The German Apprenticeship System

The German apprenticeship system holds fascination for labor economists, since it is an example of a system in which many companies make substantial net investments in marketable skills. Moreover, although German companies are exhorted from time to time to provide more apprenticeship places, such exhortation is not the rule; and there is no system of sanctions or penalties for companies that do not have an apprenticeship program: a large proportion of companies in fact do not. Nor do companies cut corners with their apprentices: unions and employer associations, with input from the public authorities, bargain out the content of the company part of apprenticeship programs, with the result that the skills are genuinely marketable; the operation of the programs are monitored by both local chambers and by works councils within companies; and successful completion of the apprenticeship requires the passing of serious external examinations.