How to Set Up an Apprenticeship Program for Your Trade Business

Your Pipeline Problem Has a Structural Fix — But Only If You Build It Right

You've posted the journeyman electrician job twice. The first round got you three applicants; one showed, two ghosted. The second round cost you another three weeks and a recruiting fee that stung. Somewhere between those two rounds, your foreman picked up a second crew just to keep the backlog moving — and he's running out of patience.

Here's what most contractors do next: post again, or poach. Here's what solves the problem at the root: build an apprenticeship program that turns green candidates into your own journeymen on a timeline you control.

The catch? "Informal" apprenticeship — where you hire a helper, pay them whatever feels right, and call it training — leaves real money on the table. Federal and state subsidies, tax credits, and workforce-grant programs are built around Registered Apprenticeship Programs (RAPs), and they require a documented structure to unlock. More importantly, a structured program with a clear wage-progression schedule is the thing that actually retains apprentices through year four instead of losing them to a competitor who made a better offer in year two.

This guide walks you through how to set up an apprenticeship program the right way — from deciding what kind of program to register, to building the wage schedule that keeps apprentices on board, to paperwork that opens the door to subsidy funding.

---

Understand What a Registered Apprenticeship Program Actually Is

A Registered Apprenticeship Program (RAP) is a formal training model recognized by the U.S. Department of Labor (DOL) — or by a State Apprenticeship Agency (SAA) in states that run their own programs. "Registered" is the operative word: it means your program meets DOL's standards and gets listed in the national apprenticeship database, which is what makes you eligible for federal funding, tax credits, and state workforce grants.

RAPs have five required components that DOL looks for:

1. Job-related technical instruction — classroom or online learning tied to the trade (theory, code, safety).
2. On-the-job learning (OJL) — structured, supervised hours in the field. Most trade apprenticeships run 2,000–8,000 OJL hours total.
3. A documented wage progression — apprentice wages that increase at defined intervals as competency grows (more on this below).
4. Mentorship — a qualified journey-level worker paired with each apprentice.
5. A certificate of completion — a nationally recognized credential issued at program end.

The distinction between a RAP and an informal training arrangement matters because the labor market can tell the difference. Data from the DOL shows that 94% of Registered Apprenticeship completers are employed at program completion, with average starting wages above $70,000 per year. Registered apprentices who complete programs averaged about $18/hr at entry and $32/hr at completion — a 77% increase over the program term (DOL, via Community College Daily). Those outcomes are partly a selection effect, but they're also what a structured, credentialed program produces.

For a deeper look at how occupational skill levels map to training requirements, see our guide to O*NET Job Zones explained for trades — the same framework DOL uses to define what "qualified" looks like in each occupation.

---

Step 1 — Choose Your Registration Path

You have two options:

Option A: Register directly with DOL's Office of Apprenticeship (OA). This works in states without a State Apprenticeship Agency. You work with a DOL regional office, submit your program standards, and get a DOL certificate of registration.

Option B: Register with your State Apprenticeship Agency. Twenty-five states (and the District of Columbia, at the time of writing — verify the current list at apprenticeship.gov) operate their own SAAs and handle registration locally. State programs must meet federal minimum standards but may have additional requirements. The upside: many state programs have faster approval timelines and their own grant layers on top of federal funding.

Which path is right for you? Start at apprenticeship.gov — DOL's employer portal. It will route you to the correct office based on your state and trade. If you operate across multiple states, you can hold a national program standard registered with DOL that covers all locations.

Sponsor vs. intermediary. You don't have to build the program alone. Joint Apprenticeship Training Committees (JATCs) — often run by trade associations or union-management partnerships — can sponsor a program on your behalf. If you're a smaller shop (under 25 employees), joining an existing multi-employer apprenticeship program as a participating employer is often faster than building your own from scratch. Your local JATC or trade association is the right first call.

---

Step 2 — Define the Occupation and Duration

Every RAP is tied to a specific occupation — in practice, a specific SOC code. SOC stands for Standard Occupational Classification; it's the federal system that groups jobs by what workers actually do. SOC codes matter here because they determine which apprenticeship standards apply, which wage data you anchor the progression to, and which O*NET job profile defines the competencies your apprentice must demonstrate.

For a specialty trade contractor, the most common RAP occupations are:

Occupation	SOC Code	Typical RAP Duration
Electrician	47-2111	4–5 years / 8,000 OJL hours
Plumber / Pipefitter	47-2152	4–5 years / 8,000 OJL hours
HVAC Mechanic & Installer	49-9021	3–5 years / 6,000–10,000 OJL hours
Welder	51-4121	2–5 years / varies by specialty
Carpenter	47-2031	3–4 years / 6,000–8,000 OJL hours
Sheet Metal Worker	47-2211	4–5 years / 8,000 OJL hours

DOL publishes approved time-based and competency-based program standards for most trade occupations — download the relevant standard from apprenticeship.gov before you write your own. You don't need to reinvent the framework; you customize it to your shop, your market, and your wage schedule.

---

Step 3 — Build Your Wage Progression Schedule

This is the piece most informal programs skip — and it's the piece that determines whether apprentices finish or leave.

DOL requires that apprentice wages increase progressively over the program term. The minimum starting wage for a federally registered RAP is the higher of your applicable minimum wage or 70% of the journey-level wage for the occupation. From there, wages must step up at defined intervals (typically every 6 or 12 months, or at defined competency milestones).

What does "journey-level wage" mean in practice? It's the BLS OEWS median (or a locally prevailing wage, if you're on prevailing-wage work) for the journey-level occupation. BLS OEWS is the Occupational Employment and Wage Statistics survey — the federal dataset that measures what employers actually pay, built from a sample of about 1.1 million establishments nationwide (BLS). For the trades above, the May 2024 national medians are:

• Electricians (SOC 47-2111): $62,350/yr (BLS, May 2024)
• Plumbers/Pipefitters (SOC 47-2152): $62,970/yr (BLS, May 2024)
• HVAC mechanics & installers (49-9021): $59,810/yr (BLS, May 2024)
• Welders (51-4121): $51,000/yr (BLS, May 2024)
• Carpenters (47-2031): $59,310/yr (BLS, May 2024)
• Sheet metal workers (47-2211): $60,850/yr (BLS, May 2024)

These are national medians. Your local journey-level rate may be higher or lower — always confirm with bls.gov/oes for the state or metro figure specific to your area before setting your progression anchor.

Worked example — a 4-year electrician RAP:

Say you anchor your journey-level wage to the national median of $62,350 (May 2024 BLS). A straightforward percentage-based progression might look like this:

Period	% of Journey-Level	Annual Rate (Example)
Year 1 (0–12 months)	50%	~$31,175
Year 2 (13–24 months)	65%	~$40,528
Year 3 (25–36 months)	80%	~$49,880
Year 4 (37–48 months)	90%	~$56,115
Completion (Journeyman)	100%	$62,350+

This is a worked example using a round percentage ladder and the BLS May 2024 national median as the anchor. Your actual schedule should be anchored to your local prevailing or BLS metro/state rate — confirm at bls.gov/oes — and reviewed with your DOL or SAA contact before finalizing.

Why does having this written down matter beyond compliance? Because an apprentice in year two who gets a $2/hr offer from a competitor can see, in black and white, what they're walking away from. A documented progression is a retention tool. For a full framework on structuring pay bands across all three levels — apprentice, journeyman, master — see our guide to apprentice, journeyman, and master pay bands.

---

Step 4 — Set Up Your Related Technical Instruction (RTI)

DOL requires a minimum number of Related Technical Instruction hours — typically 144 hours per year of the apprenticeship. RTI is the classroom component: electrical theory, plumbing code, HVAC refrigerant handling, welding metallurgy. You have three ways to deliver it:

1. Community college or technical school. Many already have DOL-approved trade curricula. This is the most common route for smaller employers — you pay tuition or co-sponsor the cost, and the school handles instruction.
2. Trade association or JATC training center. ABC, NECA, UA, SMACNA, and other associations run established RTI programs. If you're already a member, this is often the fastest path.
3. In-house instruction. Larger shops (50+ field employees) sometimes hire a training coordinator and build internal curriculum. This gives you the most control over content but requires the most administrative overhead.

Whichever route you choose, document the RTI provider, curriculum, and hour requirements in your program standards — DOL will ask.

---

Step 5 — Apply for Subsidies (and Know What You're Leaving on the Table Without Registration)

This is where informal programs lose real money. Federal and state programs that offset apprenticeship costs are generally available only to registered programs. Here's a landscape of what exists — verify current amounts and eligibility with the relevant agency before you budget around any of these:

Federal:

• Apprenticeship Building America grants (administered by DOL) — discretionary grants to expand and diversify RAPs. Award sizes vary by competition round; check grants.gov for active solicitations. [VERIFY current availability and amounts]
• Work Opportunity Tax Credit (WOTC) — a federal tax credit for hiring workers from certain target groups (veterans, individuals from economically disadvantaged backgrounds). Apprentices from eligible groups may qualify. Credits historically ranged from $1,200 to $9,600 per qualified hire depending on target group and hours worked — but WOTC's authorization lapsed for hires made after December 31, 2025 and has not been reauthorized as of this writing. [VERIFY — confirm current WOTC status and amounts with the IRS or a tax advisor before relying on this credit]

State-level:

• Most states with SAAs have their own apprenticeship grant programs — some reimburse RTI tuition, others pay a per-apprentice training stipend. Dollar ranges vary widely by state and funding cycle. [VERIFY — check your state workforce agency or your SAA contact at apprenticeship.gov]
• Some states offer additional employer tax credits for registered apprenticeship sponsors. Again, eligibility and amounts depend on state legislation that changes. [VERIFY with your state revenue or workforce agency]

The labor-shortage context matters here. Construction needed an estimated 439,000 net new workers in 2025 and an estimated 349,000 net new workers in 2026 (Associated Builders and Contractors). The funding programs above exist because policymakers know the pipeline problem is real — which means the political appetite to fund RAPs is higher than it's been in decades. Registered programs are positioned to capture that funding; informal arrangements are not.

For more on what's driving the demand side of this equation, see our overview of the skilled trades labor shortage in 2026.

---

Step 6 — Establish Mentorship Pairs and Program Administration

Every apprentice needs a designated journey-level mentor. DOL's standard is that the mentor must be qualified in the occupation and have enough bandwidth to supervise and teach — which in practice means you're not assigning one journeyman to four apprentices simultaneously and calling it mentorship.

Document your mentor assignments in writing. Track OJL hours — DOL requires apprentices to log their on-the-job hours, and your program records must be available for review. Most shops use a simple spreadsheet or a construction operations platform that has a training-hours module. You'll also need to file progress reports with your DOL or SAA contact at defined intervals (typically annually).

The administrative lift is real, but it's manageable for a shop with a part-time office manager or HR contact. Our Apprenticeship Program Setup Checklist pulls all the required documentation, forms, and filing steps into one place — so you're not discovering a missing requirement two weeks before your first apprentice's review date.

---

Closing: The Wage Schedule Is the Program

The six steps above are the framework. But the single thing that determines whether your apprenticeship program actually works — whether apprentices start, stay, and finish — is the wage progression schedule. Make it defensible (anchored to BLS data or prevailing wage), make it documented, and make it visible to every apprentice from day one.

For a deeper look at how to benchmark wages across the full career ladder in your trade, see our skilled trades wage benchmarking guide and explore SkilledMarkets' plans if you want a faster way to pull BLS OEWS percentiles by trade and geography without the spreadsheet gymnastics.

Download the Apprenticeship Program Setup Checklist to get every step, form, and filing requirement in one place — and start building the pipeline your next three seasons depend on.

---

This article includes information from O*NET OnLine, developed by the U.S. Department of Labor, Employment and Training Administration. O*NET is a registered trademark of the U.S. Department of Labor, Employment and Training Administration.