EOW March 2014

Transatlantic cable

Thomas E Perez, the US secretary of labour, deplores the trend. “As a nation, over the course of the last couple of decades, we have regrettably and mistakenly devalued apprenticeships and training,” Mr Perez said in November. “We need to change that, and you will hear the president talk a lot about it in the weeks and months ahead.” Manufacturing institutes: an alternate method of addressing the attrition in well- paid work in the US industrial sector As South Carolina promotes apprenticeships, a near neighbour is trying a di erent but related approach – also with the strong encouragement of their mutual friend in Washington. In January, speaking to 2,000 students at North Carolina State University, President Barack Obama announced the establishment there of a high-tech manufacturing institute that is, he said, the kind of innovation that will reinvigorate the nation’s manufacturing economy. Centred at the Raleigh campus, the institute is the joint project of a group of universities and companies to address a matter of pressing concern at the education/industry interface: reversal of the e ects of a decade of manufacturing job losses in North Carolina, where the unemployment rate is higher than the national average. “We’re not going to turn things around overnight,” Mr Obama declared in Raleigh. “But we are going to start bringing those jobs back to America.” (“Obama Announces Institute to Create Manufacturing Jobs,” New York Times , 15 th January) The announcement of the new manufacturing institute re ected the White House’s determination to forge ahead with such programmes, with or without the cooperation of Congress. Despite the partisan politics that has all but paralysed the legislative branch of government for years now, Mr Obama said that he is determined to make 2014 “a year of action.” The North Carolina institute was the rst of three that would be announced within weeks. It will be nanced by a ve-year, $70 million grant from the Department of Energy, matched by funding from consortium members including the equipment maker John Deere and the auto-parts maker Delphi. The institute will apply advanced semiconductor technology to the development of a new generation of energy-e cient devices for automobiles, industrial motors and consumer electronics. Earlier in the day of his address to the students, Mr Obama toured the plant of a Finnish company, Vacon, which makes drives used to control the speed of electric motors to increase their energy e ciency. In 2013 the president announced a $1 billion plan, also on a German model (See “Apprentice system,” above), to create a network of 15 institutes that would incubate new industries. But congressional opposition compelled him to scale down his immediate ambitions to the establishment of three, using his executive authority and previously allotted funding. At the same time, he raised his long-term goal to 45 such institutes over ten years. † Mr Obama regularly visits factories, reminding Americans that manufacturing has been a comparative bright spot in the job market over the course of his presidency. But the timing of the Raleigh visit this January was unfortunate, coming as it did days after the release of a surprisingly weak job report for December.

Manufacturing

Inspired by Germany, employers and educators in the American South are

exploring the bene ts of an apprentice system “The European in uence is huge. They are our strongest partners.” Brad Neese, director of Apprenticeship Carolina, which links the South Carolina state technical college system with private companies to help create specialised programmes, was referring to an e ort to introduce a European-model apprentice system to the United States. Inspired by the partnership between industry and schools that is seen as a key to Germany’s advanced industrial capability and relatively low unemployment rate, such projects are practically unknown in the United States. Apprenticeship Carolina started in 2007 with 777 students at 90 companies. It now has 4,500 students at more than 600 companies in the state, with the typical apprentice in his or her late twenties. The goal is to have attracted 2,000 companies to the programme by 2020. To help develop his programme, Mr Neese has travelled to Germany, Austria and Switzerland, where apprenticeships are thriving, youth joblessness is relatively low, and blue-collar work is prized. Business writer Nelson D Schwartz of the New York Times pointed out the contrast with the US, where the economic fortunes of younger people with only a high school diploma have plummeted, and the unemployment rate among workers age 16 to 19 stands at more than 20 per cent. From Greer, South Carolina, where Tognum America has established its North American operations, Mr Schwartz reported on the di culties encountered by the German builder of heavy engines in sta ng a new factory there. Having exhausted the local talent pool after hiring 60 workers – and needing 60 more – the company’s vice president did what he would have done back home in Germany: he set out to train them himself. Now, with a curriculum identical in most respects to the one in e ect at the headquarters in Friedrichshafen – and having enlisted the help of ve local high schools and a career centre in the state’s Aiken County – Tognum has nine high school juniors and seniors enrolled in its apprenticeship programme. (“Where Factory Apprenticeship Is Latest Model from Germany,” 30 th November) According to the Times ’s Mr Schwartz, experts in government and academia, together with those inside companies like BMW – which has its only American factory in South Carolina – say apprenticeships are a desperately needed option for younger workers who want decent-paying jobs; or, increasingly, any job at all. Without more programmes like the one at Tognum, they claim, the nascent recovery in American manufacturing will run out of steam for lack of quali ed workers. † Despite the South Carolina example and the support of President Barack Obama, who cited the German model in his State of the Union address last year, other states have been resistant to the concept of apprenticeship. Since 2008, the number of student trainees in such programmes in the US fell by nearly 40 per cent, according to a report (“Training for Success: a Policy to Expand Apprenticeships in the United States”) from the Center for American Progress, a Washington-based research organisation.

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March 2014