Startup Grants: New Jersey’s PACE and GAINS initiatives

To judge by the few studies available, the social and economic benefits of investing in apprenticeship can be enormous. Especially in the case of nontraditional programs, however, the costs of starting an apprenticeship can be very large as well.¹

Federal grants made through the U.S. Department of Labor (DOL) have provided hundreds of millions of dollars over the past five years to support the expansion of apprenticeship into nontraditional sectors and to reach populations historically underserved by apprenticeship opportunities. Increasingly, state legislatures and governors have signaled their endorsement of apprenticeship expansion by funding their own grant initiatives to support program development and startup. According to the National Conference for State Legislatures, seven of the 30 states that have enacted apprenticeship legislation since 2016 have included some form of startup grant funding in their new laws,² while governors in Florida, New York, Pennsylvania, and North Carolina have also announced grant initiatives to catalyze employer interest and scale up apprenticeship offerings.

Hundreds of millions of dollars in federal grants have supported the expansion of apprenticeship into nontraditional sectors. Increasingly, state legislatures and governors have funded their own apprenticeship grants as well.

In New Jersey, a two-pronged startup grant initiative is a central component of Governor Phil Murphy’s apprenticeship expansion strategy. Part of a $10 million investment announced in 2018 to support the New Jersey Apprenticeship Network, the Growing Apprenticeship in Nontraditional Sectors (GAINS) and Pre-Apprenticeship in Career Education (PACE) competitive grant initiatives target different parts of the apprenticeship ecosystem with the goal of enabling statewide connections between apprenticeship, K–12 schools, higher education, and the business community. The $4.5 million GAINS initiative supports both existing and in-development apprenticeship programs looking to expand enrollment and reach into nontraditional sectors,³ paying for materials and supplies, tuition and instructor salaries, and the wages of qualified mentors, as well as up to half of an apprentice’s wages (which must be $15 per hour or more) for up to six months. PACE grants, announced in January 2019, will provide $3 million to support pre-apprenticeship,⁴ a distinct but related area of the apprenticeship ecosystem, to help build a pipeline of qualified applicants.

Because startup grant initiatives provide program-focused funding that can be used for instructional costs as well as for coalition-building and awareness campaigns, they are especially useful for catalyzing new programs in nontraditional fields. By targeting two- and four-year colleges and school districts in addition to employers and intermediaries, moreover, as New Jersey has done with GAINS funding, startup grants can attract new educational stakeholders who might not consider apprenticeship otherwise. In this study, ambitious startup investments were also underway in Pennsylvania, where $7 million of the state’s PAsmart STEM grants are targeted at Registered Apprenticeship, and in California, where the California Apprenticeship Initiative benefitted from a $15 million investment in the 2017–2018 fiscal year alone.

Despite their short-term advantages, however, grant initiatives that are not supported by recurring state appropriations may be liable to produce a flurry of short-lived projects. Karen Morgan, director of Wisconsin’s Bureau of Apprenticeship, is cautious about their long-term value. “When the money’s gone, will the programs go too?” she wonders. The risk of backsliding on apprenticeship expansion is acute if states do not develop systems to consistently fund apprenticeship in the long term.