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Fostering Talent- Setting Up MSME Apprenticeships

Learn to launch an apprenticeship program in the MSME sector—a step-by-step guide for skill-building success.

The Micro, Small, and Medium Enterprises (MSME) sector plays a crucial role in fostering economic growth and creating employment opportunities. As these businesses strive to remain competitive in an ever-evolving market, investing in skilled labor becomes paramount. One effective strategy to address this need is establishing an apprenticeship program.

Apprenticeships bridge theoretical knowledge and practical experience, equipping individuals with the skills and expertise necessary for success in their chosen fields. Moreover, such programs benefit MSMEs by ensuring a continuous pipeline of skilled workers and reducing recruitment costs.

With the recent changes to the Apprenticeship Act, micro, small, and medium-sized enterprises (MSMEs) have greater opportunities to attract and retain talent by employing them as apprentices. According to the All-India Census, there are 13 million MSMEs in the country, and this sector employs 41.0 million people. Even if each business employs at least one apprentice, the total number of apprentices will increase dramatically based on these numbers. 

How do we make MSMEs more open to hiring apprentices?

Small-scale businesses need people with a lot of skills. There are different ways in which we try to fulfill this need. But we still have a long way to go. We need to make small businesses understand the program's value proposition. A company can hire educated and skilled people from the ecosystem as apprentices under the Act, train them on their shop floor processes, evaluate their strengths and weaknesses, and then hire them if they are a good fit. The apprenticeship program also has a high return on investment.

MSMEs can see why hiring students is a good idea if they get some counseling. MSMEs must realize that taking on trainees only adds a little work to their plates. They need to use the apprenticeship window instead of their traditional hiring process, in which they hire people who need more time on the shop floor to get to know their strengths and flaws.

Often, a mismatch leads to high turnover and the need to re-hire or re-train people. There is a cost to this too. Instead, they can train trainees based on their needs and pay them 70% of the minimum wage, which the law says must be done. Even if they have to pay them a little more in the form of a stipend than they might pay a new employee (which might be less than the minimum wage and therefore illegal), the overall rate of return on investment is better if they go the apprenticeship route. It helps them stay on the right side of the law, which is good.

Further, the EPF and ESI do not apply to apprentices working under the Apprenticeship Act. On top of that, they get paid back up to Rs. 1500 per apprentice per month for the stipends they give trainees. Also, they hire skilled people, not people who are just learning on the job. This improves the quality of what they sell or do.

The steps involved in starting an apprenticeship program in the MSME sector.

Identify the Need: Determine the specific skills and workforce requirements for your micro, small, or medium-sized enterprise (MSME). Evaluate the areas where you need more talent or expertise and determine which roles would be appropriate for apprenticeship programs.

Describe Apprenticeship Functions: Define the duties and responsibilities of apprentices within your organization in detail. In addition, provide an overview of the tasks participants will be required to perform and the skills they will acquire as part of the program.

Set up Partnership: Establish partnerships with educational institutions, training centers, and businesses that offer relevant apprenticeship programs. It is recommended that, to gain information, resources, and apprentices that will help you partner with these organizations.

Develop a Training Program:
  • Make an apprentice training plan with curriculum and goals.
  • Find out what they'll study in the program.
  • In the training plan, include both theoretical and practical components.

Regulation Compliance: Learn about the legislation and legal requirements for apprenticeships in your area. Ascertain that your program complies with all applicable labor laws, apprenticeship frameworks, and any other requirements concerning salaries, working hours, and workplace safety.

Establish Duration and Structure: Determine the length of the apprenticeship program. Apprenticeships often last from six months to several years, depending on the difficulty of developing skills. Determine whether the apprenticeship will be full-time or part-time as well.

Recruit Apprentices: Post apprenticeship openings on job boards, career fairs, and educational institutions, among other places. Conduct a structured screening process to find applicants who fit your organization's needs and culture well.

Onboarding and Induction: Once chosen, give the apprentices a thorough onboarding and induction process. Inform them of the company's rules, processes, safety protocols, and working environment. A mentor or supervisor should be assigned to advise and support them throughout the program.

Implement the Training Program:
  • Put the training plan you created earlier into action.
  • Provide a mix of classroom teaching, hands-on experience, and mentorship.
  • Allow apprentices to practice their abilities in real-world circumstances and gradually expand their responsibilities.

Regular Evaluation and Feedback:

  • Continuously assess the trainees' growth and performance.
  • Give them regular comments and directions to help them improve their skills.
  • Conduct regular evaluations or assessments to track their progress and identify areas for improvement.

Certification and Completion: Once the apprentices have completed the program, award them a certificate or other recognition for their efforts. This accreditation will enhance their CV and assist them in their future employment ambitions.

Transition to Employment: At the end of the program, evaluate the apprentices' performance and potential. Consider hiring people with proven extraordinary abilities, commitment, and a strong match with your firm for full-time positions.

Remember, these steps provide a general framework for starting an apprenticeship program in the MSME sector. The specific process may vary based on location, industry, and circumstances.

Wrapping Up

Apprenticeship programs in the MSME sector present a win-win situation for businesses and individuals seeking to enhance their skills. By investing in such initiatives, MSMEs can develop a competent workforce, contributing to their growth and competitiveness. Moreover, these programs offer aspiring professionals a unique opportunity to gain hands-on experience, paving the way for a rewarding career.

Starting an apprenticeship program in the MSME sector requires careful planning, collaboration with key stakeholders, and a commitment to providing quality training and support. By assessing business needs, building partnerships, designing a well-structured program, recruiting the right apprentices, and providing ongoing guidance, MSMEs can lay the foundation for a successful apprenticeship initiative that fuels growth and contributes to workforce development.

At 2COMS, we are committed to helping companies reach their hiring targets while staying in sync with their overall business objectives. Maximize your company's potential with our top-notch apprenticeship training services. Our team of experts will guide you through the process, ensuring full compliance with labor laws and securing government payments for hiring apprentices. Trust us to help your business thrive. Unlock your organization's full potential with 2COMS! Contact us today to learn more about how we can help you excel in your field.

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