Note: The author is a British bilingual entrepreneur who has lived and studied in Germany, and draws on insights from native German connections.
Due Praise For A Dual Approach
In his announcement speech towards the end of 2020, Gavin Williamson said of Further Education:
“Its ability to offer flexible, practical training that leads directly to jobs is exactly what this country needs.” and “…the development of technical and vocational skills, the greater embedding of digital skills – will be vital to charting our course to recovery.”
He also promised to reveal plans for a world class, “German style” apprenticeship system in the UK. While it is clear that certain elements of Germany’s system could be adopted for the better, such as building a more unified approach, and encouraging British parents to appreciate the benefits of apprenticeships over traditional higher education, simply copying and pasting the German model may not be the most effective strategy for the UK.
It is rather interesting how much the British seem to ‘admire’ Germany while understanding very little about its culture, people or language beyond the stereotypes. In fact, in the UK, only around 8,000 students (1 in 65) pursue a modern language degree each year. Even fewer Brits choose to study German, despite it being one of the top 10 most important business languages!
That said, the German apprenticeship model is admired by other countries too, such as the USA. For the most part, this praise is well earned. The percentage of young Germans not in employment, education or training (NEETs) is far below that of other Eurozone countries.
According to a paper published by the WZB Berlin Social Science Centre, the German dual system allows young people to ‘move smoothly into skilled jobs’ and avoids the ‘polarised qualification structure’, such as in the UK where until recently there were fewer qualifications to straddle the gulf between those with and without a university degree.
Indeed, a plentiful supply of skilled workers serves Germany well, a country whose economy is projected to recover faster than the UK or USA from any pandemic recession, according to the latest Bundesbank projections.
By contrast, fueling the growth of UK entrepreneurship and innovation will be key moving into a post-EU economic landscape that will rely even more heavily on domestic business and job creation.
Let’s consider some of the reasons why the German apprenticeship model works so well in Germany…
If you’ve never studied or experienced German culture and every day life, you may not understand the extent to which the education system is designed to produce process-driven “worker bees” to power its famously efficient skills-based economy.
Roughly 40% of apprentices in Germany get offered jobs with the same employer before the end of their apprenticeship programme; Of those having already received a job offer from their employer, over 60% are offered an open-ended contract. Bravo, Germany.
On the face of it, German apprenticeships appear to be a more reliable route into long-term stable employment than UK apprenticeships. But, government research in 2018 also revealed a very encouraging statistic for UK apprenticeships – that 65% of apprentices (of a total of 844) in the study remained in full-time employment after finishing their apprenticeship.
Of course, the job losses and skills shortages highlighted by the coronavirus pandemic have created an even greater sense of urgency around the need to embrace apprenticeships.
Wealth, lifestyle and career aspirations may appear similar to outsiders but are really quite different to those of Brits (and Americans) who, on the whole, place higher value on freedom and flexibility in most areas of life. For instance, consider the difference in attitude towards home ownership where most Germans are happier to rent a home for life – compared with over 70% of Brits, who view renting as a waste of money and home ownership a life goal!
Despite the success of Germany’s apprenticeships, could it be that the stable jobs and lifestyles it creates effectively keep Germany’s would-be entrepreneurs from breaking free of the corporate grind to start their own ventures? Certainly, entrepreneurial thinking (or knowledge, skills and behaviours) is not embedded in the German apprenticeship curriculum.
However, a system which encourages long-term skilled specialisation may not resonate as well with attitudes towards work in the UK, particularly with younger apprentices; Data from the Office of National Statistics (ONS) suggests that the number of young people choosing self-employment is slowly increasing, with 22% (in 2020) of 16- to 21-year-olds stating that they wish to become self-employed in the future.
The United Kingdom (4th) also ranks well above Germany (15th) on the Global Entrepreneurship Index.
In a 2018 German economics publication called Wirtschaft’s Woche (wiwo.de), Rolf Sternberg, professor of economic geography at the University of Hannover, said;
“There has been no [nationwide] breakthrough in Germany’s startup climate. It has slightly improved in recent years, but at a very slow pace.”Rolf Sternberg
Here’s why skill specialisation and long-term employment is more appealing to Germans;
1. Opportunity Cost
There is no doubt that better pay and working conditions give anyone, not only Germans, little incentive to become their own bosses. The sense of security afforded by a stable income and robust public pension system meets one of our basic human needs, and is surely another key reason why Germany’s entrepreneurial climate is just so-so.
Compare this with British and American employers, who have ‘championed’ the insecure zero hours contract that has fueled the gig economy since the last recession, and it’s easy to see that in economic terms, the opportunity costs of leaving a stable job in Germany appear to be too high.
2. Risk Tolerance
In Germany, students are inundated with the message that being hired at the biggest employer possible is the ultimate achievement. The result? Latent despondency towards self-employment.
It makes sense then that a survey of nearly 5,000 German citizens found that only 37% of respondents between the ages of 18 and 67 believe they have the skills and experience to follow through and launch a start-up.
To draw an even starker contrast in attitudes towards self-employment, another study found that more than 54% of Americans think they have sufficient business acumen, whereas a whopping 64% of Brits believe they have what it takes to succeed with their own business. Indeed, the small business arena makes a hugely significant contribution to the UK economy, forming 98% of private sector businesses. (That’s not to say the same degree of ambition is to be found across all generations but it is a topic for another post.)
“Entrepreneurs and business owners are no longer seen as peripheral to the way the economy functions. They are now part of the mainstream”– Mark Hart, professor of small business and entrepreneurship, Aston Business School, UK
3. Red Tape & Support Networks for Start-Ups
While Germany’s political and institutional frameworks are quite good at providing subsidies for young entrepreneurs, and were also quick to provide support small to medium sized businesses at the onset of the corona crisis, they still fall short in simplifying tax law and streamlining bureaucracy for start-up founders.
Germany would need to remove many structural and cultural hurdles to really unleash the country’s entrepreneurial potential, according to another GEM report.
“We should be conveying to adolescents that entrepreneurial self-employment is a natural alternative to full employment.”Prof. Dr. Rolf Sternberg from the University of Hannover, Global Entrepreneurship Monitor (GEM) 2017
Though the new “Mini-GmbH”, which seeks to make the shift from sole trader to limited company/corporation simpler, is definitely a step in the right direction.
While uptake of entrepreneurship studies in higher education is slowly growing in popularity, there is still a lack of start-up or freelance skills training in schools or via extra-curricular activities.
4. Perceptions Of Apprenticeships
Because of the effective collaboration between employers, schools, the chamber of commerce, and the local governments in German apprenticeships, Germans do not view them as a second rate option.
Whereas, the greatest problem with UK apprenticeships arguably lies not so much in the apprenticeship model itself, as much as people’s general perceptions of apprenticeships. While plenty of apprenticeship graduates and studies have asserted that certain apprenticeships can provide more well-rounded experience and qualifications than traditional degrees, most British adults would still choose university over an apprenticeship because of the associated stigma.
The Paradox Of Efficiency
Few outsiders understand that the German system actually prevents more apprenticeships being made available by its very design.
To become an apprenticeship provider, membership of the Handelskammer is very difficult yet compulsory to obtain, such that only 56% of German firms are authorised to deliver apprenticeships. Moreover, curricula are nationally standardised, leaving no flexibility to customise the delivery according to the specific role and the future needs of a business.
New training curricula must go through the multilayered “Elaboration Process”, a highly regulated procedure involving the Federal Government, the state governments, employers and trade unions, which verifies that the in-company training and vocational school education complement one another.
For those who have never lived there or speak the language, please understand: German efficiency is a paradoxical concept! It also means that formal processes and procedures are fixed and non-negotiable in a way to which the British mindset is not too well accustomed! (Although skeptical Americans also worry that the German model requires too much tracking, and it’s true, German children must choose at age 10 among an academic high school, a vocational track, or something in between.)
Limited Career Flexibility
While Germany’s apprenticeships optimise productivity, they also lead to a large degree of career choice inflexibility beyond the option to further specialise, which means that should individuals change their mind, improve their grades over time, or even decide to become self-employed, apprentice graduates are limited as to where they can go.
Editors at FEWeek.co.uk also picked up on this point, saying:
“Such strict career paths can focus young people on a clear direction, but leaves little room for those who don’t know what they want to do or where their talents can be best applied. Although the country is getting better, and it is now possible for students with high academic achievement at the Realschule to switch to a Gymnasium on graduation. This flexibility is important when considering how a German-style model might work best in the UK.”
German apprentices can switch tracks to an extent later on by going back to school to specialise further or earn a master craftsman’s certificate. However, only 10% of Germany’s apprenticeship graduates continue onto these higher levels of education. What education reformers call “lifelong learning” does not appear to be as as lifelong in Germany as outsiders perceive.
In the same vein, it would be interesting to know how many German employees choose to study higher education, such as an executive MBA, while remaining in work – a common option in both the UK and USA.
The Age Factor
German apprenticeships are primarily aimed at school leavers. To be exact, the percentage of people pursuing an apprenticeship over the age of 23 in Germany is very low at 9.7%. For those over 40? Just 0.2%!
By contrast, there is no upper age limit for studying a UK apprenticeship, which could really help an ever-growing older population, who work for longer either by choice or necessity. (Not to mention unfavourable UK state pension reforms!)
It seems much more prudent to find ways to leverage older workers’ experience by designing and marketing apprenticeships to appeal to all age groups – not just to young school leavers – as a valuable pathway to upskilling, reskilling or changing career paths.
After all cross-generational knowledge sharing plays a key role in the success of smaller firms in particular.
On The Right Track?
The need for instilling a digital transformation mindset and attracting more entrepreneurs from other countries to the UK post-Brexit have been researched and written about extensively. An abundance of employees who are stuck, indifferent towards – or even fearful of – self-employment is, therefore, not necessarily what the British economy needs to rebound beyond 2021.
In the UK, 83% of all starts in 2020 were in four subject areas: Business, Administration and Law; Health, Public Services & Care; Engineering & Manufacturing Technologies, and Retail & Commercial Enterprise – some of Britain’s leading industries. But there are also innovative companies, such as White Hat based in London, who hunt for “start-up talent” at apprentice level – a recruitment sector that is non-existent in Germany.
A lighter touch when it comes to UK regulation clearly challenges and encourages employers to create new programmes that align with current and future market demand, providing more opportunity to nurture entrepreneurial skills and thinking while on programme. This is clearly not as easily attainable in the German model.
Defining & Developing Entrepreneurial Competencies
There is a difference between being an fully fledged entrepreneur with employees of your own and possessing entrepreneurial tendencies or competencies, which combine creativity, a sense of initiative, problem-solving, the ability to marshal resources, and financial and technological knowledge.
These competencies are essential for innovation and digital transformation within companies. They enable future entrepreneurs and intrapreneurs (employees who apply entrepreneurial skills to projects within a company) to create and adapt to change more easily and effectively.
Efforts to develop entrepreneurial thinking through apprenticeships requires embedding the foundations of an entrepreneurial mind-set into bespoke curricula and standards, and building on this progressively and more consistently with targeted and specific project-based activities the closer learners get to end-point-assessment.
Exactly how you can implement these competences effectively in a bespoke apprenticeship programme depends on the standard chosen, and the target job role. But, you should consider the important characteristics that an individual will need in order to perform entrepreneurial functions for your organisation most effectively.
Some examples of entrepreneurial competences:
|Ideas & Opportunities||Resources||Translation
|Spotting opportunities||Self-awareness & self-efficacy||Initiative taking|
|Creativity||Motivation and perseverance||Planning & management|
|Envisioning||Mobilising resources||Coping with uncertainty, ambiguity & risk|
|Valuing ideas||Financial & economic literacy||Working well with others of differing skills & abilities|
|Ethical & sustainable thinking||Mobilising others||Learning through experience|
Since British values are incorporated into apprenticeships as standard, perhaps we should even include “entrepreneurial” and “innovative” on the list, and embed these as skills, attributes, and behaviours more often in our course materials and curricula, as we do when designing bespoke programmes at FE Matters.
📚 Here’s a list of 12 useful websites on the German apprenticeship system.
Comment if you found this useful or share your experience of embedding entrepreneurial competencies.👇
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