Mardy Leathers, Executive Director of Apprenticeships for America: Reinvigorating a Proven Strategy for Workforce Development

Van Ton-Quinlivan: Welcome to WorkforceRx with Futuro Health, where future-focused leaders in education, workforce development and healthcare explore new innovations and approaches. I’m your host, Van Ton-Quinlivan, CEO of Futuro Health.

Many of our previous WorkforceRx guests have cited apprenticeships as a powerful tool to deploy as the US struggles to produce the workers it needs, and the idea is catching on according to the most recent data available from the Department of Labor.

Today, we’re going to take a closer look at how these programs work, what they do for learners and the economy, and what barriers remain to their growth with Dr. Mardy Leathers, the new executive director of Apprenticeships for America. Dr. Leathers most recently served as director of the Missouri Division of Workforce Development and brings nearly two decades of experience in workforce policy and practice to his role at a time of increasing national attention on the importance of work-based learning.

Thanks so much for joining us today, Mardy.

Dr. Mardy Leathers: Thank you so much for having me, Van.

Van: Absolutely. Why don’t we start by having you give us an overview of Apprenticeships for America and making your best case for why we need more apprenticeships?

Mardy: Well, at the end of the day, we’re focusing on broadening economic prosperity for all Americans. We think that we can best do that through the dignity of work. Across the country, it’s no surprise that we continue to have a hard time matching employers to workers and identifying the necessary skills needed for the workforce of the future, but also maintaining the workers that we have now. Apprenticeship programs are designed to do just that. They’re great at upskilling, they’re great at supporting incumbent workers and they are great at preparing people as they enter the workforce and emerge into the workforce.

So, apprenticeships and Apprenticeships for America are really focused on that. How do we attack the skills shortage? How do we address the demographic changes that are leading to an older workforce with fewer younger members entering the workforce and then skilling and training those up to ensure that they can be productive and resilient in any economy, in any sector, and in any headwind might come their way?

AFA is really focused on driving that growth through an expansion of intermediaries. These are organizations that work with employers directly to design and register apprenticeship programs, but then navigate and support apprentices. They recruit and find apprentices; they then support them throughout the entire journey of their apprenticeship; they work with employment and training providers to deliver training; and they align the support services necessary to ensure everything from work supplies to training supplies to transportation and other types of supports are there for them. So, AFA is really here to say we should scale and grow apprenticeships because they help people go to work and stay at work.

Van: Mardy, I was wondering if you could give us some fundamentals. What criteria makes a trainee become an apprentice? And there’s also a difference between a registered apprentice with a big “R,” big “A,” and an apprentice with a little “a.” I was wondering if you could just kind of give us a little bit of a tutorial on the gradations here.

Mardy:  That’s something in the US that our market is beginning to work out. The market in the US for apprenticeships is rather new and evolving. I’ll say that apprenticeships have certainly been around a very long time. We first passed the National Apprenticeship Act in 1937, but we can see apprenticeships going way back before then in the US.  Certainly, if you look at it internationally, they go much deeper. But kind of this formal process that we have around registration is really about assuring quality and identifying the standards that an individual will have that gives them that transferability and that kind of national mobility. That’s really been written on kind of the premise of the way things used to be in the US.

Brookings did a study back in 2019 that identified eighty-four occupations that could be “apprenticeable” meaning they qualify and are a great match for apprenticeships today. That certainly means supporting the skilled trades, but it doesn’t mean just the skilled trades. It means working across health care, working across IT, finance, education, advanced manufacturing, cosmetology apprenticeship programs.

If we get back to the root and core, the idea is occupational mastery of skills by working through and under the mentorship and the leadership of others, and that’s done on the job in the workplace. In the US, unfortunately, our mindset has really been bifurcated. You have to become educated in a silo and then go to work in a different silo. We’ve also made that kind of linear instead of having more of a continuous cycle, where I have to do this by a certain age point and then I go off to work and then I’m on my own.

I think that what apprenticeships and what this movement has done is begin to kind of debunk that a little bit. Lifelong learning is a real thing. You can go back to college, you can go back to pursue higher education and other credential programs as an apprentice or as a journey person who’s completed an apprenticeship program. We can have multiple levels to apprenticeship programs, meaning I completed an apprenticeship and then I start a new apprenticeship or a different level of apprenticeship.

So, just reframing our thinking…that comes back to that concept of a Registered Apprenticeship versus a non-registered apprenticeship at the core. A Registered Apprenticeship is one that has been registered in a state or national level through either a state council or through the National Department of Labor, and they have a couple of tenets. The biggest tenets are that they have at least 2,080 hours of on-the-job training and 144 hours of related training instruction. Most of the standards and work process schedules are designed much longer than that, but that’s the baseline.

But what we have, Van, is many programs that have been designed that are great training programs, but they may not quite be twelve months or 2,080 hours. Maybe they’re 2,000 hours, maybe they’re 1,500 hours. And the argument is if the market says this is what’s acceptable for those individuals and we can somehow measure quality and maintain quality, should we call it an apprenticeship program? That’s where the big “R-A” and little “r-a” kind of come into play.

At Apprenticeships for America, we believe in maintaining quality. We want to reduce barriers while maintaining quality. We do look at registered models for us. We want to help the non-registered programs see the pathway to be registered. If you’re a nine-month program, what can we do to make that a twelve-month program? Not just because that gets you the standards, but then what other type of training or type of experiential learning or competency development might be necessary to do that. So we see those as really kind of key opportunities to get past the “is it registered or not registered” question. Does it maintain this national industry standard of quality that certainly supports the apprentice and meets the needs of the employer?

Van: And, Mardy, isn’t there also a wage element to a formal registered apprenticeship program?

Mardy: You know, there really is, and that’s so the industry and sometimes the government sector that might be investing in the program has kind of a wage floor. We call it a principal wage. Sometimes that might be seventy or eighty  percent of the wage paid to someone who has already shown occupational mastery of the skill or has what we call knowledge, skills and experiences that would pay kind of market rate.

But, you know, what’s interesting about our job market today, Van, is we’re seeing a lot of the principal occupations being paid at market wage — meaning we’re seeing those actually being paid at the market level — regardless of someone’s background. Companies are seeing the value and the opportunity to lean in and to take on someone who maybe doesn’t have all the skills or years of experience or formal education that might have been required in the past, but might have a good chunk of that and they feel that they have the right character and they can work with that individual and help that individual get to the end, kind of get to the mastery piece. And so with that, we’re seeing that shift on market wages.

A lot of the programs, though, are designed to create sustainable wages. That’s a very important part of registered apprenticeship, a very important part of maintaining quality. You know, the concept of helping citizens go to work and stay in work and build resiliency in this life of economic prosperity…that can’t happen if you’re not having a wage discussion. I think apprenticeships are really aligned to do that.

Van: Mardy, talk to me about the apprenticeship from the experience of the individual. How does someone become an apprentice and then what are their obligations through the journey of going from a novice to mastery?

 Mardy: That’s a great question. I’ll say at the outset, we almost make it too hard, right? The idea of how do I access an apprenticeship program? How am I aware of the opportunities that are out there? I was state director of workforce development for five years in Missouri. We launched the Missouri Office of Apprenticeship and Work-Based Learning and registered 30,000 apprentices over a three-year period. But what we found is just when we thought we had communicated enough and made increased awareness and communicated the value, there still were hundreds and thousands that didn’t know about the opportunity.

So, first and foremost, I think the big key is working with sectors and local communities and regional groups — whether the community colleges, local workforce boards, for profits, nonprofits, certainly the intermediaries leading that work with them — to increase awareness and to increase opportunities for access.

So, if I want to be in a different type of sector, say it’s I.T., then I should be able to go to my local job center or my community college or the employer should know where to navigate me to so I can access the resources to become an apprentice, just as traditionally I could go to a union hall, which is a great pathway for some. In some of these kind of apprentice market centers, a lot of it can be done virtually, but knowing where to find it is half the battle. There’s some great work out there happening with intermediaries where they’re doing this.

One of the things, though, to think about is when you have that conversation of ‘let us recruit you as an apprentice and bring you into a program’ the key is the employment match. You’re not an apprentice if you’re not employed. That’s kind of the bar one standard of an apprentice. Now, how you might become an apprentice — is there a front loaded Related Training Instruction (RTI), and there’s some technical stuff there — but if you’re an apprentice, you shouldn’t have to figure that out, right? That’s where the support teams at the intermediaries are there to kind of help you navigate.

The idea, though, is you’re being connected to an employer day one and it’s an employment relationship first. As an employee, then you’re being invested in and developed as an apprentice as you work to occupational mastery or become that journey person. So, that means this conversation around access as we engage more employers, we need employers to understand the model as well. Because if I apply for a job, there should be an opportunity there where the employer says, ‘here’s how I connect you as an employee or as a prospective employee to apprenticeship.’

Van: So, if I’m searching an employer’s web site, would that position say, ‘this is an apprentice position or it is in an apprenticeship training program?’

Mardy: That’s the challenge right now. You wouldn’t know unless the company has leaned into it and has said that. And so that’s part of increasing the awareness is getting that information out front and helping companies understand that this is actually a recruiting tool for you. If you put out front that this position is tied to an apprenticeship, that creates great value. That’s part of the movement, part of the conversation that we’re having is to help employers do that and lean into that.

Van: You’ve alluded to increasing awareness that this methodology, this workforce development tool, is fantastic for recruiting, but also for systematically moving people upwards and building their skill sets. What are some other barriers that are in the way of adoption?

Mardy: You know, funding is always a real thing. As a former policy person, the first thing you hear is ‘we don’t have enough money.’ And the reality is, we may have enough money, but the money may not be available to do the right things or in the right areas. It’s this concept of the color of money. ‘I can only use it for these things, but there’s all of this need outside of here.’ So, part of it is, as we transform our systems to be more innovative and more open, we need to have funding in the right places to support the right parts. Yes, that means education and training. Yes, that means designing and developing an apprenticeship program. Yes, that means support services to ensure the apprentice can take advantage of the opportunity and stay in that opportunity. But, you know, also just building the infrastructure in the market across the US. We are well behind our peers in Canada, the UK, all across Europe, Australia, New Zealand.

I’ve had the privilege to go to these countries to talk to these individuals, to learn their systems. And it’s interesting how developed our economy is in the US, but yet how far we are behind in our approach to apprenticeship and work-based learning, skill development schemes, as well as our investment in the US. That’s the biggest thing that we need to do is create more open systems and support and invest in the marketplace. Truly, we see this as a public good. This is a part of ensuring that workers have access to skill development and employers have access to skill talent. That really is a public good.

Van: One of the key strategies for AFA is building and tapping into a national network of intermediaries, as you’ve alluded to. This is an iteration of the strategy that goes beyond banking these programs at, for example, community colleges. So tell us, what’s an example of an intermediary and why this approach would make sense in this moment in time?

Mardy: So, intermediaries are really the groups that are outside the employers and outside of the educational institutions that support the provision of apprenticeships. And AFA has put forward this model of what we call high intervention intermediaries. They really do five things: they source the apprentice; they support the apprentice and kind of manage the apprentice; they connect the apprentice to an employer; they align the funding for the apprentice and then they bring in the training.

Community colleges have often been terrific leaders and partners across the US to lean into and to help build and design apprenticeship programs. They also have been heavily invested in. However, we haven’t seen the same level of investment to non-education entities that are doing this other work. So, if I’m an intermediary, I might be working with a large employer. I’m helping that employer design their apprenticeship program. I’m helping that employer identify the public funding and the training providers or the educational institution who can deliver the standards and the training related to that. I’m also recruiting the apprentice and I’m supporting the apprentice throughout the duration.

That’s a lot of work. And I think that what we want to be able to do is align those three legs of the stool — the employer, the intermediary and the education training provider — to really deliver on an ecosystem of what we would call a high-quality apprenticeship system. And if I may, this is not just something that we’ve thought was a good idea. Again, looking to our international partners, this has been a proven model for multiple decades across the globe.

I’m just back from being a delegate at the International Labor Convention and one of the things we did there is for the first time ever, we passed international quality standards of apprenticeship, meaning inside the labor standards. We now have recommendations for how to design high quality apprenticeship systems across the globe. They call for these very things that we’re saying and they look at the research h and the outcomes of these high performing, heavily mature systems that we’re trying to develop here in the US.

Van: Mardy, you talk about the learnings brought back from other countries on apprenticeship as a model. Well, recently, AFA and Ryan Craig — who’s a co-founder and advises as a board member — you were instrumental in informing a big pot of money in California to the tune of $175 million to create apprenticeship innovation funding for non-traditional programs, and it’s also focused on these intermediaries. Talk about why it is structured differently from prior pots of public funding.

Mardy: We’re just ecstatic about the partnership we have with California Department of Apprenticeship Standards and our partnership with the Irvine Foundation who are helping us pull all of this together. We’re working across California with great groups like the Northern California Apprenticeship Network, the Southern California Apprenticeship Network, Lark in the L.A. region, Bay Area Community Colleges and it’s creating this ecosystem that is able to then help grow and expand the California economy.

To your point, they’ve done something that nobody in the US has done yet. Of the $175 million investment they’ve made over multiple years, they’ve carved out a portion of that to directly invest in intermediaries. What that means is these organizations that we’ve been talking about — that support the provision of apprenticeships that help design recruit apprentices, help support employers…that are really are kind of the customers, if you will, of education and training — those organizations now can be invested in on a per apprentice basis.

We have this concept in finance of Assets Under Management or AUM. We’ve kind of adopted that in AFA as ‘apprentices under management’ referring to these intermediaries that are overseeing and managing and supporting apprentices. The idea is that you can get a rebate of $3,500 per active apprentice in the state of California that’s registered and that’s meant to offset some of your costs.

Now, there also are different funding avenues to invest in the training pieces and work with the local education agencies across California and there are some for different sectors, some wage stipends and some wage offsets. But this investment directly into intermediaries is the first step ever, and we see this investment as a model for the rest of the country to invest in supporting the development and expansion of intermediaries and helping more people access apprenticeship.

Van: Fantastic. It’s great that you’ve introduced that innovation. Now, you were on the ground in Missouri, so I would love for you to share some concrete examples from your time in Missouri in the way of apprenticeship intermediaries that can help businesses bridge the gap.

Mardy:  So, in Missouri, it was really hub and spokes. For those that are in the workforce arena, yes, we pulled down some US Department of Labor state expansion grants. We were fortunate there, but we didn’t have state money so we had to go out and prove the model and we did it with our WIOA money. We used a lot of our fifteen percent, or our governor’s set aside discretionary funds and we invested into apprenticeships really to build a robust intermediary network down in Missouri. We worked with economic development organizations, with chambers of commerce, and with employer associations. We worked heavily with our local workforce development boards, heavily with our community colleges and that allowed us to build the infrastructure that led to more than 30,000 apprentices to be registered.

That number, by the way, is still growing right now. That also meant very close relationships and investment into our labor management organizations…working closely with the carpenters, working closely with AFL-CIO. Well, what we found was by putting money into offsetting the RTI — so, paying for up to about eight thousand dollars of related training instruction and supporting up to ten or fifteen percent of the overall development administration of the apprenticeship program for those intermediaries — we were able to grow and scale apprenticeships across Missouri that then also attracted more apprentices and attracted more employers.

Then that also created more apprentice standards. We created more standards as we had more occupations that we were able to look through. So, you know, I really was proud of that model in Missouri and it wasn’t one that any one entity can do alone. It really does take a village. And  the idea of this collaborative framework around intermediaries is that employers can’t do it on their own and frankly won’t because that’s just not where the value proposition has been for them. But what we do see is that employers are wanting to engage and lean in and if someone can help them navigate the public funding space, navigate the education and training landscape, understand how to recruit and attract apprentices and register the programs, then employers are much likely to lean in and then also invest on their own.

Van: Given your background and experience and actually practicing the playbook for apprenticeships, let’s look at the national level. Several bills have been introduced in Congress in recent years to give apprenticeships a boost. Are you supporting any particular bill or do you have any wish list that we should focus on?

Mardy: (laughs) We certainly have a wish list and we’re really grateful for the conversation and the momentum around apprenticeship, both nationally at the state level. Let me be very clear: most of the innovation and investment is happening at the state level. States have just leaned in and said this is something we can do. And it’s bipartisan. It’s across the board and everyone agrees to it.

Dr. Bob Lerman, one of our chairmen and our founder, he talks a lot about, you know, it used to be for years that we had to convince everyone ‘why apprenticeships.’ We’re no longer doing that. Now we’re talking about ‘how apprenticeships.’ We may not all agree on the how, but at least we agree on the why. At the national level, in 1937, we passed the National Apprenticeship Act. Unfortunately, it hasn’t been reauthorized or updated since then. Anything that has been around that long needs to be aligned to the market and things that change in our economy. There was some effort in 2021 that failed. It’s back up now.

I bring that up because the National Apprenticeship Act that’s been reintroduced in the House and the Senate is something we’re actively involved in, both on the House side — working in a bipartisan way with the Committee on Education and the Workforce — and then with the HELP Committee on the Senate side. There’s also a lot of focus on school-to-work and youth apprenticeship expansion, defining what youth apprenticeship is, and understanding how we can design frameworks for youth or school to work apprenticeship programs for individuals in secondary education to take advantage of opportunity.

You know, we’ve seen this interesting quick sidebar here at the state level. We’re seeing a lot of states and local districts, especially in rural America, move to four-day school weeks, and they’re doing this really because of budget challenges, but also because of recruiting constraints to find teachers and talent. Well, for apprenticeships, that actually creates opportunity because now that fifth day becomes an opportunity for work experience, an opportunity for other engagement.  Yes, we know the athletics groups are going to use it for practice and we’re going to help make sure that we have good sports teams at our high schools, but let’s have good working relationships with our local communities and let’s be preparing for the future of our workforce on that fifth day as well. So, those are the kind of things that we’re having conversations around.

Apprenticeships for America really has two key priorities: one is to expand and fund the pay-per-apprentice model which invests directly into intermediaries on an outcome basis. If you have an apprentice and you manage that apprentice, then, you know, you’ll be funded and there’ll be a rebate to you to support some of the costs that you have in that apprentice. We’re also focused on maintaining quality while reducing barriers. This is the conversation really around national and state level registration and working across occupational sectors and working with local leadership as well as national leadership to understand how we might improve and streamline the process.

The reality is right now, in many cases, it may be that you have to register your program in fifty states and six territories. So, you might be learning how to do this fifty-six times or you might even have to be learning how to do it 24 times. But either way, that’s more than three or four times or one or two times and that creates a barrier.

So, how can we get some national standardization around really what registered apprenticeship can be, what the process for approving and maintaining quality is and letting it be market driven? I think the end of the day, we want to see a market driven approach. So, again, our two priorities are around reducing the barriers and maintaining quality, and investing in the pay per apprentice model.

Van: You mentioned “how apprenticeship” not just “why apprenticeship.” So, if I’m an employer listening and I want to really get into the “how,” how can they learn more and get involved? And if I’m an intermediary listening, how can I get started?

Mardy: First thing, if you go to Google or Bing or whatever your platform is and you just type in Apprenticeships for America, you’ll be able to go to our website. There’s a lot of great resources there, and that immediately will connect you into a network over 300 organizations — government organizations, nonprofits, for profits, community-based organizations and intermediaries — that are in this space.

Our focus is to build the market in the US that creates a thriving ecosystem for apprenticeship. We think that’s necessary if we’re going to achieve our goals to have five or six million apprentices. We’ve seen a lot of growth and really we’ve seen significant growth since 2012 with some of the national and state level movements.

We’re just under 700,000 apprentices across the US, but that’s less than .6% of our workforce. And in Australia, New Zealand, the UK — our good partners — they’re at four or five percent of their workforce and those occupations are engaging in apprenticeship. The US has a long way to go and so I think that we see the value there to kind of push that forward.

Van:  On a final note, you mentioned the UK, Europe and Australia and that we’re really playing catch up. They’re at four to five percent and we probably don’t even register one percent. Any final thoughts on what we need to do in the US in order to catch up?

Mardy: The first thing is work together. There’s room in this space for everyone. Having a competitive stance internally is going to help us. I think that part of this and part of the spirit of Apprenticeships for America and why we’re even named that is that it’s about pulling everyone together — employers, education & training providers and workforce boards. Building out a robust and thriving ecosystem of intermediaries that can support apprentices, recruit apprentices and engage in apprentices is extremely vital. At the end of the day, employers need to partner because there is not an apprenticeship program without an employer, so it does take the leadership of employers.

We want to continue to elevate the conversation, increase awareness, advocate for systems change and funding and investment in the right places and really cultivate and expand the evidence-based models around how apprenticeship can be impactful.

Van: Well, I greatly enjoyed having your energy and expertise on this podcast today. There you have it. We had Dr. Mardy Leathers with us today sharing his insights and expertise. Thank you, Mardy.

Mardy: Thank you, Van.

Van: I’m Van Ton-Quinlivan with Futuro Health. Thanks for checking out this episode of WorkforceRx. I hope you will join us again as we continue to explore how to create a future-focused workforce in America.