Apprentice Wage Rates: Extent, Determinants and Implications

Abstract

This report provides findings from an in-depth survey conducted at 72 local businesses clustered around commercial markets located across Ganta, Gbarnga and Monrovia Cities of Liberia. The aim of the study is to provide a better understanding of wage rate business proprietors pay employees, which are classified in the study as entry level apprentices without soft skills, entry level apprentices with soft skills, entry level employees, and experienced employees. Our study shows that business owners place a very high wage premium on apprentices with soft skill training than with new apprentices without soft skill training with later earning significantly lower wages. The study found entry level employees with the PROSPECTS soft skills training earning significantly higher (Ganta $58, Montserrado $52, Gbarnga $50) than entry level apprentices without PROSPECTS soft skills training (Ganta $37 monthly, Gbarnga $25 monthly, Montserrado $14 monthly). A challenge mentioned by majority of business owners is the prevalence of unskilled and untrained workers within our sampled respondents. The study shows very experienced employees at Montserrado earn a lot higher at $166 when compared to entry level employee wages of $52. Experienced employees at Gbarnga also earn considerably higher at $63 than entry level employee wages of $50.4 Findings from the sampled businesses across the three counties show a few businesses commit funds in addition to PROSPECTS subsidy of $70 towards stipend for apprentices participating in the three months placement. We found a few apprentices on placement supported by businesses with 15$ at Montserrado, Gbarnga apprentices $24, and Ganta apprentices $17 monthly. PROSPECTS apprentices not only receive soft skills treatment but also get work experience after the three months placement, and this prepares the youths towards better employment opportunities. Our study shows that businesses are proliferating at a faster pace since phase 11 PROSPECTS intervention ended mid-2017, with 28.75% of surveyed businesses newly established in the last three years. This has meant an increase in businesses employing workers between 3 and 6 in number in the localities surveyed. Findings also show a poor percentage of businesses at 50% can pay workers on time which likely impacts on work motivation and attitude to work of employees. For over half of business owners, there are difficulties with training employed staff with identified skills gaps, despite business owners commonly stating employees need marketing training to enable higher turnover of goods on sale. Only 5.56% of business employers financially support employees with needed training and skills, with 89% of employers suggesting staff have low business and work-readiness skills. General perception of business owners is that ventures are profitable with 77.78% of the sample with this view and difficulties noted with 63% of businesses not owning business premises where transactions take place. The report concludes by making certain recommendations, some of which are straightforward to implement.