Cash cow for employers, exorbitant cost for the State… Apprenticeships are taking another hit

The government has just decided to make a major cut to one of President Macron's key measures to combat unemployment. In an attempt to save between €93 million and €140 million on apprenticeships, the total cost of which to the state budget has been estimated at €14 billion per year by the Court of Auditors and at nearly €25 billion by the French Economic Observatory (OFCE) , the Minister of Labor has announced that companies will now contribute €750 to the training costs of each of their apprentices if they have a higher level of education than a bac + 3.

Another aspect of the cut is "the prioritization of apprenticeship funding based on the needs of the labor market," announced the Ministry of Labor, meaning the ability for professional branches to adjust training funding according to their needs. This should be accompanied by increased vigilance regarding the quality of teaching provided by apprentice training centers (CFA) and greater conditioning of the public aid paid to them. These changes are in addition to the decision taken in January to reduce the bonus granted for hiring an apprentice, which fell from 6,000 to 5,000 euros for companies with fewer than 250 employees and to 2,000 for those above the threshold of 250.

These announcements were greeted with caution by employers, who are very attached to this public support system for employers. The Confederation of Small and Medium-Sized Enterprises (CPME), in particular, warned in a press release against the risk of "breaking the momentum" of apprenticeships and "negatively impacting youth employment."

It must be said that since its expansion in 2018, apprenticeships have been, alongside other aid paid to companies without compensation, a real cash cow for employers. This has been especially the case since 2020 when, as part of the recovery plan, "exceptional aid" described as "very generous and untargeted" by an OFCE study was added to the contribution exemptions that already existed for work-study programs, making this form of hiring very economical for company management.

"Apprentices have become almost free labor for companies, which now prefer to hire apprentices rather than employees on permanent or fixed-term contracts, or even interns (e.g., students)," summarizes an analysis by the Union of Consular Agents and Apprenticeships SNCA-CGT. All at the taxpayer's expense, as no other type of employment has ever benefited from such a level of public money. "Public spending on apprenticeships reached 21 billion euros for the year 2022, up 270% since 2018," calculated economist Bruno Coquet, the author of the OFCE's notes on the issue . An exponential amount, the generosity of the aid having led to an explosion in the number of apprenticeship contracts, which rose from 290,000 in 2017 to 854,000 in 2024.

While these new restrictions are primarily aimed at reducing public spending, they also highlight other limitations of the apprenticeship system. Presented as a policy to combat youth unemployment , the latter is not actually achieving its objectives. "We see that when the amount of subsidies increases, companies hire more apprentices, but keep fewer of them," Pierre Cahuc, professor of economics at Sciences-Po, recently explained on France Culture . "The proportion of young people who stay in their company at the end of their apprenticeship is around a third."

Even more seriously, by expanding apprentice status and the payment of related aid to higher education students, the 2018 and 2020 reforms allowed companies to hire higher education students at low cost instead of offering them a real contract. This overrepresentation of students among apprentices has come at the expense of young people without employment or training, who benefit most from this integration into the world of work and whose share has continued to decline.

The announced measures also marginally address another problem linked to the explosion of apprenticeships highlighted by many observers: the anarchic development of a private education sector subsidized by the State, the quality of which leaves something to be desired . But they do so without ever questioning the underlying logic, which is that of indiscriminate aid to businesses.