it before June 31. That will add even more to the student loan burden. Stafford loans are extended to low- and middle-income students.

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Apprenticeships on the rise in the U.K.

Apprenticeships — an on-the-job system of training a new generation of workers in a specific trade — are undoubtedly attractive to many young people in these economically stressed times. In the United Kingdom, where the economy is even more fragile than in the U.S., apprenticeship opportunities are on the rise. According to a report from England’s Department of Work and Pensions, more than 103,000 adult workers took advantage of the programs between January, 2010, and June, 2011

Government-sponsored programs

Many of the apprentice programs in the U.K. are government-sponsored. England’s business secretary, Vince Cable, said in June that the government programs demonstrate “a commitment to delivering the skills businesses need to grow and young people need to build productive careers.”

Washington educators see rise in interest

Northwest Cable News reported Wednesday that educators in Washington state have seen an uptick in students asking about and looking into apprenticeship programs.

400,000 apprentices in the U.S.

According to CBS News, there are nearly 400,000 apprentices working and learning in various trades across the U.S.

Alfred Santana, an 18-year-old sheet metal apprentice in Boston, told reporters:

“Roughly when I get out of my apprenticeship time as a fifth year, I’ll be making 50, 60 grand. It’s also nice not to have student loans.”

Rebuilding the middle-class

Apprenticeship programs, like the one Santana is enrolled in at Boston’s Sheet Metal Workers Union Local Seventeen training center, alternate between Union-paid classrooms and on-the-job training. Generally, the apprenticeship lasts for five years. After that, an apprentice becomes a full-time employee. More such programs in the U.S. could perhaps do much toward rebuilding the middle-class.

Sources

HR magazine
CBS
Northwest Cable News

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Paul Champion
Strategic Project Manager

Mobile: 07540 704920

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