Apprenticeships, a key source of workers for construction firms, aren’t growing fast enough

After graduating from high school in Bozeman, Montana, Joe St. John didn’t know what to do next, but he knew he wanted to stay close to home.

“My family has been here for a long time, so I’m pretty deeply rooted in the town,” he said. “I would never want to leave Montana. It’s just the most beautiful place. And Bozeman, to me, is the best part.”

His options were limited.

Housing costs have soared as new residents flocked to the area. But few local jobs for young people pay enough to buy a home. St. John said he didn’t even consider college because student debt would take him further from his goal.

That’s where the plumbing apprenticeship at Williams Plumbing came in. Like all apprenticeships, the job pays him while he learns. And when he graduates, the job he trained for will come with a decent paycheck.

For construction firms, apprenticeships like St. John’s are a key source of new workers in a tight labor market. As a result, apprenticeships are growing in popularity with workers as well as employers around the nation.

Amanda Mills, the training manager at Williams Plumbing, said apprenticeships produce more consistent quality of workers who are more likely to stick around. “Employees are saying we are investing in them as a person,” she said.

But demand for skilled construction workers is growing fast as more baby boomers retire. Apprenticeships will need to grow faster than they have in recent years to fill the gap. That faster pace appears unlikely because there are limits to how quickly apprenticeship programs can grow.

Growing numbers of apprentices

Apprenticeships are a form of vocational training that, nowadays, combines training at a workplace with classroom learning. The workplace provides hands-on experience, and the classroom provides broader industry knowledge usually not found in any single firm. The length of training depends on the trade, from two years for a terrazzo finisher to more than four years for a pipefitter.

According to the U.S. Department of Labor’s registered apprenticeship database, the number of new apprentices in construction trades was rising before the COVID-19 pandemic. It fell early in the pandemic but quickly rebounded. In Ninth District states, the number of new apprentices each year now exceeds pre-pandemic levels or is close to it (Figure 1).

Electrical and plumbing apprenticeships are by far the most popular in district states. In South Dakota, for example, those two trades make up nearly 90 percent of apprenticeships. In Minnesota, skilled construction crafts, a category of apprenticeships that include a mix of various skills, and carpentry were more popular.

More importantly for the construction industry, the number of apprenticeship graduates now exceeds pre-pandemic levels in many states. That’s the case in Minnesota and Montana (Figure 2). North Dakota, South Dakota, and Michigan’s Upper Peninsula still lag.

Nick Frattalone, CEO of Twin Cities–based Frattalone Companies and former president of the Minnesota Subcontractors Association, said apprenticeships are the “most important” pipeline of skilled workers for the industry.

His firm, which is involved in excavation and other site preparation work, employs many heavy-equipment operators. In the Midwest, many of the best operators come from a farming background where they would’ve been driving tractors or other farm machinery from a young age, he said. But fewer and fewer people are involved in farming, so it’s harder to find workers with needed experience, he said.

There are other pipelines for skilled workers, but they have disadvantages that make them less popular for employers, according to Frattalone and other industry experts. Training programs that are shorter or lack the close apprentice-mentor working relationship result in less-skilled workers. And hiring experienced workers away from other firms is costly.

More apprenticeships needed

Despite the growing number of apprentices, apprenticeships may not be keeping pace with growing demand for skilled construction workers.

Construction firms continue to struggle to find enough skilled workers, as surveys and industry anecdotes confirm. The recent increase in apprenticeships has not alleviated the labor shortage.

In a recent industry survey conducted by the Minneapolis Fed, 2 in 3 firms that are hiring said labor availability is among their top challenges.

“Labor shortages, especially that of skilled labor tradesmen, continue to be an ongoing problem,” the president of a Minnesota mechanical contractor reported. “There are not enough qualified people. There are not enough applicants of any kind at all.”

The shortage is likely to worsen in the long run.

Based on 2030 government projections of employment in construction trades that usually require apprenticeships, about half of Ninth District states appear on track to produce enough workers in those trades or come close to it.

South Dakota, for example, is projected to require 460 more skilled workers in 2030 compared with 2022. In fiscal year 2022, the state graduated 55 apprentices, a rate that would result in 440 additional workers over eight years.

But construction firms also must replace workers who retire or otherwise leave the industry. In that case, no Ninth District state comes close to what’s needed. Using the South Dakota example, the projections show that by 2030 there would be an average of 1,290 openings each year in trades requiring apprenticeships.

“Baby boomers that made up most of the construction workforce are retiring,” Frattalone said. “Even if you weren’t going to increase your head count within your firm, you’re going to lose a good majority of these 50- to 60-year-olds.”

Barriers to growth

Despite construction managers’ fears that young people today are less interested in construction trades, many apprenticeship programs report not a shortage of applicants but a shortage of openings.

For example, the Minneapolis Electrical Joint Apprenticeship Training Committee, a labor-employer partnership that coordinates apprenticeships, has more than 400 applicants waiting for openings, according to Training Director Derrick Atkins.

High schools are doing a better job explaining education options other than college, he said, but many applicants are older workers. “Our average age is somewhere between 27 and 32. People are looking for a different career, a better career, something that pays better.”

Williams Plumbing in Montana has a kind of waiting list, as well. “We don’t see a lack of applicants. If anything, they’re driving me nuts,” she said, describing how applicants constantly call to ask about the next recruitment drive, which takes place every four to six months.

There are several constraints on the growth of apprenticeship programs.

Apprenticeships are jobs, so the number of apprentices needed is typically based on the labor requirements firms expect two to five years out, the typical training time required to graduate from an apprenticeship. In a way, today’s labor shortage is a result of construction firms not anticipating the construction boom after the start of the pandemic.

Dan McConnell, president of the Minnesota Building & Construction Trades Council, said firms can plan for retirements and hire apprentices accordingly but they can’t plan for future building booms. And most firms don’t want to hire people they might not need, he said.

Capacity is also limited. Apprenticeship programs, especially those registered with the government, are major commitments, and not all firms are able to participate. Firms that can participate are often constrained by state laws that limit the number of apprentices per mentor.

The federal guidelines recommend a ratio of 1 apprentice to 1 mentor, especially industries with higher work-related death rates. Construction is among them. A small number of apprentices are easier for a mentor to keep safe at a job site and to teach. The guidelines recognize, however, that some apprenticeships can still be effective with larger ratios.

Some states have increased their ratios to expand their workforce faster. Montana, for example, went from requiring every apprentice to be supervised by 2 mentors to allowing 2 apprentices to be supervised by 1 mentor in 2022. The state said this ratio is more in line with its neighbors.

That change allowed Williams to double its apprenticeships from 30 to 60, Mills said.

Another constraint is apprentices’ willingness or ability to complete training, which depends on a range of factors, from the quality of training to the apprentice’s expectations to unrelated issues, such as lack of child care.

Completion rates vary by state. Montana, for example, said nearly half of apprentices in construction trades complete their training. South Dakota said it averaged around 20 percent across all programs, with most apprentices quitting in the first year.

“It’s a lot of work and I think a lot of people maybe just weren’t quite aware of that,” said Jeremy Thompson, the apprenticeship coordinator with UA Local 6, which represents plumbers and pipefitters in the Rochester, Minnesota, area. “You may be working an hour and a half away from home and you’re working 10-hour days. And then you’re driving to the training center and you’re coming to class for four hours at night,” he said of his program’s requirements.

In past years, the union has lost as much as a quarter of first-year apprentices, he said. Since the union began explaining challenges up front to prospects, far fewer have quit, he said.

Growing their own

At Williams Plumbing in Montana, apprenticeships are just one aspect of the firms “grow your own” strategy.

Mills, the training manager, said their CEO visits schools regularly to build excitement for construction trades, and the firm has produced some commercials touting the glory of plumbing.

So how do they make appealing a profession that is largely known for being called when something unappealing happens?

“Plumbers are very well paid,” Mills said, and apprentices are essentially paid to go to school instead of paying to go to school, which means no student debt. Once in the door, she said, apprentices also appreciate that plumbing is an essential job. “We’re front lines, bringing sanitary drinking water to hospitals and nursing homes and elementary schools.”

Joe St. John, who recently graduated from his apprenticeship, would agree with all of that. He said he’s had a chance to work on some amazingly intricate plumbing projects involving miles of tubes. But the strongest incentive was the promise of a bigger paycheck that would allow him to remain close to family and friends.

“It’s definitely doable now,” he said.