Seeking A Meeker DC Clique

Although he was one of the forerunners of modern music, Joe Meek’s profile befits his name. Born in England in 1929, Meek demonstrated a proclivity for electronics from a young age, building radios and an early working television. Meek was a radar technician in the Royal Air Force, then went to work as an audio engineer. As an engineer and producer, Meek originated recording techniques that became commonplace: close-miking, overdubbing, tape loops, and compression. Meek’s distinctive sound was distorted, swirling, and echoing, as exemplified by Telstar, one of the many #1 hits produced at his home studio and the first British single to top the U.S. charts.

Meek was more renowned for his pioneering engineering work than his judgment. He advised Brian Epstein to pass on the Beatles. He told the Moontrekkers he’d record them only if they got rid of their lead singer, Rod Stewart. And one time he tried to coax a better performance from drumming legend Mitch Mitchell by holding a gun to his head.

Meek was even more unorthodox outside the studio. To say he broke the mold of the white-coat-wearing audio engineer would be an understatement. He was paranoid, thinking competitors were hiding microphones in his walls. He wore sunglasses everywhere, fearful of being recognized. And he became convinced he could communicate with the dead, setting up tape recorders in cemeteries to hear what they were saying.

During a séance in January 1958, Meek received the following message: “February 3, Buddy Holly dies.” Certain he had received a message from beyond, Meek went to great lengths to attend a Buddy Holly show and pass a note of warning backstage; Holly mentioned the encounter in an interview after February 3, 1958 had come and gone. Of course, tragically, on February 3, 1959, Buddy Holly died in a fiery plane crash near Clear Lake Iowa, along with Ritchie Valens and The Big Bopper: The Day the Music Died.

Meek’s remarkable prediction of Holly’s death on February 3 may be the ultimate example of a broken clock being right on occasion. But it shouldn’t distract from the fact that the clock was, in fact, broken.

66 years later, when socioeconomic mobility is more likely to have been achieved by the dead than the living – what with economic opportunity reduced to a coin flip – it’s never been more important for the guardians of America’s education and workforce systems to be right. It’s also increasingly the case that when they’re right, it’s a coincidence. Because, like Joe Meek, they are broken clocks.

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When it comes to socioeconomic mobility, apprenticeships stand apart. In stark contrast to the raucous debate over the short- and long-term return-on-investment (ROI) from enrollment in college, there’s no question about apprenticeship; because there’s no tuition, ROI is theoretically infinite. What we know is that apprentices typically end up with a $30K pay bump and that two-and-a-half years after starting an apprenticeship, income rises 43%. Moreover, because an apprenticeship is a job, it’s the only mode of postsecondary education where opportunity is completely independent of background or resources – the only one where underprivileged and underrepresented students aren’t at a material disadvantage.

This explains why a major political party in India is considering proposing a right to apprenticeship. And why on March 6, a day ahead of the State of the Union, the Biden Administration issued an executive order calling on Federal agencies like Defense, Homeland Security, and Health and Human Services to not only prioritize apprenticeships by adding incentives for contractors and grantees to hire apprentices, but to establish apprenticeship programs and hire apprentices themselves. Per the executive order, “the Federal Government can scale and expand Registered Apprenticeship programs to modernize and broaden avenues to Federal jobs, thereby improving access to opportunities for underserved workers… It is the policy of my Administration to promote Registered Apprenticeships.”

Unfortunately, as the world zigs, the U.S. Department of Labor (DOL) zags. While the U.S. Department of Education has been taking heat for its failure to launch the simplified FAFSA – never have the words “financial aid” and “glitch” appeared so frequently in close proximity – ED might be a broken clock technically, but in terms of decision making, DOL makes ED look like Brian Epstein.

When it comes to executing President Biden’s policy to promote apprenticeships, DOL should have two overarching objectives: (1) reduce barriers to establishing apprenticeship programs; and (2) increase financial incentives for employers to hire apprentices. But results since publication of my recent book are not promising.

In December, DOL released 779 pages of proposed new rules that would burst the first goal. These “system enhancements” that the regulator touts as “modernizing” apprenticeships, would add – by my count – at least 10 big new hurdles for employers and intermediaries considering hiring apprentices. They are:

• Elaborate new rules for written employment agreements with apprentices (which must be transmitted to government within 30 days).
• Individualized training to account for prior learning, training, experience, or accelerated progress (something no college or university has ever been required to do).
• New end-point assessments that certify the apprentice’s successful attainment of all the knowledge, skills, and competencies necessary for proficiency in the occupation (also not anything asked of higher education).
• Document and disclose all violations of occupational safety, health, and labor standards, equal opportunity rules, employee harassment or assault, any other applicable laws governing workplace practices or conduct, and financial mismanagement. “Such disclosure must include a description of the violation, as well as the actions taken by the employer to remedy the violation.” As there’s no date in the proposed rule, DOL presumably wants this information from inception. (Pretty sure General Motors won’t be keen on gathering 116 years of data.)
• A written plan for the equitable recruitment and retention of apprentices from underserved communities including a list of recruitment sources with contacts at each.
• An anti-harassment training plan for all employees involved with the apprenticeship program.
• A raft of new recordkeeping requirements: maintaining employment, apprentice performance, training hours, and safety and health records for at least five years.
• Seven independent written attestations: (i) intent to comply with all federal, state, and local laws; (ii) with disability, occupational safety, and health laws and regulations; (iii) with federal and state equal opportunity laws and regulations; (iv) with the Support for Veterans in Effective Apprenticeships Act of 2019; and that (v) apprentices will be afforded same worker protections and benefits as regular employees; and employer will (vi) provide safety training; and (vii) implement measures to promote and maintain a safe and inclusive workplace environment.
• Information showing that the employer has the financial capacity to operate the proposed program. (But as Bob Lerman noted in a recent op-ed, “what businesses will be eager to show their accounts to the Labor Department for the uncertain benefit of registering a program?”)

This regulatory wish list might be fine – adding protections for apprentices is theoretically positive – except for its impact on employers and their willingness to hire apprentices in the first place. After all, last I checked, hiring apprentices – by definition, paid workers initially less productive than typical entry-level workers – is completely voluntary. Apprenticeships for America (AFA) conducted a burden analysis with over 300 employers, sponsors, and intermediaries and found that “the proposed rules do not eliminate a single employer or sponsor requirement. Instead, the rules bring new requirements in related instruction, recordkeeping, complaints processes, equal employment opportunity processes, and more. The Department’s failure to offset new requirements with reductions in employer costs in other areas suggests a problem in priority setting.” DOL, AFA concludes, “has failed to set priorities in ways that… threaten to collapse the system under the weight of new requirements.”

Just as a broken clock is right twice a day, there are certainly circumstances in which each of these proposed new rules could produce positive outcomes. But per AFA, the overall impact would be crushing: “the expanded obligations for employers will throttle the growth and the promise of apprenticeship in the United States.” If the proposed rules are implemented, DOL’s sister agencies following the executive order to launch apprenticeship programs and hire apprentices will learn this the hard way.

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There would appear to be better news on the second prong: increasing financial incentives for employers to hire apprentices. Last month, DOL announced $200M in new funding. But will it go to employers hiring the most apprentices? No. Half will go to organizations good at navigating 85 pages of instructions for applying for DOL grants of up to $8M, likely workforce boards and community colleges. And the other half won’t go to employers at all, but rather to states seeking to beef up apprenticeship infrastructure.

Governments generally don’t do a great job of picking winners. In Apprentice Nation, I document how we’ve frittered away hundreds of millions of dollars on grants to organizations that don’t run apprenticeship programs or hire apprentices. Grants may be necessary where there are massive fixed costs e.g., chip fabrication. But apprenticeship is not that. It’s entirely feasible to stop trying to pick winners and move to formula funding so employers and intermediaries receive an incentive for every apprentice hired – rewarding efficient operators and sidelining slouches. Formula funding or pay-per-apprentice is not only possible, it’s how every other country ahead of us in the apprenticeship game does it. And as AFA points out, formula funding’s success in building earn-and-learn infrastructure has encouraged America’s competitors to invest much more in apprenticeships: on a per capita basis, between 15 and 250 times more.

In terms of both regulation and picking winners, America would benefit from a meeker DOL; the DC clique doesn’t always know best. My working theory is that DOL’s overconfidence stems from an underlying insecurity about the inherent value of apprenticeships. While the White House’s executive order demonstrates an understanding that apprenticeships are good in and of themselves, DOL seems to see itself more like a neutral arbiter focused on “quality” apprenticeships with sufficient worker protection and equal opportunity.

What DOL appears to be missing is that apprenticeships shouldn’t be regulated in the same way as tuition-based postsecondary education, where students take significant financial and employment risk. Because apprenticeships are jobs that pay a living wage with built-in training and clear career paths, apprenticeships provide greater safety and equal opportunity than any other postsecondary pathway. And that’s before any new rules. Today’s registered apprenticeship is a quality apprenticeship. So the consumer protection zeal that has characterized the activities of CFPB, FTC, and ED is misplaced in the apprenticeship context. Given the increasing identification of the Democratic Party with college-educated we-know-better elites, this DOL-sized hole in the Biden Administration’s nascent apprenticeship agenda could contribute to a November election result that will sink the entire consumer protection enterprise.

In other sectors subject to intense scrutiny, Congress requires regulators to consider not only risks, but also the benefits to general welfare e.g., FDA. Given the exigencies of climate change, a new House bill would require the Nuclear Regulatory Commission to do the same for approving new nuclear power plants. Perhaps a similar bill will be necessary for apprenticeships. But a much better and quicker option would be for DOL to self-correct: be meeker and less like Joe Meek.