Massive subsidies for apprenticeships in recent years have led to windfall effects, according to a public spending review released this week. It recommends savings of more than €1 billion.
It is a symbol of Macron’s employment policies, but also a significant source of savings for the future government, whoever it may be. Heavily subsidized since 2020 in order to boost the employment rate, apprenticeships and professional training are also at the heart of one of the spending reviews ordered at the end of 2023 by the Prime Minister of the time, Elisabeth Borne, to identify sources of budgetary savings.
She was well acquainted with the subject, having herself, as Minister of Labour, considerably increased these subsidies, by around 50%. The government was then aiming for one million apprentices (a record was reached in 2023 with 852,000 people), but at the cost of a windfall effect for companies that has been denounced several times, notably by the economist Bruno Coquet who considers a good part of this expenditure as “perfectly inefficient”. How big is the expenditure? In their conclusions, issued in March but made public this week, the General Inspectorate of Finance (IGF) and the General Inspectorate of Social Affairs (IGAS) estimate it at 14.4 billion for apprenticeships in 2022, almost double the figure for 2020 (7.9 billion). And at 16.1 billion euros for vocational training in the same year, an increase of more than a third over two years.
Savings targets
In their conclusions, the two services also highlight the existence of these “windfall effects”, especially concerning the hiring of apprentices following bachelor’s or master’s level training, who generally have less difficulty integrating into the world of work. In total, they recommend cutting nearly 1.1 billion euros from apprenticeships, while generating 420 million euros in revenue. Enough to achieve the savings targets that Elisabeth Borne’s government had set for itself.
Listed in a table, several measures would help achieve this. Mainly, the authors recommend “remove the bonus for levels 6 (bachelor’s degree) and 7 (master’s degree) for companies with 250 employees or more”. In other words, no longer paying 6,000 euros per apprenticeship contract to companies of this size that use apprentices with a bac + 3 level or higher. This would generate 554 million in savings in 2025.
Package already applied to the CPF
At the same time, the document recommends involving apprentices themselves, or rather their parents – since they are often attached to their tax household – by submitting their remuneration to income tax, for a “maximum gain of 459 million euros” which would mainly affect, the authors argue, the wealthiest households. But also by lowering the threshold at which exemptions from employee social security contributions on apprentice salaries cease. Nearly 280 million euros could be collected by lowering this threshold from 0.79 minimum wage to 0.5 minimum wage.
Vocational training represents a less abundant reservoir of savings in the eyes of the IFG and the Igas: they suggested making cuts of 420 million euros. One of their recommendations has already been implemented by the government of Gabriel Attal: the establishment of a co-payment on the personal training account. Since May 1, a flat rate of 100 euros has been applied to anyone using this tool to follow a training course, notably excluding job seekers and employees whose employer contributes to the training. A measure that goes beyond the recommendation made by the IGF and the Igas, which mentioned a modulation so that the flat rate goes from 30 to 80 euros per training course.
