Apprenticeship: Why Companies Should Look At It Seriously?

Apprenticeship is one such adaptable way that should be manifested both by the Government and Industry to prepare aspirants for a distinct job while fulfilling a company’s demand for employees.

The economic slowdown due to the COVID-19 pandemic has impacted several industries, making a lot of them battle to survive. In this situation, salary cuts and layoffs are being touted as the best options for businesses to remain afloat. The fact that the pandemic has changed the rising demand of certain industries for unskilled and low-skilled workforce can’t be changed. Hence, in the post-COVID era, remunerative chance to earn as well as gain the necessary skills will act as a pathway for industry-relevant specialists. Apprenticeship is one such adaptable way that should be manifested both by the Government and Industry to prepare aspirants for a distinct job while fulfilling a company’s demand for employees. Presently, the focus of the Government lies in skilling because of its considerable national priority. According to NAPS (a scheme for apprenticeship) Guidelines, the aim involves engaging 50 Lakh apprentices. 

Over the past few years, the Government amalgamated multiple changes in the Apprenticeship Rules (1992) with the target to expand skilled workforce and financial raise for apprentices and also ensuring that the rules are Industry friendly. Apprenticeship programmes offer on-the-job (OTJ) training and basic training to freshers through various placement opportunities. In addition, these programmes address the skills gap of industries by tailor-made-training that enables business owners to instruct their prospective employees in the relevant skills.   

Companies benefitting from Apprenticeship 

The registered employers under the Apprentices Act, 1961 are let off from contributing to Employees State Insurance (ESI) and Employees Provident Fund (EPF) for the apprentices engaged by them. Other than that, financial support is provided for employers under the National Apprenticeship Promotion Scheme (NAPS) launched in August 2016. NAPS was introduced to upgrade apprenticeship and elevate the number of apprentices in the ecosystem. One big advantage of NAPS is its end-to-end service for employers via third-party administrators (TPA) as the loyalty element in apprentices is greater with a reduction in attrition. 

The Apprentices Act also backs establishments, particularly MSMEs, to engage apprentices with a prescribed rate of stipend to them and is delinked to the state wage act. 25% of the stipend (under NAPS), subject to a maximum of Rs 1500 per month per apprentice, is reimbursed by the Government later.  

It has been noticed that organization hiring apprentices have a greater retention rate than hiring fresh candidates under contract. The candidates look forward to the certification that they obtain from the government at the end of the training program. The candidate can be an apprentice for a period of 6 months to 3 years depending on the program that he/she is registered under.   

Additionally, assistance is provided to the establishments that don’t have in-house training facilities or an outdoor centre for training fresher apprentices with a basic training amount of up to Rs 7500 per apprentice for maximum 500 hours. Companies engaged with apprentices can also opt for ‘skill training’ from their CSR funds to the demand under the Apprentices Act and the expenses incurred in the training can be claimed as CSR expenses. It is also mandatory for any organization having more than 30 employees to have at least 2.5% of the employees as apprentices as per the apprenticeship act.   

Benefitting of Students and Workforce from Apprenticeship  

The working-age population of India will continue to grow over the next few years. For an uninterrupted transition from school to work, apprenticeship should be considered as the chief mechanism. Apprenticeship supports dropouts and new entrants in the workplace receive the required skills and knowledge to succeed in their chosen industry, therefore bridging the existing skills gap. Any industry in any sector can work under the apprenticeship act. The hands-on training offers these apprentices a chance to put their skills into practice, helping them gain further confidence in a working space. They also get an opportunity to learn as well as work while obtaining credentials within the company reinforcing their employability. 

Apprenticeship benefitting from skill development 

Apprenticeship programmes encourage and promise skills delivery mediums in the industrial and training environment of India. They present a rigorous and structured training that aids apprentices upgrade their skills. In addition, these programmes provide apprentices a chance to set forth their skills into practice. Some of the most prosperous economies in the world have also been promoting the apprenticeship system.   

In the midst of the COVID-19 pandemic, jobs which don't add value to businesses will cease to exist. Therefore, to bridge the gap between the skills in demand and skills produced need extensive apprenticeship programme as well as participation. The current responsibility lies with the public and private sectors to reform to enable speedy employment opportunities for the apprentices.  

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house

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