Apprenticeships Are Making a Comeback

What do Leonardo da Vinci, Benjamin Franklin, Elvis Presley, and Mickey Mouse have in common? OK, yes, they are all famous.

But they were all also apprentices. (Though maybe it’s best if Mickey doesn’t highlight his time as the sorcerer’s apprentice in Fantasia on LinkedIn.)

Apprenticeships, in practice for thousands of years, are having a moment this century in the insurance industry and beyond. Why? Employers need skilled workers and young people want a path to a good job without accruing lots of debt. Voilà, an old idea is reborn.

Since The Council Foundation’s core mission includes bridging the talent gap facing the insurance industry, it makes sense to look at how apprenticeships can help attract and build skilled workers here.

The practice of apprenticeships dates back to ancient Mesopotamia. About 4,000 years ago, in Babylon, artisans would often adopt children to teach them their craft, as they would later profit from their children’s skilled labor. The importance of knowledge transfer remained known for millennia. During the 12th century, European merchant and stone mason guilds, among others, established apprenticeships to ensure quality craftsmanship. The system continued through the Industrial Revolution but was in decline by the 20th century, though apprenticeships remained strong in construction and manufacturing.

In the early 21st century, apprenticeships began to evolve beyond the manual trades into fields such as healthcare, IT, and finance. And they are making their way into our industry as well.

Modern apprenticeships typically last one to four years, with participants splitting their time between on-the-job training and classroom instruction and the formalized training following a structured curriculum. Employers invest heavily in apprentices with the expectation of retaining them afterward. They are distinct from internships, which generally last weeks to months, may be paid or unpaid, and are often informal and more observational in nature.

This approach makes sense. Many companies are rethinking white collar jobs that traditionally require a four-year college degree. Fields like tech, finance, and business analytics are evolving faster than traditional education can keep up, highlighting the value of combining academia with hands-on training via apprenticeships. A two-year degree with an apprenticeship may be all that is now needed.

Apprenticeship programs provide numerous benefits to firms, helping them build a skilled workforce, improve retention, and enhance their reputation. They can train employees from the ground up, ensuring each develops the job-specific skills tailored to the company’s needs. Many companies report that apprentices are more engaged, reducing turnover costs. They can be a cheaper alternative to hiring fully trained employees.

Studies show that apprentices become more productive quickly, often contributing to business operations within months. A study by the North Carolina Department of Commerce’s Labor and Economic Analysis Division revealed that registered apprenticeship programs in the state yielded a 170% ROI for employers.

Offering apprenticeships also demonstrates a firm’s commitment to workforce development, enhancing its employer brand.

Data on how widespread apprenticeships have become in the U.S. insurance industry was not immediately available, but anecdotally they have proven their value in recent years. Zurich Insurance and Aon, for example, both have highly successful programs.

Zurich’s Apprenticeship

Zurich began an apprenticeship program in North America in 2016. Driven by the need to attract qualified employees and inspired by Switzerland’s esteemed vocational training system, the global insurance company began offering registered apprenticeships in partnership with Harper College, a community college in Palatine, Illinois.

The two-year earn-while-you-learn initiative combines three days of on-the-job training with two days of college coursework each week, leading to an associate degree or a bachelor’s degree for participants who have two years of college credits—all funded by Zurich. Coursework focuses on business management with a concentration in risk management and insurance.

Apprentices receive a full-time salary, comprehensive benefits, and a guaranteed position upon successfully completing the program. Initially focused in Schaumburg, Illinois (home of Zurich North America), the program expanded in 2022 to approximately 70 apprenticeship programs in Atlanta, Chicago, Houston, Los Angeles, New York, Overland Park (Kansas), Philadelphia, San Francisco, and other cities.

Zurich’s program has been instrumental in attracting individuals from varied backgrounds, such as high school graduates, military veterans, and those transitioning careers. This approach has enhanced workforce diversity and inclusion by removing barriers to entry and actively recruiting from diverse communities. Notably, the program boasts a 100% placement rate for graduates and an impressive cumulative retention rate of approximately 85%.

Aon’s Apprenticeship

The global professional services firm launched its U.S. apprenticeship program in 2017 in Chicago, collaborating with the City Colleges of Chicago. The inaugural cohort consisted of 25 apprentices.

The two-year, full-time program integrates on-the-job training with academic coursework, allowing apprentices to work at Aon while pursuing an associate degree at a partner community college. The program emphasizes industry fundamentals, including business and financial skills, alongside soft skills such as communication, teamwork, and customer service. Training may include assisting with client accounts, analyzing data, supporting the underwriting process, and helping with risk management.

Aon covers tuition, books, and fees, and apprentices receive a salary with full employee benefits. The typical weekly schedule includes approximately three days of work and two days of classes. Building on the initial success, Aon expanded the program to cities including Houston, Minneapolis, New York, Philadelphia, San Francisco, and Washington, D.C., with the goal of creating 10,000 apprenticeships nationwide by 2030.

Chicago Apprentice Network

In 2017 Zurich, Aon, and Accenture co-founded The Chicago Apprentice Network to promote apprenticeship opportunities across industries. As of July 2024, the Network had facilitated over 2,000 apprenticeships in the Chicagoland region. The program’s excellence has been acknowledged with accolades such as the Pledge to America’s Workers Presidential Award in 2020 and the designation as an Apprenticeship Ambassador company by the U.S. Department of Labor in 2022.

If your firm has a successful apprenticeship program, I would love to hear about the great things you are doing. The Foundation will be looking for ways to incorporate an apprenticeship program into our five-year plan. If you don’t already have one, perhaps an apprenticeship program could be the answer to your company’s talent gap.