Are Apprenticeships Still Relevant in the 21 st Century? A Case Study of Changing Youth Training Arrangements in German Banks

Abstract

The authors present a detailed case study of the evolution of apprenticeships in German banking over the past two decades to analyze why employers continue to be willing to invest in these programs that provide workers with transferable skills. They explain employers' motivation in terms of two “logics.” Some considerations stemming from the logic of consequences, such as recruitment cost savings and enhanced workplace flexibility, encourage retention of the apprenticeship system. On balance, however, the cost calculus that is at the heart of the logic of consequences would, if unopposed, encourage head-hunting for apprentices trained by other firms, eventually undermining the system. The countervailing logic of appropriateness, however, discourages defections from the system by fostering trust among employers, encouraging new firms to participate in the system, supporting the strong reputational effect associated with training, and creating mechanisms with which banks can have a hand in keeping the system efficient.