Comparing Modern Apprenticeships and industry training

5.1. Conclusions

This study controls for differences between (and within) Modern Apprenticeships and industry training to answer the following questions:

1. Do Modern Apprentices complete their programmes at similar rates to industry trainees?
2. Do non-European Modern Apprentices do better or worse than in industry training?
3. Do learners chances of success differ according to who provides coordination services?

In summary, this study found:

1. When other factors are controlled for, there seems to be a premium in the Modern Apprenticeships model over normal industry training, manifested in overall programme completion rates. On aggregate, learners engaged in Modern Apprenticeships are more likely to complete their programme than equivalent learners in industry training.
2. This is not true in all industries. Modern Apprentices completed their programmes at higher rates than equivalent industry trainees in just over half of the matched ITOs. There may be industry-specific factors and/or programme administration factors that mean that the Modern Apprenticeship model works better to provide a completion premium in some industries over others.
3. There does not appear to be any premium on completion between industry training and Modern Apprenticeships when combined with the ethnicity of the learner. When other factors are adjusted for, each ethnic group performs relatively similarly between the two programmes.
4. When other factors are adjusted for, there appears to be no difference in coordination effects based on the identity of the coordinator (ITO coordinators compared to non-ITO coordinators) in Modern Apprenticeships in respect to likelihood of learners to complete their programmes.  Observed higher completion rates for non-ITO coordination services may be a function of differences in brokerage practices, specifically recruitment criteria, between the two.
    

There is both an observed and adjusted difference between the two funds with respect to the probability of programme completion. Learners engaged in Modern Apprenticeships are more likely to complete their programme than learners in industry training, and this is not due to demographic and provider effects controlled for in this study.

This effect does not apply equally to all industries involved in training in both funds, but due to the bulk of learners successfully completing in Modern Apprenticeships at higher rates than industry trainees, it applies in aggregate. The Modern Apprenticeships model does not provide a premium for completion wholesale, with a little under half of all matched ITOs showing a lower adjusted completion rate for Modern Apprenticeships learners than for normal industry training learners.

It is not clear what this effect represents, but it could be something to do with the differences in the way the two programmes are administered in some industries, as well as the industry specific variables, such as how participants are recruited into workplace-based training, and how workplaces manage it, that have not been quantified. There may be uneven application of the programme between industries, or it may be that the model simply does not suit in some.

The in-aggregate completion premium for Modern Apprenticeships could also be a reflection of the more rigid structure of the programme, rather than the additional supports provided by the coordinator. The greater stipulations for a training plan, the wider transparency required with the additional (sometimes non-ITO) third party as coordinator acting as a go-between, and the higher brand awareness of Modern Apprenticeships, all may contribute to situations where it is hard for any party to not be aware of the requirements of the apprenticeship. Hence the training is applied in practice as it is intended in theory. These may be issues for learners engaged in industry training where it is not always clear that the requirements for training plans are consistently applied.

Each ethnic group seems to performs equally between both funds, despite the observations that there are differences between them and the fund (the fund variable denotes whether the training is under the industry training or Modern Apprenticeship programme). No performance advantage or disadvantage appears to be present between each ethnic group when the value of fund is changed. This finding is counterintuitive, since it is imagined that the more supportive  approach under Modern Apprenticeships might have resonated more with non-European learners, such as Māori and Pasifika, leading higher proportions of them to complete compared to other ethnic groups. This appears to not be the case, and implies that any premium towards completion appears to be equally felt between ethnic groups.

There also does not seem to be a premium on services offered by one type of coordinator (ITOs) over other types (non-ITO coordinators). Mahoney (2009b) found that that in some situations non-ITO coordination seems to result in higher completion rates than ITO coordination. However, this study suggests that these differences may be more due to the differing selection criteria adopted by non-ITO coordinators over ITO coordinators (differing brokerage practices), and a concentration of provision-related variables associated with success between the different fund categories, since any difference between them disappears when these are controlled for.

It could be that all coordinators are applying the same types of services, at roughly the same level. It is odd that no difference is ascribable to coordinator types, given that market theory states that competition in markets for provision of services is always a good thing. If competition always inspires innovation in services to occur, then these innovations have been applied evenly across all coordinator groups. This is unlikely to be the case, and it is more likely that the coordinators are all equally applying the minimum of services required under their contracts with the TEC. This implies that there is, or has been to date, little incentive for coordinators to innovate which is a situation which would be worsened if coordination were to be restricted to one type of provider only, for instance.

This report suggests that there may be a case for review of mentoring and peer/support services on offer in Modern Apprenticeships, and the operational policy settings that provide incentives for providers to innovate.