Building an evidence base for the business case for apprenticeships

Executive summary

Support for expanding apprenticeships in the United States is growing, but low employer participation remains a significant barrier. Employers interested in apprenticeships often ask, “What’s my expected return on investment?” This report draws on a literature scan and qualitative interviews with subject matter experts and employers to understand the business case for apprenticeships.

Given wide variation in outcomes and inconsistent definitions of apprenticeships in the U.S., aggregate return on investment (ROI) estimates offer limited value to prospective employers. Drawing meaningful comparisons remains difficult. Measuring employer ROI has also proven more challenging than researchers expected. While direct costs and benefits are well established, researchers struggle to quantify indirect benefits (improved retention, reduced hiring costs, better quality) and collect reliable data from employers. Many benefits emerge after program completion, yet traditional ROI formulas focus on short-term returns.

For all the above reasons, intermediaries should avoid relying heavily on aggregate ROI numbers, which can convey false precision about what any specific employer will experience. Rather than asking what the ROI will be, the better question is “under what conditions could my organization optimize ROI from apprenticeships?”  

The good news is that employers and their partners can actively design programs to optimize ROI. Decades of Swiss and German research offer a roadmap, and three insights stand out. First, reduced hiring costs provide a powerful return on apprenticeship investment. Second, aiming to break even before program completion reduces poaching concerns—a key barrier for employers. Third, program design factors profoundly influence outcomes; time spent in productive workplace activities, program duration, and curriculum structure all matter enormously.

We cannot simply transplant international models to the U.S. context. But these insights point toward design principles worth testing: identifying employers positioned to benefit most, helping them design for optimal ROI, and advocating for policies and program features that improve the value that employers derive from partnering with educators and intermediaries.

Building a stronger evidence base on the business case for apprenticeships is necessary to communicate effectively when and why apprenticeships make sense for employers. That will require more foundational research and better data infrastructure, including shared definitions, standardized metrics, and employer tracking tools. Crucially, we need greater consistency in what “apprenticeship” means in order to enable meaningful comparisons. But we can’t wait for perfect data.

This report presents a framework for iterative learning: pilot program designs, gather data, refine approaches, and build better tools. Priority research areas include rapid-cycle testing of program design features, comparative analysis of the costs and benefits of different talent pipelines, and more systematic, industry-specific studies of how apprenticeships create value for employers.

We can build on international evidence to generate theories, develop comparative research, and learn from their data collection strategies and methods. Three key findings from our interviews and literature scan are:

1. A positive ROI for business is possible, but not universal—and there are multiple paths to a business case.
2. The biggest benefits are often hardest to measure, so ROI alone may not be the best metric to capture the actual business case.
3. We need better evidence, but we can’t wait for perfect data.

The report concludes with recommendations for intermediaries, policymakers, funders, and employers to build the evidence base of what works for employer ROI iteratively over time. Intermediaries should focus on identifying which companies can benefit most, what design features improve employer ROI, how to make sure employers are not taking on unnecessary costs, and providing insights to educate employers about how to optimize the value employers get from participating in apprenticeships.

In short, instead of asking “what’s the ROI?”, ask, “Under what conditions can firms get a positive ROI?” and “What types of firms have the most to gain from apprenticeships?” Focus on breaking even by program completion to protect against poaching. Additional benefits accrue over time—measurable or not. Tailor messaging about the business case to the pain points of specific firms; apprenticeships are not right for every firm, but they are starkly underutilized in the U.S. as a talent strategy. Expanding the participation of employers in the apprenticeship system also means expanding opportunities for American learners and workers.