How to strenghten partnerships with the productive sector? The case of the dual system in Germany Anke Bahl Federal Institute for Vocational Education and Training (BIBB), Germany Mexiko City, April 28th 2014

The case of the dual system in Germany Agenda The German dual vocational education and training system and its origin in the productive sector The qualification structure in Germany – The innovative potential of VET Institutional framework of the dual system – The important role of the social partners The costs and benefits for training companies Summary

German dual system of vocational education and training Vocational school and the company providing training fulfill a joint educational remit 1-2 days/ week 4 days/ week Vocational School Training Company Teaches vocational and general educational content Trains specialist competence and general skills Enables pupils/students to understand and reflect the theoretical fundament of their vocation Provides opportunities for learning by integrating the apprentices in real work processes applying the domain specific contents learned at school in practice Enables apprentices to acquire the ability to perform professionally on their own INAP Conference, Annalisa Schnitzler

The productive sector: origin and driver of the German VET system

Participation in apprentice training by size of enterprise in 2011 in total thereunder 2 Mio. 1-9 employees 10-49 employees 50-499 employees 500 and more employees 2.1 million enterprises 1 Mio. 1.67 million enterprises 500.000 335.000 enterprises 100.000 80.000 enterprises 50.000 45.7 % provide training All in all, only one quarter of all enterprises provide training. The participation of the enterprises in training is closely linked with their size. The larger the enterprise, the more likely is it to provide training. Glossary Vocational education and training Enterprise Statistics 21.7 % of all enterprises provide training 67.6 % provide training 14.000 enterprises 5.000 14.2 % provide training 84.8 % provide training enterprises Quelle: Beschäftigtenstatistik der Bundesagentur für Arbeit; Stichtag 21.12.2011

The case of the dual system in Germany Agenda The German dual vocational education and training system and its origin in the productive sector The qualification structure in Germany – The innovative potential of VET Institutional framework of the dual system – The important role of the social partners The costs and benefits for training companies Summary

Forecast: Development of qualification requirements in Germany Levels of qualifications (in percent) reference: Institute for future of work (IZA), 2007

The case of the dual system in Germany Agenda The German dual vocational education and training system and its origin in the productive sector The qualification structure in Germany – The innovative potential of VET Institutional framework of the dual system – The important role of the social partners The costs and benefits for training companies Summary

Public-Private-Partnership: Shared responsibility in VET Vocational training act Federal Government Federal states (Länder) Unions Employers governed by a statutory legislative framework cooperation between the public and private sector common steering, regulation and financing arrangements The Vocational Education and Training Act Private-public partnership: determines the role of the stakeholders, their rights and duties Clear financing rules: enterprises cover their own training costs (e.g. apprenticeship pay, cost of trainers, material). The government is funding vocational schools, research in the field of vocational education and training and training promotion programmes. Organisational infrastructure through the chambers: accreditation of training companies, registration of training and work experience agreements, examinations and certification Core elements of vocational education and training: determination of the learning venues, provision of the training duration and the examination requirements; provisions regarding the training agreement and the recognition of previous learning; apprenticeship pay etc. Federal Institute for Vocational Education and Training (BIBB): platform for dialogue by decision-makers, development and research institute. Carries out research, development and advisory services for politics and practice.

National standard: Basic elements of vocational training regulations Designation of the training occupation „Car Mechatronic“ Duration of the training „2 - 3,5 Years“ Occupational profile „Occupational Standard“ Training programme „Training Standard“ (2) Vocational education and training in the dual system means that the enterprises are responsible for providing and funding training. However, enterprises are allowed to train young people only in the government-approved training occupations. The specification of binding training regulations ensures uniform national standards that do not depend on the requirements of the enterprise at any given time. Quality control over in-company training, that is, over the aptitude of the companies providing the training and of the company training personnel, is assumed by the competent bodies, the chambers. The enterprises assume the costs of in-company training and provide the trainees with training allowance, the amount of which is determined in negotiations between unions and management. Examination requirements „Assessment Standard“

Continuous reforms: Training regulations as a means of innovation

Participants in the process of developing training regulations Coordinator employers Coordinator unions Employers Trade Unions Experts employers Experts unions State BMWi/KMK BMBF Ministry of Economics Ministry of Education Education Ministers‘ Conference 12

Training regulations: Aims of the employer associations Coordinator employers Job-specific qualification High specificity of training for the firm / sector Securing the skilled labor needed for regional / national and global competitiveness Employers Experts employers 13

Training regulations: Aims of the trade unions / employees Definition of skills that are polyvalent and transferable to other contexts Preservation of labor mobility and mobility of apprenticeship graduates across educational sectors Coordinator unions Trade Unions Experts unions 14

Training regulations: Aims of the state Personality development / citizenship Transition of youth into world of work Uniform qualification standards Occupational flexibility and broad educational pathways State BMWi/KMK BMBF Ministry of Economics Ministry of Education Education Ministers‘ Conference 15

Role of the social partners as central stakeholders of the dual system National level Participation in the development of training regulations/standards; expert recommendations in all fields and aspects of vocational education and training Regional level State (Länder) level expert recommendations in all fields of vocational education and training with regard to the coordination between school and enterprise Level of competent bodies Counselling; monitoring of the implementation of training in the enterprises; holding of examinations; granting of certificates/qualifications Sectoral level Negotiations about the supply of apprenticeships; wage agreements covering apprenticeship pay Company level Planning and carrying out training in the enterprises The main feature of the German VET system is the close partnership between employers, trade unions and the government. This partnership is expressed through the involvement of management and labour in the formulation of the goals and content of vocational education and training. "Social dialogue" and codetermination are of crucial importance for the acceptance of reforms. Of particular importance is the institutionalised form of a close involvement of management and labour in the planning and implementation of in-company vocational education and training. Committees at all levels have been established for this involvement. These bodies deal with basic principles and individual details of implementation and development of vocational education and training. On national level social partner involvement is established with the Hauptausschuss (Main Board) of the Bundesinstitut für Berufbildung (Federal Institute of Vocational Education and Training) on a four-partite basis (Federal Government, States, Employers, Employees). One outstanding task is the involvement in the setting of standards and designing of training regulations. On Länder level there are committees for vocational training, with equal representation of employers, employees and the Länder authorities. They advise the Länder governments on vocational training issues. This does not give management and labour any co-determination in vocational school matters. However, they can advise the state government in this way and also to a certain degree influence concepts and schemes, for example those for providing support for disadvantaged youths, and opportunities for additional qualifications requiring school training. On regional level, the Zuständige Stellen (competent bodies) play an outstanding role. Competent bodies, in the sense of the Berufsbildungsgesetz (BBiG; Vocational Training Act), are above all the chambers of industry and commerce, the chambers of handicrafts, etc. but also various federal and Land authorities. In every competent body there is a vocational training committee which is made up of tripartite representation of employers, trade unions, teachers. It has to be informed and consulted on all important issues of vocational training. Moreover, the committee has to decide which legal regulations are to be passed by for the implementation of vocational training. The most important duties of the competent bodies in vocational training are: ·setting up and keeping the directory of apprenticeships; ·promoting vocational training by providing counselling to enterprises and trainees; ·supervising the implementation of vocational training; ·conducting intermediate, final and further training examinations. The Betriebsverfassungsgesetz (BetrVG; Works Constitution Act) (private sector) and the Personalvertretungsgesetz (PVertrG; Staff Representation Act) (public service) grant works councils or staff councils numerous co-determination and involvement rights at the company level both in the field of initial and continuing training. The fields in which these rights are exerted include collective bargaining on the remuneration of trainees, planning and implementing in-company training, appointing the instructors, realising special in-company education and training measures, concluding employment contracts upon completion of training, continuing training leave. Glossary: Social partners, Vocational training system.

The case of the dual system in Germany Agenda The German dual vocational education and training system and its origin in the productive sector The qualification structure in Germany – The innovative potential of VET Institutional framework of the dual system – The important role of the social partners The costs and benefits for training companies Summary

Why do firms train apprentices? - Research on motives Production motive: firms train mainly because they want to benefit from the apprentices’ productive contribution (Lindley 1975) Investment motive: firms train because they want to retain the apprentices after training and ensure the skills of their future employees (Merrilees 1983) Screening motive: firms use the training period to observe the apprentices and choose the best for retention (Stevens 1994) Social responsibility: firms train because they want to give young people the possibility to integrate in the labor market (e.g. Beicht et al. 2004) Reputation motive: firms expect that clients, potential employees, and suppliers have a better image of the firm when they train (e.g. Niederalt 2004) Because training is a part of company tradition To be able to use trainees during the training period To secure the next generation of workers for the region To avoid high employee fluctuation Because training is the duty of society as a community To prevent the risk of hiring the wrong employees To be able to hire the 'best’ workers To train future employees according to company requirements

Net costs of apprenticeship training in 2007 for the firm Average Gross costs, Benefits and Net costs of apprenticeship training in 2007 (per apprentice and year of training) Gross Costs: Apprentices wages Costs for trainers Infrastructure/facilities Benefits during training: Productive contribution of apprentices Benefits through retention: Recruitment costs Productivity differences Costs of misappointment Institutionalised regeneration of staff Gross cost: 62% costs for apprentices 22 % costs for trainers 4 % “physical” costs 12 Other Costs

Average results for 51 training occupations – Net costs 2007

Comparison of two occupations (crafts vs. industry) 22114 15528 12493 10503 6586 1990

SME crafts sector Electrician and sanitary trade (25 empl.) Inter-company training centre        Customer Service Projects Construction site        = part-time trainer / owner  = fulll-time trainer   = part-time trainer / journeyman

The case of the dual system in Germany Agenda The German dual vocational education and training system and its origin in the productive sector The qualification structure in Germany – The innovative potential of VET Institutional framework of the dual system – The important role of the social partners The costs and benefits for training companies Summary

Benefits of cooperatively structured VET For enterprises next generation of skilled workers assured low recruitment costs influence on content and organisation of vocational training For apprentices labor market relevant training, i.e. improved chances on the labor market after completion of training; uniform qualification standards motivating situation (earning & learning) acquisition of social skills, personality development For the state possibility to offer all school leavers vocational training private sector contribution eases the burden on public budgets finding partners for developing international competitive standards

Many Thanks for your attention! Anke Bahl ++49 (0) 228 107- 1407 bahl@bibb.de www.bibb.de

Education and training system in Germany Continuing education Weiterbildung Tertiary level over 19 years Continuing vocational training Universities Dual System Company / part-time vocational school Full-time vocational school Senior level at compr. secondary school Secondary level II 16 to 20 years Lower secondary school Intermediate school Comprehensive secondary school Secondary level I 10 to 15/16 years Primary school Primary level 6 to 10 years Source: OECD

Structure of the dual dystem in Germany Cooperation, Coordination Vocational School (public) Companies (private) Learning Venues are: Didactic Foundation Didactic Foundation Learning Venues are: Vocational Training Regulation with Syllabus Timetables Examination Requirements Occupational Profile Framework Curriculum Examination Requirements Workplace Training Workshop Classroom Training Workshop inter-company Vocational Training Establishments Harmonisation Regulated by School Acts (Länder) Regulated by Vocational Training Act (Bund) The Trainees are: Designation of Learners: Youths / Adults Designation of Learners: Vocational School Students Legal Basis: Compulsory Schooling (School Act) Apprentices / Trainees The training is completed by the final examination Legal Basis: Craft / Journeyman‘s certificate Apprenticeship Contract ®

Quality assuring of in-company VET within the dual system according to the German Vocational Training Act (BBIG) 3 Player in dem Dreieck State (Federal Government) Instruments: laws (e.g. BBIG) and statutory orders (e.g. training regulations) In-company initial vocational training Training companies (companies providing training) Instruments: training contracts and training programmes Competent bodies (chambers of trade, chambers of industry & commerce) Instruments: monitoring, consultation & regulations

Model of construction sector: sectoral training fund Sharing the training costs by all firms of the sector Special funding  incentive for offering in-company training All companies in the building trade pay for training young talents regardless of whether they offer training or not: 1,2% of „total gross salary-pay“ Companies, which offer Vocational Training, get reimbursed for: Inter-company vocation-oriented training Driving costs for the apprentices Payment for apprentices (in parts), e.g. Industrial apprentices: 1st year: 10 months 2nd year: 6 months 3rd year: 1 month … according to increasing productivity of the apprentices

Step by step - Becoming a skilled worker in the building industry

Vocational training regulations – The process behind them Mostly initiated by employers & employees Proposition of a new occupational profile Vorphase Application meeting at the competent ministry Designation Lenght of Training Occupational Field Type & Structure of the training Timetable List of skills and knowledge Definition of the Benchmarks of the vocational training regulation Draft of training regulation (firm) Draft of framework curriculum (school) Coordination Consultations in Boards Erarbeitungs- und Abstimmungsphase Experts of Federal government Employers Employees Managed by BIBB Permanent Subboard Main Board Consensus principle Examination of compliance with legal formalities Adoption by Länder committee Promulgation in the Federal Gazette Erlass- phase

Distribution of trainees among enterprise size classes in 2011 14.2 % provide training 45.7 % provide training 67.6 % provide training 84.4 % provide training Quelle: Beschäftigtenstatistik der Bundesagentur für Arbeit; Stichtag 21.12.2011

Variety of skill formation systems in advanced industrial democracies Public commitment to vocational training High Statist Sweden France Collective Germany Austria Switzerland The Netherlands Denmark Low USA Ireland Liberal Japan Segmentalist Involvement of firms in initial vocational training Source: Busemeyer, M.R.; Trampusch, C: Introduction: The Comparative Political Economy of Collective Skill Formation. In: Busemeyer/Trampusch (Eds.): The Political Economy of Collective Skill Formation. Oxford/ New York 2012, p. 12

Head office / Main location Technical Training; Workshop Large Company of the Manufacturing Industry Power and Electrical Engineering (8600 Empl.) Head office / Main location Location B Location C Commercial Training, dual study courses  Technical Training; Workshop   = training manager  LocationA = full-time trainer  = part-time trainer

Head of initial and continuous training Industrial Training in the Production Sector Vehicle and Engine Construction, appr. 1500 Employees Head of initial and continuous training Trainer / Meister (rotating workforce) Production lab Full-time trainers (with Meister qualification) in training workshop (permanent)   = training manager CVET  = full-time trainer Coordinator Weiterbildung   = part-time trainer/ informal workplace trainer    Vehicle Assembly Engineering Mechanics Logistics IVET training coordinator    IVET training coordinator IVET training coordinator IVET training appointee (=Meister) IVET training appointee (=Meister) IVET training appointee (=Meister)    Informal workplace trainers Informal workplace trainers Informal workplace trainers            … …

Large Company of the Services Sector with Branches Insurance Group (5500 Empl.)  VD  Vertriebsdirektion (VD) Agentur      Head Office IVET management   Agentur   VD  Vertriebsdirektion (VD)     Agentur   VD  VD       = training manager = part-time trainer