Apprenticeship in France

The apprenticeship reform of 2018  

When Emmanuel Macron was elected president of France in May 2017, the unemployment rate of the population segment aged 15-24 was 24.6%. Apprenticeship was seen as a key lever to reduce unemployment in this age group, and a reform to support its development was implemented in 2018. 

The reform aimed to develop apprenticeships in France to improve the integration of young people into employment. Key aspects included:  

• Liberalization of opening rules for formation centers (centres de formation d’apprentis, or CFAs) (resulting in a strong increase in the number of centers; more than 27% per year between 2018 and 2020)  

• An extension of the age cutoff for students from 25 to 29 

• Creation of France compétences, an institution dedicated to professional training and education and in charge of piloting and regulating the financing of it at the national level 

• A level of coverage called niveau de prise en charge (NPEC) per student, which is now defined in consultation with the 200 professional branches through the National Joint Employment Commissions and Commissions Paritaire Nationales pour l’Emploi  

This reform was a major success, with the number of apprenticeship and professionalization contracts growing from 494,000 to 799,000 between 2018 and 2021 (c.18% per year), as seen in Figure 1 below. It led to approximately 336,000 additional students in three years, mostly driven by apprenticeship contracts, the focus of the reform. As of Q2 2022, the unemployment rate in the population segment aged 15-24 was down to 17.8%, a 6.8 percentage point decrease compared with Q2 2017. From our experience in the sector, companies and students are pleased with this reform and the opportunities it provides.  

Historically, apprenticeship was one of the few education segments impacted by economic crises (given companies’ involvement in the system). However, during COVID-19, the government’s “1 jeune, 1 solution” plan strongly supported apprenticeship through exceptional aid of €8,000 per apprentice recruited.  

Furthermore, in June 2022, the government reiterated its intent to support the development of apprenticeships, aiming for 800,000 contracts in 2022 and 1 million contracts per year by the end of the presidential term in 2027.  

It should be noted that a significant share of growth in apprenticeship contracts comes from the “Bac+2” (associate degree) level and above, while the government aimed primarily to develop lower levels, which could lead to some adjustments in the future (see Figure 2). 

Funding implications of the reform 

The success of the apprenticeship reform has resulted in significant financing needs. To mitigate the reform’s impact and limit France compétences’ deficit, the April 2020 report from Inspection Générale des Affaires Sociales (IGAS) and Inspection Générale des Finances suggested, among other measures, that the professional branches lower the NPECs of apprenticeship contracts by an average of 3% per year between 2020 and 2023. 

In a release published in 2022, IGAS estimated the deficit of France compétences at €3.4 billion in 2021 and expects it to reach c.€6 billion for 2022 (Editor’s note: France compétences is also in charge of the Professional Training Account) (see Figure 3). 

July-September 2022 trends 

France compétences regularly publishes NPECs, which depend on the type of training (as listed in the Répertoire National des Certifications Professionnelles) and the professional branches. These NPECs are set by the professional branches, while France compétences makes recommendations only if the NPECs differ materially from the estimated cost of the training. 

NPEC values were published in November 2022 and before that in September 2022 and July 2022. In the September 2022 update, 44% of NPECs had increased, while only 33% had reduced, compared with July (see Figure 4). 

In July 2022, France compétences issued recommendations on nearly 12,000 NPECs, proposing a decrease in value for almost two-thirds of them (Graph 1 of Figure 5); these recommendations also included the new values proposed by the professional branches. In the NPEC update of September 2022, only half of these c.12,000 NPECs had their values effectively modified, and the majority have seen an increase in value between July and September 2022 (Graph 2 of Figure 5). 

France compétences published another set of recommendations in October 2022 on 6,000 NPECs.  

When looking into the France compétences recommendations, we see that: 

• While the recommendations of the professional branches (on the c.12,000 NPECs covered in July) are mostly higher than the real evolution between July and September, France compétences’ recommendations are lower. 

• The value of the NPECs where France compétences recommended a strong decrease remained mostly stable between July and September. 

• In October’s recommendations, 5,000 out of the 6,000 recommendations were on NPECs that were part of July’s recommendations. Values for 99% of them did not evolve between July and September. The new recommendations from France compétences on these 5,000 are mostly above July’s recommended value, and none have experienced a decrease. 

The trend seems to show that despite France compétences’ deficit, the objective remains to support the system and avoid strong cost reduction that could disrupt the system and threaten the objective of reaching 1 million students in 2027. 

July’s recommendations of the professional branches and France compétences vs actual evolution between July and September 

Figure 6 provides a comparison of the actual evolution of the NPECs released in September (abscissa) and the July recommendations (ordinate) with, on the one hand, modifications recommended by the professional branches (green dots in Figure 6) and, on the other hand, by France compétences (yellow dots in Figure 6). 

The actual variations in the NPEC values are mostly below the recommendations of the professional branches (green dots above the black diagonal), while they are overwhelmingly above the recommendations of France compétences (yellow dots the black diagonal). 

On the NPECs for which France compétences recommended strong reductions, the values were usually not modified  

We compared the recommendations of France compétences (abscissa) and the professional branches (ordinate), distinguishing between cases where the NPECs were changed between July and September 2022 (orange dots in Figure 7) and cases where the NPECs remained unchanged (gray dots). 

Given the origin of these analyses (France compétences recommending changes to NPECs), it is logical that, with very few exceptions, France compétences’ recommendations are lower than those of the professional branches (a few dots below the black diagonal). 

Out of the c.12,000 recommendations issued, the NPECs that did not vary are those on which France compétences recommended significant reductions (left part of the graph). 

October 2022 recommendations 

In October 2022, France compétences and the professional branches issued new recommendations on c.6,000 NPECs, of which c.5,000 (roughly 80%) were for NPECs that had already received recommendations in July.  

Of those c.5,000 recommendations, 99% of the NPECs involved did not undergo any changes between July and September 2022. We also note that more than 90% of France compétences’ recommendations in October have a higher value than in July, while less than 10% of the recommendations have not changed and no recommendation has a value lower than the level proposed in July. Of the remaining c.1,000 NPEC recommendations proposed in October (with no recommendation in July), the majority were for an increase in value compared with actual September levels: 46% of recommendations for an increase in NPEC value, 26% for a reduction (see Figure 8).

We also observe an increase in the recommendations of France compétences between July and September (see Figure 9 above). 

It can be noted that 42% of France compétences’ recommendations in October relate to a reduction in NPECs, down from 68% in July; on the contrary, recommendations of the professional branches were completely unchanged between July and October (see Figure 10). 

Review of latest developments — September-November 2022 

The latest NPEC values were published in November 2022. Only 3% of NPECs have seen their value rise, and 4% saw reductions compared with September. The vast majority (93%) of NPECs are unchanged (see Figure 11). 

Between these two NPEC updates, France compétences issued recommendations on nearly 6,000 NPECs in October 2022. It recommended a decrease in value for 42% of them and an increase for 31% of them from their September levels (Graph 1 of Figure 12). 

In the latest update (November 2022), 82% of these c.6,000 NPECs had their values effectively modified, with 40% seeing growth and 42% a reduction (Graph 2 of Figure 12).

Conclusion 

The latest trend seems to confirm that despite France compétences’ deficit and recommendations for NPEC reduction, the objective remains to support the apprenticeship system and to avoid any strong cost reduction in NPECs that could disrupt the system and threaten the government’s objective of reaching 1 million students in 2027.