• TABLE OF CONTENTS
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 Front Cover
 Title Page
 Table of Contents
 Introduction
 Methodology
 The institutional setup of apprenticeship...
 Costs and returns to apprenticeship...
 Summary and policy implication...
 Bibliography
 Back Cover














Group Title: African rural economy paper
Title: An economic evaluation of apprenticeship training in western Nigerian small-scale industries
CITATION THUMBNAILS PAGE IMAGE ZOOMABLE
Full Citation
STANDARD VIEW MARC VIEW
Permanent Link: http://ufdc.ufl.edu/UF00086753/00001
 Material Information
Title: An economic evaluation of apprenticeship training in western Nigerian small-scale industries
Series Title: African rural economy paper
Physical Description: iv, 69 p. : ; 28 cm.
Language: English
Creator: Mabawonku, Adewale F
African Rural Economy Program
Publisher: African Rural Economy Program, Dept. of Agricultural Economics, Michigan State University
Place of Publication: East Lansing Mich
Publication Date: 1979
 Subjects
Subject: Apprenticeship programs -- Nigeria, Western   ( lcsh )
Small business -- Nigeria, Western   ( lcsh )
Genre: government publication (state, provincial, terriorial, dependent)   ( marcgt )
bibliography   ( marcgt )
non-fiction   ( marcgt )
Spatial Coverage: Nigeria
 Notes
Bibliography: Includes bibliographical references (p. 61-66).
Statement of Responsibility: by Adewale F. Mabawonku.
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Bibliographic ID: UF00086753
Volume ID: VID00001
Source Institution: University of Florida
Rights Management: All rights reserved by the source institution and holding location.
Resource Identifier: oclc - 06329512
lccn - 79625969

Table of Contents
    Front Cover
        Front Cover 1
        Front Cover 2
    Title Page
        Page i
        Page ii
    Table of Contents
        Page iii
        Page iv
    Introduction
        Page 1
        Page 2
    Methodology
        Page 3
        Page 4
        Page 5
        Page 6
        Page 7
        Page 8
        Page 9
        Page 10
    The institutional setup of apprenticeship system in Western Nigeria
        Page 11
        Page 12
        Page 13
        Page 14
        Page 15
        Page 16
        Page 17
        Page 18
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        Page 22
        Page 23
        Page 24
        Page 25
        Page 26
        Page 27
        Page 28
        Page 29
        Page 30
    Costs and returns to apprenticeship training
        Page 31
        Page 32
        Page 33
        Page 34
        Page 35
        Page 36
        Page 37
        Page 38
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        Page 48
        Page 49
        Page 50
        Page 51
        Page 52
    Summary and policy implications
        Page 53
        Page 54
        Page 55
        Page 56
        Page 57
        Page 58
        Page 59
        Page 60
    Bibliography
        Page 61
        Page 62
        Page 63
        Page 64
        Page 65
        Page 66
        Page 67
        Page 68
    Back Cover
        Page 69
        Page 70
Full Text



















AN ECONOMIC EVALUATION OF APPRENTICESHIP TRAINING IN
WESTERN NIGERIAN SMALL-SCALE INDUSTRIES*














by

Adewale F. Mabawonku**


*This paper has been published as part of Michigan State University's
Off-Farm Employment Project, which is financed by the Office of Rural
Development and Development Administration, Development Support Bureau,
U.S. Agency for International Development (AID/ta-CA-2).

**Lecturer, Department of Agricultural Economics, University of
Ibadan, Ibadan, Nigeria.








TABLE OF CONTENTS

Page

1. INTRODUCTION . . . . . . . . ... . . . 1

1.1. Objectives of the Study . . . . . . . . 2
1.2. Study Outline . . . . . . . ... . . 2

2. METHODOLOGY . . . . . . . ... . . . 3

2.2. Area of Study . . . . . . . ... . . 3
2.3. Industry Selection . . . . . . . . . 3
2.4. Sampling Procedure . . . . . . . . . 5
2.5. Data Collection . . . . . . . . . . 6
2.5.1. Data Collection in Large-Scale Industries . . 8
2.5.2. Data Collection in Trade Schools . . . . 9
2.6. The Shortcomings of and the Problems Associated
with Study . . . . . . . . . 9

3. THE INSTITUTIONAL SET-UP OF APPRENTICESHIP SYSTEM IN
WESTERN NIGERIA . . . . . . . ... . . . 11

3.1. The Apprenticeship System . . . . . . .... 15
3.2. The Organization of Training . . . . . .... .22
3.3. Apprentice Fees . . . . . . . . . . 23
3.4. Training Programs in Trade Centers . . . . .. 27

4. COSTS AND RETURNS TO APPRENTICESHIP TRAINING . . . ... 31

4.1. Components of Costs of Apprenticeship Training .... 32
4.2. Cost of Training in Trade Centers . . . .... .36
4.3. Estimates of Benefits . . . . . . . .... .42
4.4. Estimates of Internal Rates-of-Returns . . . ... 44
4.5. Rate-of-Return in Wage Employment . . . . .... .44
4.6. Rate-of-Return in Self-Employment . . . . . . 48
4.7. Adjusted Social Rates of Return . . . . ... 50

5. SUMMARY AND POLICY IMPLICATIONS . . . . . . .... .53

5.1. Implications for Apprenticeship Training . . ... 57
5.2. Implications for Trade Centers . . . . .... 59
5.3. Implications for Further Research . . . . .... .60

BIBLIOGRAPHY . . . . . . . . ... ...... . .61







LIST OF TABLES


Table

2.1. Sampling Frame and Size Number of Establishments

3.1. Percentage Distribution of Apprentices by Age . .

3.2. Distribution of Apprentices by Years of Education. .

3.3. Distribution of Apprentices According to Father's
Occupation . . . . . . . . . .

3.4. Job Experience of Apprentices Prior to Training . .

3.5. Distribution of Apprentices According to Length of
Unemployment Prior to Training . . . . .

3.6. Distribution of Apprentices According to Who Made the
Decision for Them to be Apprenticed . . . .

3.7. Distribution of Apprentices by Type of Contract
Signed with Proprietors . . . . . . .

3.8. Relationship Between Masters and Apprentices . . .

3.9. Average Apprenticeship Fees and Allowances (in Naira)
by Industry and Location . . . . . .

3.10. Trade Centers in Western Nigeria: Student Population


Page

. . 7

. . 12

. 13


. . 14

. . 16


. . 17


. . 20


. . 21

. . 25


. . 26


by Course .


. . . . . . . . . . . 29


4.1. VMP and Opportunity Costs of Inputs Used in
Apprentice Training . . . . . . . .... 35

4.2.A Cost Components Tailoring . . . . . . .... 37

4.2.B Cost Components Furniture Craft . . . . . .... 38

4.2.C Cost Components Auto Repair . . . . . . ... 39

4.3. Cost Components Trade Centers . . . . . .... 41

4.4. Distribution of Annual Returns (N) to Proprietors
by Years of Experience . . . . . . . .... 43

4.5. Private and Social Internal Rates-of-Return in
Wage Employment . . . . . . . .... ... .. 45

4.6. Private and Social Internal Rates-of-Return
for Self-Employment for Apprentice Training
by Industry and Location . . . . . . .... 46

4.7. Adjusted Social Internal Rates-of-Return by Industry .... .51








1. INTRODUCTION


Many developing countries are undertaking concerted efforts to promote

the growth of small-scale industries. Local policymakers, as well as

international agencies, view both horizontal multiplication of small

nonfarm industries and their vertical integration within the economic

structure as key strategies to help reduce unemployment and to usher in an

industrial structure consistent with the factor endowments of these

countries.

The establishment of a small-scale industrial subsector requires

skilled craftsmen or workers who can perform various specialized activities.

Its ability to grow therefore depends on the development of institutions

to train workers. In many countries in Africa, the training of small-scale

industrial entrepreneurs has been approached by the establishment of trade

schools, handicraft centers, and vocational institutes. At the same time,

proprietors in the small-scale industries offer a training program based on

the system of apprenticeship. Whereas the government-established institu-

tions are formal, apprenticeship training in the private sector is often

informal and on-the-job. Given these alternative methods of training

workers for the small-scale industries, important questions which arise in

the allocation of the society's resources center on what the yields are

from these alternative approaches as well as the yields from the different

skills or trades available in the subsector. Another question is the

appropriateness of the skills being taught to the type of productive

structure envisaged in the future, especially to the needs of the small-

scale sector if expansion of this sector is being emphasized.








1.1. Objectives of the Study

In broad terms this study will focus on analyzing the structure,

conduct, and performance of the apprenticeship system in Nigeria. Bearing

in mind that the concern is the relationship between training and perfor-

mance, the focus will be on such specifics as

1. a description of the apprenticeship system as an institution

for skill acquisition

2. analysis of the economics of apprenticeship training, and

comparative evaluation of returns for apprenticeship system and trade

school training

3. recommendations of policies regarding training of small-scale

industry entrepreneurs


1.2. Study Outline

In section 2, the approaches used in data collection, including the

selection of area of study, the choice of industries, and the sampling of

establishments and procedure used to collect the data are presented. In

section 3, the institutional setup of the apprenticeship system, as well as

that of the trade schools together with the economic and social environment

in which small-scale entrepreneurs carry out both production and training,

is detailed. Section 4 presents estimates of the costs and returns to

apprenticeship and trade school training. The last section, section 5,

summarizes the findings of the previous sections and contains recommendations

for promoting small industries in Nigeria.









2. METHODOLOGY


2.2. The Area of Study

This study of the apprenticeship system in Western Nigeria was

carried out from April to December 1976. Budgetary and logistic constraints

limited the selection to three locations. The choice of locations was based

on population settlements and educational facilities in Western Nigeria.

The three locations selected were Oyo, Ijebu-Ode, and Aiyepe. Oyo township

has a population of nearly 500,000 and contains a trade school and a number

of secondary schools; it is located thirty-three miles north of Ibadan.

Ijebu-Ode, population 200,000, also has a trade school, a "comprehensive"

college, and no less than twelve secondary schools. While Oyo, which is an

urban area, has a sizable agricultural population, the majority of the

population in Ijebu-Ode is in commerce. To facilitate a comparative analy-

sis between urban and rural areas, Aiyepe, a rural town with a population

of less than 50,000, was also chosen. Both Ijebu-Ode and Aiyepe are situ-

ated forty and fifty miles, respectively, south of Ibadan.


2.3. Industry Selection

Official statistics in Nigeria generally deal with industries

employing ten or more people, thus excluding thousands of other small enter-

prises which employ fewer than ten workers. Buchanan [1950] found that

there were 2,700 establishments distributed among 14 categories in Ibadan

alone in 1949. In a more comprehensive survey of industrial units in

Ibadan, carried out in 1961 and 1963, Callaway [1961, 1963] counted a total

number of 5,135 establishments distributed among 15 categories with a total

employment of 14,500 persons. A similar work by Kilby in 1961 produced








10,728 firms employing 28,721 workers in 14 towns in Eastern Nigeria

[Kilby, 1962]. Recent attempts include the work of Koll [1969], who

estimated 1,427 establishments and an employment figure of 27,698 in

Ibadan township, and the Industrial Research Unit of the University of Ife,

which produced estimates of establishments and employment figures for

20 towns in Western Nigeria.

The industries identified by these studies range from traditional

ones, such as blacksmithing, weaving, and pottery, to modern industries

among which are tailoring, auto repair,carpentry, and photography.

Apprenticeship in the more traditional industries is always restricted to

only the members of the household and is often subject to many taboos and

rituals. On the other hand, apprenticeship in the modern industries is less

personalized and more often than not reflects the labor market situation and

the returns to labor in the subsector. Given this situation, the choice of

industries in this study was restricted to the more modern ones and was

also based on the relative importance of these industries. The industries

thus identified are auto repair, furniture craft or carpentry, and

tailoring.

For the purpose of this study, the following definitions are adopted.

"Number of establishments" means the number of manufacturing plants. "Number

employed" includes all persons engaged in the production activities of the

establishment whether they were paid or not. Thus it includes the proprie-

tor, members of his family working in the plant, and paid workers such as

journeymen and apprentices. Tailoring, mechanics, and furniture craft have

been used to describe an array of industries producing diverse products.

This no doubt has led to a lot of confusion in many studies of small

industries. Tailoring described those engaged in sewing and knitting.









Furniture makers and carpenters cannot be readily distinguished in Nigeria.

Both engage in the production of finished goods such as tables and chairs,

and also engage in construction activities such as roofing houses and

building homes. Hence this study does not distinguish between the two, but

will refer to workers in this industry as furniture makers. Mechanics

refers to those engaged in auto repair and, as such, excludes welders, tire

repairers, and painters.


2.4. Sampling Procedure

Sampling from any population is dependent on the information about

that population, the purpose of the exercise, and the funds available. In

Western Nigeria as well as in other parts of the country, no accurate and

up-to-date information is available about the population of small-scale in-

dustries. This makes drawing a sample impossible. Ideally, one can take a

complete enumeration of the population and from this framework draw a

sample. But given the funds available for this study, that, too, was

impossible.

The sample frame is defined as the number of establishments in

tailoring, auto repair, and furniture craft in Oyo, Aiyepe, and Ijebu-Ode

engaging one or more apprentices. To get a sample that will provide a

reasonable estimate for the population in each locale, the following proce-

dure was adopted. From the University of Ife survey, a list of names and ad-

dresses of every establishment in the industries covered in the survey was compiled

for Oyo and Ijebu-Ode. (The survey did not cover Aiyepe.) Each establish-

ment on the list in each town was visited. The proprietors of the

establishment were asked whether or not they had an apprentice in their

establishment. They were also asked to name a minimum of five other








establishments similar to theirs in their neighborhood. These were written

down and compared with the list being used. The exercise lasted about two

weeks. The names of establishments not on the list were added to it, and

proprietors or establishments which could not be located were deleted. By

visiting the proprietors on the list to ascertain whether they had appren-

tices, a list of establishments with apprentices was compiled. Thus a

rough but ready frame was obtained. From this frame a random sample of

establishments was drawn. The number of establishments selected was based

on the number in the frame and, except for tailoring, was set at between

50 to 70 percent for each industry category to give a reasonable number of

observations. The resulting sample size is shown in table 2.1.

For Aiyepe area no reliable previous survey exists; hence a total

enumeration of the area had to be undertaken. It was discovered that there

were only two auto repair establishments, four furniture craft workers, and

just sixteen tailors in Aiyepe township itself. To obtain a large enough

sample size, the small neighboring towns of Odogbolu and Ikenne had to be

included.


2.5. Data Collection

Collection of data in the small industries was carried out in two

phases. The first phase, designed to provide information about the appren-

ticeship system and the participants in the training, involved the use of

appropriate questionnaires to obtain detailed information from proprietors

and apprentices. Each questionnaire was administered by an enumerator at

one interview, and different forms were used to interview apprentices and

proprietors. Apprentices were interviewed when their masters were not

around in order to obtain confidential information about apprentice-proprietor

relationships and especially information about fees and allowances.








TABLE 2.1

SAMPLING FRAME AND SIZE NUMBER


OF ESTABLISHMENTS


Ife Directory Compiled Sample Percentage
Location Industry Frame Frame Covered Sampled
(A) (B) (C)


Ijebu-Ode Furniture Craft 29 65 37 56.92

Auto Repair 26 43 23 53.48

Tailoring 437 421 28 7.13


Oyo Furniture Craft 38 29 18 62.07

Auto Repair 16 40 30 75.00

Tailoring 146 173 30 17.34


Aiyepe Tailoring N.A.* 69 44 63.77


*N.A. Not available

Source: Survey data








The second phase, aimed at providing information on the performance

of the establishments, the contribution of apprentices to production, and

the incomes of the proprietors, followed immediately after the first phase

ended. Stock forms were used to collect information about each establish-

ment's capital stock, inventories, and inputs. This was followed with flow

forms to provide data on each firm's output and sales; the hours worked by

proprietor, journeymen, and apprentices; and the value of inputs purchased.

To collect this information, each firm was visited by enumerators twice in

the month for six months to collect data on production activities covering

the entire two-week period preceding the visit.

Liedholm and Chuta [1976] show that small industries are characterized

by irregular, seasonal patterns of production. They show that peak pro-

duction activities in carpentry and tailoring occurs between the months

July and November. Auto repair, it seems, has no seasonality of production.

Based on these findings, data on the input-output relations of the estab-

lishments were collected from June through November.


2.5.1. Data Collection in Large-Scale Industries. In order to

obtain information as to whether apprenticeship-trained workers are hired in

other sectors of the economy besides small-scale industries, as well as

their earnings in these sectors, twelve large industries comprising seven

auto repair and five furniture firms located in Ibadan were included in the

survey. (No large-scale industries are located in the survey areas.) Dis-

cussion with the personnel managers provided the study with their personal

evaluation of apprenticeship training, as well as the list of apprenticeship-

trained workers in their firms. Permission was obtained to interview these

workers. With the use of questionnaires, 307 workers were interviewed to









provide information on earnings, work experience, previous employment and

earnings, and where they were trained. The data on earnings thus obtained

were used in estimating the rates-of-return to apprenticeship training in

wage employment.


2.5.2. Data Collection in Trade Schools. In order to facilitate a

comparative analysis of the apprenticeship system, two trade schools in the

area in which the small industry survey was carried out were included in the

study. The data collected dealt with training programs, institutional

arrangements, and training costs. The trade schools included were Oyo,

Trade Center and Ijebu-Ode Trade Center. Directives from the Oyo and Ogun

State governments were obtained after several visits and communication with

ministry officials. From both Ministries of Education responsible for the

centers and the principal of each school, information about the number of

students, salaries and number of personnel (both teaching and administra-

tive), other items of expenditure, and the training program was collected.

Information about buildings and equipment was obtained from the Technical

Education Division of the Ministry of Education. Also addresses of former

students were obtained from each center. Using these addresses, 500

questionnaires were mailed out to provide information on employment and

income after training. To obtain information on student costs, forms were

distributed to a random 20 percent of the students in the schools. Ques-

tions asked included amount of fees paid annually; and expenditures on uniform,

books, and personal upkeep.


2.6. The Shortcomings of and the Problems Associated with the Study

It seems appropriate at this juncture to spell out some of the

problems associated with the study and its shortcomings, especially as they








affect our findings. Data collection and interviewing began with 210

establishments (see table 2.1) in the first phase of the study. But

during the third month of the study when information on each firm's input

and output began to be collected, a number of proprietors refused to

cooperate, especially in the Ijebu-Ode area, and these firms were dropped

from the survey. However the information gathered during the first phase of

the study is utilized in the study. Even for those enterprises surveyed

for the entire duration of the study, incentives in one form or the other

had to be provided. By interviewing the apprentices separately and when

their masters were not there, it was discovered that there was no consensus

between the number of hours per day that the apprentice said he spends in

learning his trade and the number of hours his master said he trains him.

Hence in compiling information about the apprenticeship system, reliance

was placed more on the recorded observation of the researcher and the field

staff and also on the information provided by the apprentices, information

shown to be more reliable than that provided by the master. In other words,

it was found that questionnaires were not enough; one had to observe many

establishments for a number of weeks in order to get an accurate picture of

the mode and pattern of training as well as the firm's activities.









3. THE INSTITUTIONAL SETUP OF APPRENTICESHIP SYSTEM
IN WESTERN NIGERIA


In this section, the socio-economic characteristics of the

apprentices, the institution of apprenticeship training in the small-scale

industries, and the organization of training in government trade schools

will be examined.

Various characteristics tend to delineate the apprentices from the

rest of the population as well as from their masters. Important among

these are their age, level of education, and labor-market experience prior

to training. Tables 3.1 and 3.2 show a common trend among the apprentices,

with over 70 percent still in their teens and about 80 percent having com-

pleted at least primary school education, and with an average age of 14 years

and an average level of education of 5 years. Analysis of variance indica-

ted a statistically significant variation in age among the locations, with

apprentices in Oyo being older than those in Ijebu-Ode and Aiyepe. Compared

with their masters (the proprietors), apprentices appear to be better

educated in all the industries.

How much intergenerational mobility occurs in occupations or

industries in Western Nigeria? In a survey of craftsmen in Ibadan, Koll

[1969] observed that less than 10 percent of his respondents were engaged

in trades similar to those of their parents. As presented in table 3.3,

over 90 percent of apprentices in Oyo have parents whose main occupation is

farming. In Ijebu-Ode, however, only about 50 percent of the apprentices

have parents in agriculture. A substantial number of parents of apprentices

in Ijebu-Ode were engaged in trade or commerce as compared to those of Oyo

and Aiyepe apprentices. A number of explanations can be offered for these

observations. First, agriculture is the dominant employer of labor in the








TABLE 3.1

PERCENTAGE DISTRIBUTION OF APPRENTICES BY AGE


Age (years)


Industry


Auto Repair

Furniture Craft

Tailoring


Auto Repair

Furniture Craft

Tailoring


Tailoring


Auto Repair

Furniture Craft

Tailoring


* x: mean age;

Source: Survey


** n: number of apprentices

data


<20


>40


Location


Ijebu-Ode


Aiyepe


All
Locations


n**


31-40


7.14


20-30

%

13.51

16.67

20.00


64.71

35.72

27.78


15.63


29.63

25.00

20.00


%

86.49

83.33

80.00


35.29

57.14

72.22


81.25


70.37

71.88

78.33


14.9

16.8

16.4


19.5

16.3

17.5


18.4


17.2

16.6

17.4


3.12

---

3.12

1.67







TABLE 3.2

DISTRIBUTION OF APPRENTICES BY YEARS OF EDUCATION


Years of Formal Education


Location Industry None 1-6 7-9 x* n**


% % %
Ijebu-Ode Auto Repair 2.70 91.90 5.40 5.7 37

Furniture Craft 11.11 88.89 --- 5.3 18

Tailoring 10.00 90.00 -- 5.1 10


Oyo Auto Repair 29.41 70.59 -- 4.2 17

Furniture Craft 42.86 57.14 -- 3.0 14

Tailoring --- 100.00 --- 6.0 18


Aiyepe Tailoring 6.25 84.38 9.37 5.2 32


All Auto Repair 11.11 85.19 3.70 5.0 54
Locations
Furniture Craft 25.00 75.00 --- 4.2 32

Tailoring 5.00 90.00 5.00 5.4 60


* x: mean years of education; ** n:

Source: Survey data


number of apprentices








TABLE 3.3

DISTRIBUTION OF APPRENTICES ACCORDING TO


FATHER'S OCCUPATION


Father's Occupation


Oyo


No. %


Ijebu-Ode


No. %


Aiyepe


No. %


All Locations


No. %


Farming

Artisan

Clerical Worker

Trader

Other (Laborer,
Driver, etc.)


45 91.84

3 6.12


1 2.04


49 100.00


32 49.23

6 9.23

4 6.15

21 32.31

2 3.08



65 100.00


22 G8.75

4 12.50


1 3.12

5 15.63



32 100.00


99 07.81

13 8.90

4 2.74

23 15.75


4.80


146 100.00


Source: Survey data


~


_ --------


---








country; hence the predominant number of parents are from that sector.

Second, nearly all of the occupations of the parents of the apprentices are

low-income occupations. Such low-income parents are often unable to pay

the high cost of education for their children and hence send them to seek

their fortune in the apprenticeship system where costs of training are

lower.

In many countries in Africa, young men enter the labor force at a

relatively young age. In Nigeria no law exists against child labor and many

youths, upon completion of their primary education, move into the cities in

search of wage employment. But knowledge about the scarcity of jobs for

primary school leavers seems to have changed the orientation of parents as

well as their children. As shown in tables 3.4 and 3.5, nearly 90 per-

cent of the apprentices had no previous job experiences and about

60 percent never sought wage employment, but instead moved from formal

education to apprentice training. Of those who sought employment prior to

training, about 29 percent remained unemployed for 1 to 12 months.

The relative unattractiveness of farming as an occupation to youths is

shown in table 3.4 which indicates that only 3 percent of the apprentices

were ever engaged in farming.


3.1. The Apprenticeship System

In the absence of an organized labor market for apprentices,

recruitment of apprentices is undertaken through informal discussions

between the proprietor and his neighbors, customers, or relatives. Goodwill

on the part of the proprietor not only helps in attracting patrons and hence

business success, but parents or sponsors who have at one time or the other

interacted with the proprietor base their judgement of his ability to train

their children on such considerations. The most common practice by which








TABLE 3.4

JOB EXPERIENCE OF APPRENTICES PRIOR TO TRAINING


Oyo Ijebu-Ode Aiyepe All Locations


Job Experience No. % No. % No. % No. %


None 42 85.71 60 92.31 29 90.63 131 89.73


Domestic 2 4.08 --- -- -- 2 1.37
Servant

Farming 4 8.16 1 1.54 -- 5 3.42


Artisan 1 2.04 1 1.54 1 3.13 3 2.05
(Apprentice)

Others -- --- 3 4.62 2 6.25 5 3.42
(Road Hawkers)

49 99.99 65 100.01 32 100.01 146 99.99


Source: Survey data






TABLE 3.5

DISTRIBUTION OF APPRENTICES ACCORDING TO LENGTH OF UNEMPLOYMENT PRIOR TO TRAINING


Oyo Ijebu-Ode Aiyepe All Locations

Months of
Unemployment No. % No. % No. % No. %


None 33 67.35 39 60.00 13 40.63 85 58.22

1-12 Months 15 30.61 15 23.08 12 37.50 42 28.77

13-24 Months 1 2.04 8 12.31 4 12.50 13 8.90

25-36 Months -- --- 3 4.62 3 9.37 6 4.11

36 Months -- --- -- ---


49 100.00 65 100.01 32 100.00 146 100.00


Source: Survey data








apprentices are recruited is either by a parent approaching the proprietor

or the proprietor discussing his needs with neighbors, patrons, or

relatives.

Once recruited, an apprentice within the firm is not regarded as a

worker with definite hours of work. Rather, he is seen as part of the

proprietor's household and is expected to perform activities that are un-

related to his training. Callaway [1968], for example, documented

complaints by apprentices that they were often made to serve as house ser-

vants to their masters' wives. It was observed during the course of this

study that for many proprietors there is no separation between business and

family or social interests. Rather the two are seen to be closely related.

Proprietors may take time off from their duties to attend to family problems;

they may also send one of their apprentices to perform duties or services

in their households duties that are unrelated to the training program.

Apprentice training in most cases is viewed as not only training a child to

acquire some skills, but as part of the larger process of bringing him up.

One important facet of this is that the responsibility of bringing up the

child is transferred from the parents or sponsors to the master. This can-

not be otherwise because apprentices generally stay at their master's

workshop for up to twelve hours a day, irrespective of the business.

Entry into apprenticeship has no age limit nor restrictions based on

educational attainment. A youth just out of primary school may be appren-

ticed directly; an older farmer from a land-scarce community may migrate to

an urban area to learn a trade as can a married, unemployed woman. In gen-

eral, however, parents apprentice their children at a relatively young age,

often when they are between fourteen to twenty years of age. Given the

relatively young age of the apprentices, the decision to seek training will








have to be made either by their parents or relatives who can undertake to

finance the cost of training. Even when apprentices are old enough to

make decisions that will affect their lives, essentially the same parameters

would be considered as when parents make the decisions. Important among

these parameters is the rate of return to training in different industries.

While no data are available to parents on rates-of-return to alternative

skills, their perception of the labor market often depends on the demand

and supply of skilled labor in their location and on the relative success of

people who have learned similar skills in the area. Looking at table 3.6,

it is clear that for the majority of the apprentices, decisions regarding

where and to whom they were to be apprenticed were made by their parents.

Those who made the decision by themselves (mostly tailors in Aiyepe) were

mainly married women.

Once the decision is made on the trade and master, the next step

involves some form of agreement on the length of the training period, the

fees to be paid, and whether a youth will leave his parents to live with

his master. Sometimes a written document specifying the obligations of

both parties is prepared but in many cases the agreements are unwritten.

As shown in table 3.7, written agreements are more common in Oyo than

Ijebu-Ode. The highest proportion of written agreements is found among

apprentice tailors in Aiyepe and Ijebu-Ode. Examination of a number of

written agreements revealed the following essential elements:

1. the proprietor or master agrees to train the apprentice for a

specified length of time, usually between three to five years

2. the sponsor agrees to pay the apprenticeship fees in part either

during the training or at the end of the training period, and to perform

the "freedom ceremony"








TABLE 3.6

DISTRIBUTION OF APPRENTICES ACCORDING TO WHO MADE THE DECISION
FOR THEM TO BE APPRENTICED


Oyo Ijebu-Ode Aiyepe All Locations


Decision Made By No. % No. % No. % No. %


Self 9 18.37 5 7.69 18 56.25 32 21.92

Parents 29 59.18 57 87.69 11 34.38 97 66.44

Brother/Sister 2 4.08 1 1.54 1 3.13 4 2.74

Relation -- --- -- --- -- --- -- ---

Others 9 18.37 2 3.08 2 6.25 13 8.90
(Friends, etc.)
49 100.00 65 100.00 32 100.01 146 100.00


Source: Survey data









TABLE 3.7


DISTRIBUTION OF APPRENTICES BY TYPE OF CONTRACT
SIGNED WITH PROPRIETORS


Written Oral None
Location Industry % % % n*


Ijebu-Ode Auto Repair 18.92 32.43 48.65 37

Furniture Craft 27.78 72.22 --- 18

Tailoring 60.00 40.00 --- 10


Oyo Auto Repair 58.82 35.29 5.89 17

Furniture Craft 50.00 50.00 --- 14

Tailoring 44.44 33.33 22.23 18


Aiyepe Tailoring 68.18 29.55 2.27 44


All Auto Repair 31.48 33.33 35.19 54
Locations
Furniture Craft 37.50 62.50 -32

Tailoring 61.11 31.94 6.95 72


* n: number of apprentices

Source: Survey data









Signatories to the agreement usually include the master, the parents or

sponsors, and a witness. Agreements are not prepared in a court of law

or in front of a lawyer, as is normally the case in many European countries,

and disputes over the fulfillment of obligations are settled between the

parties concerned without recourse to legal or judicial authorities.

When asked what they would do should an apprentice violate the terms

of the agreement, nearly all the proprietors said they would report the

apprentice to his sponsor, and after repeated violations he would be dis-

missed. However, should an apprentice or his sponsor refuse to pay

apprentice fees, the master can deny performing the freedom ceremony, in

which case no certificate or evidence of training would be given to the

apprentice.


3.2. The Organization of Training

The organization of training in the Nigerian apprenticeship system can

be described as informal. The entire training is carried out on the job.

A hierarchy of authority is established in each firm. The master delegates

authority to the oldest apprentice or journeyman who then delegates part of

the authority to the next apprentice and so on down the line. The length

of training depends on the industry and on the age of the apprentice. Young

apprentices often spend more years in training than older ones. The average

length of training in Oyo, Ijebu-Ode, and Aiyepe ranges from three years in

tailoring to four years in auto repair and furniture craft.

Except among tailors who keep records of measurements, no related

training in the form of an organized lesson on the skill is provided. How









much learning takes place depends on the number and variety of orders the

firm receives in a given time. Proprietors with large orders engage their

apprentices in the production activities, and in order to speed up pro-

duction, will teach them faster than the proprietors with relatively fewer

orders. Apart from learning the skills of the trade, apprentices are often

sent on errands to buy raw materials and equipment and are thus able to

learn about purchasing and marketing in the process.


3.3. Apprentice Fees

One of the important components of the costs of apprentice training is

the amount each proprietor charges per apprentice. Variations in apprentice

fees between establishments in the same industry and between different

industries have been documented in Nigeria and Sierra Leone [Callaway,

1968; Liedholm and Chuta, 1976]. In a survey of small industries in

Nigeria, the I.L.O. team [I.L.O., 1971] reported that apprentice fees were

a source of capital and income for the proprietors in the area of the

survey.

In this section the relationships between apprentice fees and

allowances received by apprentices will be examined. Allowances, here,

refer to periodic payments in cash made to apprentices. Such allowances can

be given daily or weekly and are most often for mid-day meals and less often

for transportation. Do proprietors pay in the form of allowances more than

they receive as training fees? On the one hand, as more and more proprie-

tors demand more apprentices, the supply of trainee-workers to an

establishment could be increased only by offering higher inducements in the

form of allowances relative to apprentice fees. On the other hand, as the

supply of trainees to a firm increases, the apprentice fees decrease, all

other things being equal.








Before discussing the model, one aspect of the apprenticeship system

that more often than not governs the amount of fee paid will be examined.

In table 3.8, the distribution of apprentices according to the relationships

between themselves and their masters is presented. A youth may be appren-

ticed to his parents, his brother, or a relative. In this case he may not

have to pay apprentice fees which others are charged. In all the locations,

a large proportion of the apprentices (about 80 percent) are not related to

their masters. Rather they are the children of neighbors, patrons, or

friends of the proprietors. Blood relations predominate in Oyo as compared

with Ijebu-Ode and Aiyepe. Not withstanding this, however, over 95 percent

of the apprentices alleged that they have to pay apprentice fees in the Oyo

area. In Ijebu-Ode and Aiyepe only about 65 percent reported having to pay

apprentice fees.1

In table 3.9, the averaged apprentice fees and allowances paid for the

entire training period is presented by industry and by location. The

apprentice fee/allowance ratios are used here to measure the degree to

which proprietors offering training derive income gains from such activities.

In Ijebu-Ode apprentice fees on the average constituted 20 percent of the

allowances received during the training period. Furniture craft and auto

repair pay a higher allowance in order to induce apprentices in Ijebu-Ode.

In the Oyo area the average ratio was 1.42 with allowances lower in auto



It was observed that while some proprietors denied charging fees, their
apprentices said in confidence that they had to pay fees at the end of their
training. Moreover, disparities occurred in the amounts proprietors alleged
they paid as allowances and that the apprentices said they received. In these
these cases we used the information provided by the apprentices rather than
the proprietors.






TABLE 3.8

RELATIONSHIP BETWEEN MASTERS AND APPRENTICES


Not Related


Brother/Sister


Parents


Relatives
(Cousin, etc.)

Others
(Friends, etc.)


Oyo

No. of
Appren. %


37 75.52


6 12.24


Ijebu-Ode

No. of
Appren. %


56 86.15


8 12.31


12.24


49 100.00


1.54


65 100.00


Aiyepe

No. of
Appren. %


23 71.88


5 15.63





3 9.38


1 3.11



32 100.00


All Locations

No. of
Appren. %


116 79.45


19 13.01





10 6.85


1 0.69



146 100.00


Source: Survey data


----








TABLE 3.9

AVERAGE APPRENTICESHIP FEES AND ALLOWANCES (IN NAIRA) BY INDUSTRY AND LOCATION


Oyo Ijebu-Ode Aiyepe All Locations

A B A/B A B A/B A B A/B A B A/B
App. Allow. App Allow. App Allow. App Allow.
Fees Fees Fees Fees
Industry (N) (N) (N) (N) (N) (N) (N) (N)


Tailoring 39.93 38.40 1.04 22.30 63.00 0.34 14.27 25.30 0.56 25.50 42.23 0.60

Furniture 21.66 19.20 1.13 9.00 92.00 0.10 -- --- 15.53 55.60 0.28
Craft

Auto 39.41 13.45 2.93 17.25 94.53 0.18 -- --- 28.33 53.98 0.53
Repair

Mean for 33.67 23.68 1.42 16.18 83.18 0.20 14.27 25.30 0.56 23.05 50.60 0.46
all
Industries
NI.00 = $1.65

Source: Survey data









repair than in other industries. The sharp difference between Oyo and other

towns reflects the different labor-market situations in these areas. In Oyo,

for example, there exists a pool of unemployed school leavers seeking

either clerical jobs or looking for opportunities :o acqu re some marketable

skills. Moreover there is generally a dearth of proprietors in these indus-

tries in the Oyo area when compared to other locations. In these situations,

the scramble for the little available apprenticeship employment might have

led proprietors (1) to taking more apprentices than they might otherwise have

been able to train effectively, (2) to raising apprentice fees, and (3) to

pay less in the form of allowances to their apprentices. While it is true

that proprietors by engaging the apprentices in on-going production activi-

ties would derive an increase in earnings (which would increase progressively

as the apprentice's skill improves), our estimates of transfer payment

(allowances less apprentice fees) indicate that in two of the three towns

there is a positive net gain for the apprentices rather than the

proprietors.


3.4. Training Programs in Trade Centers

Before concluding this survey of apprenticeship training in the

small-scale industries, training in government trade schools, an alternative

institution established and run by the governments of Western Nigeria, will

be examined.

Unlike apprenticeship training which has a long history in Western

Nigeria, formal training of craftsmen came into being in the late fifties with

the establishment of the Ijebu-Ode Trade Center in 1959. The main objec-

tive of the trade centers was to provide

facilities for trade training for male and female students, with
the right aptitude for technical education which will qualify









them for direct employment in industry at craftsman's level,
or enable them to establish small-scale businesses of their
own in due course [Ministry of Education, 1972].

Between 1959 and 1963, five trade centers, including a women's center,

were established in different locations in Western Nigeria, each center

offering specialized courses in many trades (see table 3.10). Between

1962 and 1971 enrollment in the centers had increased from 854 to 1,853.

Admission into the centers requires that prospective students be between

fifteen and eighteen years of age and that they have a Secondary Modern

School certificate, that is, that they have spent nine years in formal ed-

ucational institutions. A common entrance examination is offered which

determines who is to be admitted.

Training lasts for three years and a fee of N72 (1 N [Naira] = $1.65)

is paid annually. Students are also required to buy books and work

clothes, but the fees paid cover accommodation, feeding, and instruction.

In light of the costs of running the institutions, the amount of money paid

by the students represents an insignificant portion. Thus, like all forms

of formal educational institutions in the country, the trade centers are

heavily subsidized.

Training is organized along three lines, theory and language, craft

practice, and "vacation employment" to provide real world experience for

trainees. The theory curriculum includes General and Related Science,

English Language, General and Practical Mathematics, Technical Drawing, and

General Factory Regulations. These subjects as well as craft practice are

taught at different levels in each of the three years on the following

basis: first year 15 hours class work and 20 hours of practical per

week; second year 10 hours of class work and 25 hours of practical per

week; and third year 10 hours of class work and 25 hours of practical








TABLE 3.10

TRADE CENTERS IN WESTERN NIGERIA: STUDENT POPULATION BY COURSE
SEPTEMBER 1974


Student Population
Ijebu-Ode Trade Center Courses
Furniture Craft 114
Brick Work 120
Painting/Decorating 97
Carpentry/Joinery 60
Plumbing 93
Screen Posters/Signwriting 17
501

Oshogbo Trade Center Courses
Fitter Machinist 166
Instrument Mechanic 102
Refrigeration and Air Conditioning 136
Radio/Television 156
560

Oyo Trade Center Courses
Agricultural Mechanic 81
General Welding 78
Auto Mechanic 93
Vehicle Body Building 42
Spray Painting 21
Sheet Metal 23
338

Owo Trade Center Courses
Electrical Installation 150
Auto Electrician 81
Auto Mechanic 64
295

TOTAL 1,694




Source: Western Nigeria Ministry of Education, Technical Education Section,
Ibadan





30


per week, excluding about three months of vacation. Vacation employment

is provided by attaching trainees who have completed two years to indus-

tries or to government establishments.

At the end of the training the centers conduct internal examinations

for the award of the Federal Craft certificates. Students are also

encouraged to take external examinations such as the City and Guilds of

London Institute examinations for Ordinary Craft certificates.









4. COSTS AND RETURNS TO APPRENTICESHIP TRAINING


Attempts to evaluate training programs are of recent origin with

relatively little work on training programs in Africa, and with many past

studies being approached from a macro viewpoint [Thias and Carnoy, 1972].

Analytically, evaluations of training programs take many forms, the most

important of which are (1) descriptive evaluation [CIRF, 1966] and

(2) comparison of one form of training with another based on human capital

theory in which benefit-cost or the internal rates-of-return are estimated

[Somers and Wood, 1969].

Benefit-cost and internal rate-of-return analyses involve the

application of investment theory to training programs and are meant to pro-

vide information about the yields to investment in education. The benefits

of a program come into existence over a period of time so that there is a

distinct profile of benefits and costs corresponding to each program. Among

the questions which an analyst faces is: Given sufficient funds, which

project should be undertaken by the society? To provide an answer, the

employment of an investment criterion such as benefit-cost ratios or inter-

nal rate-of-return is required. Benefit-cost analysis (or the Net Present

Value Criterion) involves the use of a given interest rate to weigh the

streams of benefits and costs, or the excess of benefits over costs, and

reducing these to a single value at a point in time. The problem is which

interest rate should be used. In internal rate-of-return analyses, the

rate which equates the stream of net benefits to zero is endogenously

determined. This approach assumes that the return from one point in time

is reinvested the following years and so on until the end of the project's

life [Mishan, 1976].








The internal rate-of-return analysis will be used in this study to

evaluate the alternative training programs.in Western Nigeria. The cost

components will be considered first, followed by a discussion of the

benefits or returns. The computed internal rates-of-return from alternative

training schemes will then be presented and discussed.


4.1. Components of Costs of Apprentice Training

Apprenticeship training, as organized in Nigeria, requires that both

employers and trainees share the costs of training and while the skill is

specific [Becker, 1971], it still can be used elsewhere. In the apprentice-

ship system under consideration, wages are not paid directly to workers;

rather, employers' costs often include the provision of board, food, and

allowances to apprentices in addition to the costs of materials and time

used up during the training program. Apprentices often pay training or

apprentice fees and may provide for their own upkeep, and engage in the

firm's production activities.

In rate-of-return analysis, the two types of costs used are private

costs and social costs. In this study private costs are defined as the

out-of-pocket costs incurred by the trainees. Under apprenticeship train-

ing, private costs (Cpa) include the value of equipment, tools, and uniforms

purchased by the apprentice (E), the difference between transfer payments,

that is, the difference between apprentices' fees (F) and allowances

received during the training (A) plus foregone earnings during the training

period (0), i.e.,


(1) Cpa = E + (F A) + 0








A student trained in the trade schools, like his counterpart under

apprentice training, incurs costs which are identified as student costs,

that is, expenditure on books, uniforms and tools (E), foregone earnings (0),

and fees (F). Unlike apprentices, trainees in the trade schools are paid

no allowances, although some income often accrues to them during "vacation

employment". Specifically, the private cost (Cpt) of training in the

trade schools can be written as:


(2) Cpt = E + 0 + F

The social cost of training (Csa), that is, the real cost of training

under the apprenticeship system, is defined as the sum of the value of

tools and equipment purchased by the apprentice (E), the opportunity cost

of the proprietor's labor (V), plus the opportunity cost of the firm's

capital equipment (K) less the value of output produced by the

apprentice (Q), plus the earnings foregone by trainees (assumed to be equal

to the opportunity cost of labor)(0), that is,


(3) Csa = E + V + K Q + 0

The social cost of trade school training, Cst, is the sum of

teaching and administrative costs (T), operating costs (Z), capital

costs (K), and earnings foregone (0) by the trainees:


(4) Cst = T + Z + K + 0

In order to measure some of the components of the costs, a number of

approaches were adopted. The first involves estimates of the value of

marginal product (VMP) of proprietor's labor, apprentice's labor,








2
and capital. To estimate the opportunity cost of the proprietor's

labor and capital, the VMP was multiplied by the average number of hours

worked by the proprietor in the year; the VMP of capital services was

multiplied by the annual estimate of capital utilization in each industry

and location. The value of output produced by the apprentice (Q) was

obtained in the same way by multiplying the VMP of apprentice labor by

the average annual number of hours worked by the apprentice. The estimated

opportunity costs and output of proprietors and apprentices are presented

in table 4.1. The opportunity cost of the proprietor's time is highest

in the furniture industry, over $1,000 per annum; and lowest in tailoring.

The observed differences reflect both labor productivity and earnings in

each industry. The value of output produced by the apprentice is lowest

in tailoring and highest in furniture making. The value of capital

services used up in training is negligible in all the industries. To

estimate the foregone earnings of apprentices, the average earnings of

unskilled workers in the labor force were used where the level of education



To estimate the value of marginal products of the inputs (capital
and labor) used by the firms, the following procedure was adopted. Cap-
ital was defined in terms of its rental value [Mabawonku, 1977] and labor
input of the proprietors, journeymen, and apprentices expressed in man-
hours. Using ordinary least squares technique, the parameters of the
Cobb-Douglas function were specified as:
an Q = aanA + Bo0nV + B1InLp + B2znLa + B3anLj + e where
Q is defined as value added, A the shift factor, V capital services, Lp
proprietor's labor, La apprentices labor input, Lj journeymen's hours of
labor input and e the error term.

Estimates of the marginal product of these factors were obtained
from the Cobb-Douglas production function thus: MPi = i(APi) where Ji
is the estimated elasticity coefficient of input i, and APi the average
product or the output-input ratio for that particular input.







TABLE 4.1


VMP AND OPPORTUNITY COST OF INPUTS USED IN APPRENTICE TRAINING


Proprietors Apprentices Capital Services

Labor Opp. VMP Opp. VMP Capital Opp.
VMP Input Opp. Input OppInput
(in N) (Hrs) Cost (in N) (Hrs) Cost (in N) (in N) Cost


Oyo

Auto Repair 0.66 248.52 164.02 0.08 577.68 46.21 0.15 26.39 3.96
Tailoring 0.57 303.96 173.26 0.04 200.88 8.04 0.10 60.39 6.04
Furniture 0.66 2232.60 1473.52 0.09 1284.60 115.61 0.35 17.01 5.95

Ijebu-Ode

Auto Repair 0.38 604.56 229.70 0.03 1265.76 37.97 0.40 53.78 21.51
Tailoring 0.05 1082.16 54.11 0.04 254.28 10.17 0.18 42.82 7.51
Furniture 0.90 2109.00 1898.10 0.13 1479.96 192.39 0.16 29.55 4.73

Aiyepe

Auto Repair --- --- --- --- --- --- --- --- ---
Tailoring 0.05 1110.70 55.34 0.04 453.84 18.15 1.42 38.29 54.37
Furniture --- --- --- --- --- --- --- --- ---


Source: Computed from Survey data








was similar to the average level of education of the apprentices.

In tables 4.2A, 4.2B, and 4.2C, the costs of training in the

tailoring, furniture craft and auto repair industries are shown. In

tailoring, foregone earnings constituted about 80 percent of the social

cost of training. Both social and private costs are highest in furniture

craft, followed by auto repair and lowest in tailoring. In nearly all the

industries and locations, apprentice fees are paid mostly at the end of

the training period and constitute about 6 percent of private costs in

tailoring, and 4.5 percent in furniture craft and auto repair. Another

component of the training cost is the amount spent on equipment by the

apprentice. In tailoring such equipment includes a tape, scissors, and

sometimes a catalog. In auto repair and furniture craft the tools pur-

chased by the apprentices are limited to a few hand tools. In general,

apprentices most often depend on the masters for the supply of tools and raw

materials for training. Other cost components of apprentice training, not

included in the table, include costs of freedom ceremonies, gifts from

proprietors to apprentices, and the value of services rendered by the

apprentice in the proprietor's household.


4.2. Cost of Training in Trade Centers

Unlike the components of training costs in small industries, the

components of training costs in the trade schools are directly and easily

measurable. Data on student costs were collected by the use of question-

naires. A randomly selected sampling of currently enrolled students from

the first to the third year of training were interviewed. In addition,

addresses obtained from the centers were used to trace former trainees and

to collect information on training costs and earnings. Questions asked









TABLE 4.2 A


COST COMPONENTS TAILORING


Cost Components
(in N per annum)


Year 1


Ijebu-
Aiyepe Ode Oyo


Year 2


Ijebu-
Aiyepe Ode Oyo


Year 3


Ijebu-
Alyepe Ode Oyo


Year 4

Ije-
Aiy- bu-
epe Ode Oyo


Total Years 1-4
Cash Flow Items


Ijebu-
Aiyepe Ode Oyo


Apprentice
Fees


Equipment, etc.
bought by
apprentice

Allowances
Received


Output
Produced by
Apprentices

Value of
Proprietor's
Time

Value of
Capital
Services

Foregone
Earnings


3.04


7.50


18.50


55.34


54.37



360.00


--- 2.84


--- 6.00



10.17 8.04


54.11 17.26


7.71 60.40



360.00 360.00


1.08


7.80


18.15


55.34


54.37



360.00


14.27


-- 2.69



5.00 7.20 10.00


10.17 8.04 18.15


54.11 17.26 55.34


7.71 6.04 54.37



360.00 360.00 360.00


22.20 ---


16.00


10.17


54.11


7.71



360.00


6.50


10.80


8.04


17.26


6.04



360.00


39.93 14.27


-6.81



14.40 25.30


8.04 54.80


-- --. 17.26 166.02


6.04 163.11


- 360.00 1080.00


22.20 39.93


--- 9.34



21.00 38.40


30.51 32.16


162.33 69.04


23.13 78.52


1080.00 1440.00


Source: Survey Data


---







TABLE 4.2B

COST COMPONENTS Furniture Craft


Total Year 1-4
Year 1 Year 2 Year 3 Year 4 Cash Flow Items

Cost Components Ijebu- Ijebu- Ijebu- Ijebu- Ijebu-
(in N per annum) Ode Oyo Ode Oyo Ode Oyo Ode Oyo Ode Oyo



Apprentice 10.00 -- -- --- 21.66 10.00 --- 20.00 21.66
Fees

Equipment, etc. --- --- 1.60 --- 4.00 6.00 10.20 --- 15.80 6.00
bought by
apprentice

Allowances --- 1.80 30.00 1.50 30.00 1.50 32.00 --- 92.00 4.80
Received

Output 192.39 115.61 192.39 115.61 192.39 115.61 192.39 --- 769.56 346.83
Produced by
Apprentice

Value of 1898.10 1473.53 1898.10 1473.52 1898.10 1473.53 1898.10 -- 7592.40 4420.57
Proprietor's
Time

Value of 4.73 5.95 4.73 5.95 4.73 5.95 4.73 --- 18.92 17.85
Capital
Services

Foregone 360.00 360.00 360.00 360.00 360.00 360.00 360.00 --- 1440.00 1080.00
Earnings


Source: Survey Data







TABLE

COST COMPONENTS


4.2 C

- AUTO REPAIR


Total Years 1-4
Year 1 Year 2 Year 3 Year 4 Cash Flow Items

Cost Components Ijebu- Ijebu- Ijebu- Ijebu- Ijebu-
(in N per annum) Ode Oyo Ode Oyo Ode Oyo Ode Oyo Ode Oyo



Apprentice --- --- 17.25 39.41 17.25 39.41
Fees

Equipment, etc. 2.00 -- 5.88 --- 8.00 -- 12.00 -- 27.88
bought by
Apprentice
Allowances 8.23 --- 24.00 3.25 27.33 3.50 43.20 4.20 102.76 10.95
Received

Output 37.97 46.21 37.97 46.21 37.97 46.21 37.97 46.21 151.88 184.84
Produced by
Apprentice
Value of 229.73 164.02 229.73 164.02 229.73 164.02 229.73 164.02 918.92 656.08
Proprietor's
Time

Value of 21.51 3.96 21.51 3.96 21.51 3.06 21.51 3.96 86.04 14.94
Capital
Services

Foregone 360.00 360.00 360.00 360.00 360.00 360.00 360.00 360.00 1440.00 1440.00
Earnings


Source: Survey data









dealt with fees, uniforms, books, and equipment bought by the trainees.

Data on personnel costs (teaching and administrative), operating, and

equipment costs were obtained from both the schools and the technical edu-

cation divisions of Oyo and Ogun States' Ministries of Education.

Estimates of the values of building and land were derived from data on the

proposed new trade schools. To obtain the annual rental value of buildings

and equipment, a discount rate of 20 percent was used. Foregone earnings

(see table 4.3 ) were obtained in the same way as the apprenticeship cost

by using the earnings of members of the labor force with similar education

to that of the trainees. Comparing the two trade centers (Ijebu-Ode

and Oyo), personnel and operating costs per pupil were lower in Ijebu-Ode

than in Oyo.

Value of capital services was assumed to be the same in the two

centers. Estimates of student costs show that trainees in Ijebu-Ode spend

more per year than those in the Oyo trade schools.

Compared with costs in apprentice training, the private cost of

training in the trade centers is over twice the annual private costs in

apprentice training; student fees in the trade centers are about twice the

highest apprentices fees, while foregone earnings of trade school trainees

is about twice as high as that of apprentices, a result of difference in

levels of education and in wages. Notwithstanding this however, training

in trade schools is heavily subsidized by the state governments with the

government being responsible for the running and upkeep of the institutions.

While the government is responsible for as much as 95 percent of the cost

in the trade centers, no government subsidy is received by the proprietors

or trainees in small-scale industries. Rather, the proprietors generally







TABLE 4.3.

COST COMPONENTS TRADE CENTERS


Year 1 Year 2 Year 3

Cost Components
(in N per annum) Ijebu-Ode Oyo Ijebu-Ode Oyo Ijebu-Ode Oyo


Teaching and 363.00 460.00 363.00 460.00 363.00 460.00
Administrative

Operating 126.00 291.00 140.00 320.00 145.00 300.00


Capital 1121.47 1121.47 200.10 200.10 90.75 90.75
(Services)

Student Costs 166.65 141.75 132.45 120.00 116.30 114.32
(fees, etc.)

Foregone 804.00 804.00 834.00 834.00 864.00 864.00
Earnings


Source: Computed from Survey data









tend to subsidize the training of their apprentices at least as far as cash

transfers between the proprietors and apprentices are concerned.


4.3. Estimates of Benefits

The benefit (monetary) from training is the increase in trainee

earnings occurring after the training and as a result of it. To estimate

the benefits, it was assumed that all trainees would find employment either

in small-scale industries as self-employed artisan workers or as wage

workers3 in either the large industries or in government establishments.

To estimate returns (earnings) to labor in self-employment, estimates of

the opportunity costs of the firm's capital and labor inputs (other than

the labor input of the proprietor), all of which were derived in table 4.1,

were subtracted from the firm's value added.4

The computed returns to self-employed proprietors are shown in

table 4.4. In all the industries, returns to proprietor increase with exper-

ience over time and then decline. From these data, earnings profiles,

relating experience and income for self-employed proprietors by industry

and location, were then constructed (see Mabawonkwu [1977], pp. 112-120).

To obtain the differential effects of additional training on earnings,




The wage estimates for those employed in large establishments were
obtained from the results of the interviews with the 500 trade school and
apprentice-trained employees who were wage employed. To obtain the
differential effects of additional training, these wage estimates were
reduced by the comparable unskilled wage rates.

- Specifically, the average returns to proprietor's labor is:
Qijk = Qijk Vijk BjkLaijk BjkLik and where Qijk is the returns to
proprietor in firm i, industry j and location k; Qijk is the firm's value
added, Vijk the rental value of capital services, Laijk apprentices' hours
of labor input, Lijk journeymen's hours of labor input, and B'sjk the
estimated MVP from the regression equation.








TABLE 4.4

DISTRIBUTION OF ANNUAL RETURNS (N) TO PROPRIETORS BY YEARS OF EXPERIENCE


Ijebu-Ode Oyo Aiyepe All Locations
Years of Auto Auto Auto
Experience Furniture Repair Tailoring Furniture Repair Tailoring Tailoring Furniture Repair Tailoring


1-5 N607.44 N380.22 N319.30 M829.10 N 358.40 N243.44 N229.98 N 757.54 N328.86 N270.30
(8) (5) (13) (8) (14) (17) (15) (16) (19) (45)
6-10 807.64 399.32 355.08 564.78 336.38 257.76 359.24 813.22 331.24 339.80
(7) (5) (7) (4) (7) (8) (6) (11) (12) (20)
11-15 1220.04 243.88 307.76 325.43 361.02 278.26 104.48 997.86 296.12 166.48
(4) (1) (1) (3) (3) (1) (5) (7) (4) (7)
16-20 462.88 497.72 494.66 1468.96 321.64 196.00 167.62 1212.80 348.48 300.14
(1) (3) (2) (2) (5) (3) (1) (3) (8) (6)
21-25 1062.88 478.00 292.66 1344.60 342.48 184.28 375.88 1242.42 300.48 328.90
(1) (1) (2) (1) (1) (1) (3) (2) (1) (6)
26-30 414.74 478.50 319.28 --- --- --- --- 332.02 461.70 175.20
(2) (3) (3) (2) (3) (3)


N 762.44 N409.94 N 344.79 N 906.39 N 343.98 N 231.95 N 247.44 N892.64 N344.48 N 263.47

Figures in parentheses are numbers of observations
Source: Computed from Survey data










however, the estimated earnings of proprietors had to be reduced by the

earnings that they might have obtained as unskilled workers in the economy.

To do this, the average earnings of unskilled workers with the same educa-

tional level as that of the trainees were subtracted from the estimated

proprietor's earnings (Mabawonkwu [1977]).


4.4. Estimates of Internal Rates-of-Returns

The estimates of the internal rates are presented in tables 4.5 and

4.6, and are based on the computations of the costs and benefits described

above. In presenting the calculations, an attempt is made to compare the

two alternative training programs with respect to training in only furni-

ture craft and auto repair since trade schools do not offer training in

tailoring. An attempt is also made to consider alternative employment

types, self-employment versus wage employment. Comparison between apprentice-

ship and trade school is, however, limited to wage employment because very

few of trade school-trained workers are self-employed.5

4.5. Rate-of-Return in Wage Employment

The earnings in wage employment in Nigeria, unlike earnings in

self-employment, do not often reflect demand and supply factors.6 Private

industries, in response to government policies, pay administered wages






50f the 500 questionnaires mailed to graduates of trade schools, for
example, not a single respondent was self-employed.

6Attempts to adjust the earnings stream for socio-economic factors
such as education and experience provided statistically insignificant
coefficients.









TABLE 4.5

PRIVATE AND SOCIAL INTERNAL RATES-OF-RETURN IN WAGE EMPLOYMENT


Apprentice Training

Private Social
Internal Internal
Rate of Rate of
Return % Return %


Auto 59.41 23.63
Repair

Furniture 62.22 32.19
Craft


Source: Computed from Survey data


Trade Center Training

Private Social
Internal Internal
Rate of Rate of
Return % Return %


68.03 23.33


76.79 24.00


-----









TABLE 4.6

PRIVATE AND SOCIAL INTERNAL RATES-OF-RETURN FOR SELF-EMPLOYMENT
FOR APPRENTICE TRAINING, INDUSTRY, AND LOCATION



Apprentice Training

Private Social
Internal Internal
Location Industry Rate-of-Return Rate-of-Return


Ijebu-Ode Tailoring 2.00 0.09

Furniture Craft 31.11 18.95

Auto Repair 14.32 14.11


Oyo Tailoring 7.05 0.13

Furniture Craft 24.25 12.93

Auto Repair 9.39 4.22


Aiyepe Tailoring 4.01 0.12


All Tailoring 5.53 0.24
Locations
Furniture Craft 29.94 16.89

Auto Repair 11.94 9.23


Source: Computed from Survey data











which are above what is necessary to induce a worker to forego self-

employment for wage employment. Equally important, however, is the fact that

many large-scale industries enjoy economies of scale and are able to declare

high after-tax profits despite the high wage rates. Translated into

yields from training, these high wages show up as high internal rates-of-

return for both types of training programs (see table 4.5.). Private

rates-of-return were higher for trade center trainees than for apprentices

in both auto repair and furniture industries by about 15 and 23 percent,

respectively. The private rates-of-return for the two training programs

were higher in furniture craft than in auto repair. For example, while the

rate for apprenticeship training in auto repair (wage employment) was

59 percent, the rate for furniture craft was 62 percent a difference of

about 5 percent.

Social rates ranged from 23 percent in auto repair to 32 percent in

furniture craft industry. Between the two training programs the social

rates-of-return were higher for apprentice than for trade center training.

In the furniture industry, the social rate for apprentice training was

32 percent compared with 24 percent for trade center training. In general

the calculated internal rates-of-return (both social and private) in wage

employment reflect the fact that apprentice training compares favorably

with trade school programs, especially from the point of view of society's

valuation, despite the lack of attention or support from the government.

Under the assumption that both apprentice- and trade school-trained

workers received equal pay, the adjusted earnings of apprentice workers

was used to estimate another set of internal rates-of-return for








trade-school training. The private rates for employment in auto repair

and furniture industries (for trade school-trained workers) declined from

68 to 31 percent and from 76 to 49 percent, respectively. Social rates also

declined, being 13 percent for auto repair and 16 percent for the furniture

industry. Thus, under equal pay for similar skills, the rate-of-return

(both private and social) to apprenticeship training would be nearly twice

the rate to trade school training.

The private (unadjusted) rate-of-return obtained by Thias and Carnoy

[1972] for those who completed 12 to 13 years of formal education in

Kenya was 23.8 percent. For trade school trainees with nine years of

formal education and three years of skill-related training, the adjusted

private rates in Western Nigeria (in wage employment) averages about

72 percent. While earnings and cost may differ in the two countries, it

seems, however, that skill-related training may be a more profitable invest-

ment than formal education up to a certain level.


4.6. Rate-of-Return in Self-Employment

If self-employment is the ultimate form of employment for

apprentice-trained workers, then the rate-of-return to self-employment

must not only be high enough to attract new entrants, but higher than those

in alternative employment opportunities. Alternative employment opportuni-

ties are limited mostly to wage employment in the manufacturing industries

and the public service. Between 1964 and 1972, Berger estimated an average

rate of growth of output in Nigeria's manufacturing industries at 8.1 percent.

The number of manufacturing establishments grew at a rate of 12.1 percent;

employment also grew at an average of 12.6 percent while the number of

workers employed per establishment only increased between 1964 and 1972 by









0.4 percent [Berger, 1975]. In other words, while earnings in wage

employment might be sufficiently attractive to induce workers to seek wage

employment, vacancies as well as recruitment are limited. Administered

wages, and technologies that are capital intensive, both mitigate against

employment opportunities in wage employment.

The private rates-of-return to self-employed apprentices are below

those in wage employment (see table 4.6 ). The average (all locations)

private rates in (self-employment) furniture and auto repair industries

are 48 and 20 percent, respectively, of the private rates in wage employment

for apprentice-trained workers.

Among the self-employed workers, returns also vary according to the

skill and the location of business. Tailoring in all of the three

locations Ijebu-Ode, Oyo, and Aiyepe is characterized by very low

private rates-of-return and negative social rates. These findings, of

course, reflect the generally lower earnings in tailoring and the prolifer-

ation of workers in the industry within the last decade [Mabawonku, 1977].

Auto repair and furniture craft, two industries that have been found

[Mabawonku, 1977] to generate higher incomes, also showed higher rates in

both Ijebu-Ode and Aiyepe compared with those in tailoring. For the two

industries, both private and social rates to apprentices were higher among

workers in Ijebu-Ode than in Oyo. Private and social rates in the furniture

industry in Ijebu-Ode were about 29 percent greater than for those of

similar industry in Oyo, while the social and private rates in auto repair

were respectively 200 and 55 percent greater in Ijebu-Ode.

The highlights of the study so far are as follows:

1. for the two training programs, the private rates-of-return are

higher in wage employment compared to self-employment








2. in wage employment, apprenticeship training compares favorably

with trade school training

3. for all industries, rates-of-return are higher in areas of high

income compared to areas of low income or in urban areas compared to rural

areas as shown, for example, in comparing Ijebu-Ode and Aiyepe

4. private rates are low in tailoring in all locations, with social

rates being negative


4.7. Adjusted Social Rates-of-Return

The previous analyses, however, are based on rather conservative

estimates of some of the cost parameters; consequently, in this section,

adjusted social rates-of-return are presented that reflect alternative

specification of these parameters. In the first instance it is not unlikely

that the estimated valuation of the proprietor's time used in this study

could lead to a higher estimate of the cost of apprentice training. With the

assumption that a proprietor would spend his time equally in producing

commodities and offering training, the value of the opportunity cost of

the proprietor's time was reduced by 50 percent. This produced a nearly

45 percent downward adjustment to the cost of training.

The use of this new cost stream produced changes in the social

rates-of-return as shown in table 4.7. Differences between the social rates

presented in table 4.6 earlier and the adjusted social rates in table 4.7

were, on the average, 30 percent, 55 percent, and 20 percent in tailoring,

furniture craft, and auto repair, respectively. The negative social rates in

tailoring became positive values ranging from 1.24 percent for Ijebu-Ode to

3.96 percent in Oyo. In wage employment, the adjusted costs also produced

statistically significant improvements in the social rate-of-return to

apprenticeship training. Indeed for those in wage employment, the social








TABLE 4.7

ADJUSTED SOCIAL INTERNAL RATES-OF-RETURN


BY INDUSTRY


Apprentice Training
Social
Location Industry Rate-of-Return %


Self-Employment

Ijebu-Ode


Oyo


Aiyepe


All
Locations


Tailoring

Furniture Craft

Auto Repair


Tailoring

Furniture Craft

Auto Repair


Tailoring


Tailoring

Furniture Craft

Auto Repair


Auto Repair

Furniture Craft


Wage
Employment


Sources: Computed from Survey data


1.24

29.44

14.88


3.96

23.45

7.30


2.20


4.25

19.32

9.97


66.00

75.14








rate-of-return to apprenticeship training was approximately three times

the social return to trade center training.

Attempts to adjust the costs in the trade schools for possible over

and underestimation, did not produce any appreciable change in the esti-

mated rates. In addition, attempts were made to see whether changes would

occur in the estimated rates by increasing the working life and hence the

"cut-off" period from thirty-five to forty years. No changes were observed

for all the skills and training programs beyond some very small percentage

points.

In general, the rates-of-return to both training types were high,

especially in wage employment. But given the shortage of intermediate-

skilled workers, earnings and hence the private rates could have been

higher but for government wage policies which mitigate against the forces

of supply and demand.7 While the estimates provide a static picture of the

economy at a given point, it is not unlikely that, with a general upswing

in the economy, returns to education will be higher in the future.

















7Around August 1976, the federal government decreed a wage freeze for
the private sector, thus preventing firms from bidding competitively for
workers.









5. SUMMARY AND POLICY IMPLICATIONS


In previous sections, several empirical findings relating to

apprenticeship training as a subset of activities of small-scale industries

in Western Nigeria were presented. This section summarizes these findings

and examines their policy implications.

One of the primary objectives of the study was to evaluate the returns

to alternative forms of training entrepreneurs in Western Nigerian small

industries. To this end, 210 establishments distributed among 4 major

industries (tailoring, furniture, auto repair and blacksmithing) in 3

locations (Aiyepe, Ijebu-Ode, and Oyo) were surveyed from April to

November 1976. In addition, information about costs of training in the

trade schools was collected from the Oyo and Ijebu-Ode trade centers. Three

hundred and seven intermediate skilled workers distributed among twelve

large-scale industries in Ibadan, as well as their employers, were inter-

viewed to provide information on employment prospects of apprentice-trained

workers in sectors other than the small-scale industries.

Unlike formal recruitment procedures in the large-scale industries,

recruitment of apprentices in small-scale industries was often undertaken

through informal discussions between the proprietors and their neighbors,

customers, or relatives. Considerable differences were observed between

the socio-economic characteristics of the proprietors and their apprentices.

Blacksmiths, rather than recruiting outsiders as apprentices, had their

family members learning the skills. In other industries, the majority of

the apprentices were not related to their masters. As could be expected,

the proprietor/masters were generally older than their apprentices. The

average age of the apprentices was seventeen years. Though younger than the









proprietors, apprentices appeared to be better educated than their masters,

with an average level of formal education of five years. While there was

evidence of intergenerational mobility in occupations, with less than

10 percent of the apprentices having parents engaged in the small-scale

industries, there is an indication that many of the apprentices had

parents in low paying occupations (see table 3.3). Through discussions

with the apprentices, it was gathered that many could have chosen to go

into formal training in high schools or government institutions had their

parents had the money.

Low income and the knowledge that jobs were scarce for primary school

leavers drove many youths to seek apprenticeship training. Of the 247

apprentices interviewed, nearly 90 percent never even bothered to look for

wage employment but proceeded straight from elementary school into appren-

ticeship training. Those who sought wage employment spent an average of

fifteen months before they could get such jobs as that of domestic servant.

Due to the relatively young age of the apprentices, the decision to

seek training in the small-scale industries was made by their parents or

relatives. The contracting of apprenticeship training generally involves the

parents approaching a master craftsman. Terms of the contract involve

determining the length of training, the apprenticeship fees, and whether

the youth would be living with his master or coming from his home. Appren-

ticeship contracts could be either written or verbal. About 45 percent of

the apprentices signed written agreements with their masters, while 43 per-

cent had verbal agreements and about 13 percent had yet to enter into one

form of agreement or the other. Unlike the common practice of European

apprenticeship, written agreements in Western Nigeria small-scale industries

generally are not notarized nor are they enforceable in a law court.









The organization of training can be described as informal. The

training period, averaging three and a half years, involves serving under

a master at the master's place of employment. No theoretical training of

any form is provided; training is done on the job, the amount of work done

being dependent on the demand for the product of the firm and the master's

reputation as a craftsman. Among the establishments whose services are

in constant demand, the apprentices were often exposed to many challenges

and training opportunities unlike those apprenticed to masters who received

fewer orders.

Training in the trade centers a substitute institution for

apprenticeship is organized along the pattern of formal education insti-

tutions with regular class schedules, regulations and examinations. Both

practical and theoretical training are provided by qualified instructors

for a period of three years. Unlike their apprenticed counterpart, however,

trainees in the trade schools are rarely exposed to the challenges of modern

technology. This has led many employers of skilled labor to complain that

training in trade centers is outdated.

The social costs of training apprentices are comprised of direct

trainee costs, proprietors' costs and foregone earnings. While apprentices

paid training fees ranging from N15 in the furniture industry to N 28 in

auto repair for the entire period of training, they received allowances

averaging N55 in furniture craft, N42 in tailoring, and about N54 in

auto repair.

Empirical evidence of the ratio of apprenticeship fees to allowances

received indicated that generally proprietors in the small-scale industries

were subsidizing the training of their apprentices, even when allowances

were adjusted for the contribution of apprentices to the firm's earnings.









The part of the cost of training borne by the proprietors includes the

opportunity cost of their time, the equipment used during the training,

and the subsidy. The estimated proprietor costs ranged from 5 percent per

annum in tailoring to 89 percent in the furniture industry. On the other

hand, the proportion of the cost borne by the apprentice (that is, the

ratio of fees, equipment purchased by the apprentice, foregone earnings, and

the difference between the output produced and allowances received) was esti-

mated at about 95 percent in tailoring to less than 12 percent in the

furniture industry. In locations where there is a scarcity of apprentice-

able youths (e.g., Ijebu-Ode) inducements in the form of allowances were

generally higher than in areas where there is a considerable interest in

apprenticeship training (e.g., Oyo). In the trade schools, student costs,

consisting of fees, uniforms, books and foregone earnings, constituted about

7 percent of the estimated total cost of training the rest being borne by

the government. Observations during the course of this study showed some

evidence of an underutilization of capacity in the trade schools both in

equipment and personnel. For example, it was observed at the Ijebu-Ode

Trade Center that some equipment had been lying idle for years to the extent

that the storekeeper had no record as to when and for what purpose the equip-

ment was purchased. The skills of the students, especially those in their

final year of training, are not utilized either in producing marketable

output or services, or in instructing their juniors as is generally done in

apprenticeship training.

The estimated rates-of-returns showed that the private as well as

social rates-of-return were high in wage employment for the two types of

training programs. However, private rates-of-return were higher for trade

school trainees compared with apprentice-trained workers a reflection of









government wage policies and the subsidies to trade schools. Social

rates-of-return for apprentice-trained wage workers, on the other hand,

were higher than the social rates-of-return for wage workers trained in

trade schools.

The private, as well as social, rates-of-return in self-employment

varied with industry and location. Private and social rates were highest

in the furniture industry in the two locations, and averaged about 30 per-

cent (private) and 17 percent (social). The lowest rates were in tailoring,

the private returns being 2 percent, 7 percent, and 4 percent in Ijebu-Ode,

Oyo, and Aiyepe, respectively. For all the locations, social rates-of-return

in tailoring were negative. For all the industries, the private rates were

higher than the social rates, an indication of the extent of subsidy being

provided by the proprietors for their apprentices.


5.1. Implications for Apprenticeship Training

While apprentice training can be regarded as a by-product of the

activities in small-scale industries, it is the main avenue by which entre-

preneurs in small-scale industries are recruited. The findings in the study

show that the system also provides other sectors of the economy with the

scarce skilled workers it needs. In as much as the system can perform these

functions, there is a need to incorporate the training under the apprentice-

ship system into the manpower policies of the country. The type of training

provided by the system is devoid of any theoretical exercise; the training

which an apprentice receives depends on the skills which the master himself

possesses and the demand for these skills. Thus strategies which aim to

upgrade the performance of the proprietors in the small-scale industries will

also be beneficial to their apprentices. As an educational process, such









strategies as technical assistance and provision of extension services for

small industries should not be pursued by the Ministry of Industries alone,

but must also involve the National Manpower Board. A joint approach by

these two bodies will lead to more effective retraining of proprietors and

hence their apprentices. Unfortunately, no study exists in Nigeria as to

the most effective method of retraining proprietors in small industries.

It is most important, therefore, that the personnel from the National Man-

power Board who are experienced in planning training programs and those

from the Ministry of Industries who are directly concerned with the prob-

lems in the small-scale industries work together to provide an effective

retraining program.

Presently, proprietors in auto repair and furniture craft recruit

apprentices by offering inducements in the form of allowances and lower

apprentice fees. In the trade schools, the government provides the sub-

sidy. An important policy question, therefore, deals with whether such a

subsidy provided by the government is necessary to induce trainees and

whether such subsidies should be extended to the apprenticeship system.

In the first instance, every level of formal education, from elementary

school to the university, is being subsidized by the government. Informal

training, such as in the apprenticeship system, has up to the moment been

operated without the benefit of government subsidies either to the trainees

or to the firms which offer training. But empirical evidence from this

study has shown that apprenticeship training provides workers both for

small-scale and large-scale industries. Moreover, proprietors who provide

the training of apprentices, rather than appropriating their total invest-

ment in offering training, often provide subsidies and hence suffer a loss








of earnings. Thus, as low as income in the small-scale industries is,

the proprietors appear to be transferring income to other sectors of

the economy. A policy that aims at redistributing income either through

grants or changes in fiscal policies that would favor the small-scale

industries is advocated.


5.2. Implications for Trade Centers

According to the edict establishing the institution of trade centers

in Western Nigeria, one of the goals envisaged was that trainees from the

trade centers, on completing their training, would establish their own bus-

inesses. Evidence from this study shows that a substantial majority of

trade-center trainees, rather than establishing their own businesses, are

employed in either large-scale industries or public institutions as wage

earners. This, of course, appears to be a reflection of the acute shortage

of intermediate-skilled workers in the economy and of government wage poli-

cies which make returns in wage employment higher than in self-employment

and thus more attractive to the trainees than the uncertainties of self-

employment. Equally important, however, is the evidence gathered in the

course of this study that the type and content of training provided does

not equip the trainees with the type of knowledge needed to succeed in

self-employment. The current curriculum in the trade schools lacks such

essential courses as economics, accounting, and marketing. Nor do the

trainees have out-of-school practical training. If the goal of self-

employment is to be realized, it will be necessary to reorganize the

present pattern and form of training. It may also be necessary to provide

loans to the graduating trainees without the stringent requirements of

collaterals or conditions which the students cannot meet or fulfill. This









applies to apprenticeship trainees as well. Indeed, it is recommended that

efforts be directed to encourage self-employment of trade-school trainees

since, if they were self-employed, they could also recruit apprentices and

hence generate positive secondary effects by teaching others.


5.3. Implications for Further Research

This study is an attempt to evaluate the effectiveness of

apprenticeship training in the small-scale industries. Admittedly, the

data on which the study was based are modest, being limited by the re-

sources available for the study. There is the need for a similar study to

be carried out in other states or areas of the country in order to have a

national perspective on the problem of apprenticeship training.

But apprenticeship training in the small-scale industries is but one

avenue by which entrepreneurs as well as skilled workers are produced.

Other forms of training include craft schools, industrial development cen-

ters, and training in the large-scale industries. As alternative forms of

training, these schemes require detailed evaluation so that policy-makers

may be aided in their choice of the most effective training program for

small industries.

Apart from the choice of the form of training, there is a need for

a detailed study of alternative institutional patterns for reaching the

thousands of small-scale industrial entrepreneurs scattered all over the

country. Among the important questions for which answers have to be

sought is whether the proprietors in the small-scale industries should be

organized at the local levels or on a regional basis for retraining. An

experimental study on a small scale is, therefore, recommended.









BIBLIOGRAPHY


Aluko, S.


A., A. 0. Oguntoye, and Y. A. 0. Afonja. 1972. Small-Scale
Industries: Western State of Nigeria. Ile-Ife, Nigeria:
University of Ife.


Archer, J. H. Educational Development in Nigeria, 1961-70: A Report on
the Planning and Cost of Educational Development on the Basis of
the Ashby Commission's Report. 1961. Lagos: Government Printer.

Barsby, Steve L. 1972. Cost Benefit Analysis and Manpower Programs.
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Journal of Political









AFRICAN RURAL EMPLOYMENT/ECONOMY PAPERS


*AREP No. 1 Derek Byerlee and Carl K. Eicher, "Rural Employment, Migration and Economic Develop-
ment: Theoretical Issues and Empirical Evidence from Africa," 1972.

AREP No. 2 Derek Byerlee, "Research on Migration in Africa: Past, Present and Future," 1972.

AREP No. 3 Dunstan S.C. Spencer, "Micro-Level Farm Management and Production Economics Research
Among Traditional African Farmers: Lessons from Sierra Leone," 1972.

AREP No. 4 D.W. Norman, "Economic Analysis of Agricultural Production and Labour Utilization
Among the Hausa in the North of Nigeria," 1973.

AREP No. 5 Carl Liedholm, "Research on Employment in the Rural Nonfarm Sector in Africa," 1973.

AREP No. 6 Gordon Gemmill and Carl K. Eicher, "A Framework for Research on the Economics of Farm
Mechanization in Developing Countries," 1973.

AREP No. 7 Francis Sulemanu Idachaba, "The Effects of Taxes and Subsidies on Land and Labour
Utilization in Nigerian Agriculture," 1973.

AREP No. 8 D.W. Norman, "Methodology and Problems of Farm Management Investigations: Experiences
from Northern Nigeria," 1973.

AREP No. 9 Derek Byerlee, "Indirect Employment and Income Distribution Effects of Agricultural
Development Strategies: A Simulation Approach Applied to Nigeria," 1973.

*AREP No. 10 Sunday M. Essang and Adewale F. Mabawonku, "Determinants and Impact of Rural-Urban
Migration: A Case Study of Selected Communities in Western Nigeria," 1974.

*AREP No. 11 Enyinna Chuta and Carl Liedholm, "The Role of Small-Scale Industry in Employment Genera-
tion and Rural Development: Initial Research Results from Sierra Leone," 1975.

AREP No. 12 Tesfai Tecle, "The Evolution of Alternative Rural Development Strategies in Ethiopia:
Implications for Employment and Income Distribution," 1975.

AREP No. 13 Derek Byerlee, Joseph L. Tommy and Habib Fatoo, "Rural-Urban Migration in Sierra
Leone: Determinants and Policy Implications," 1976.

AREP No. 14 Carl Liedholm and Enyinna Chuta, "The Economics of Rural and Urban Small-Scale.
Industries in Sierra Leone," 1976.

AREP No. 15 Dunstan S.C. Spencer, Ibi I. May-Parker and Frank S. Rose, "Employment, Efficiency
and Income in the Rice Processing Industry of Sierra Leone," 1976.

AREP No. 16 Robert P. King and Derek Byerlee, "Income Distribution, Consumption Patterns and
Consumption Linkages in Rural Sierra Leone," 1977.
AREP No. 17 Adewale F. Mabawonku, "An Economic Evaluation of Apprenticeship Training in
Western Nigerian Small-Scale Industry," 1979.












*Out of print.

Single copies of the papers may be obtained free from the African Rural Economy Program, Department of
Agricultural Economics, Michigan State University, East Lansing, Michigan 48824, U.S-A.






68

AFRICAN RURAL EMPLOYMENT/ECONOMY WORKING PAPERS


*WP No. 1 "African Rural Employment Study: Progress Report and Plan of Work, 1972-1976,"
May 1974.

*WP No. 2 Dean Linsenmeyer, "An Economic Analysis of Maize Production in the Kasai Oriental
Region of Zaire: A Research Proposal," May 1974.

*WP No. 3 Hartwig de Haen, Derek Byerlee and Dunstan S.C. Spencer, "Preliminary Formulations
of Policy Models of the Sierra Leone Economy Emphasizing the Rural Sector," November
1974.

*WP No. 4 Enyinna Chuta and Carl Liedholm, "A Progress Report on Research on Rural Small-Scale
Industry in Sierra Leone," November 1974.

*WP No. 5 "Plan of Work for the IDR/MSU Research Program in the Ada District of Ethiopia,"
November 1974.

*WP No. 6 William A. Ward, "Incorporating Employment into Agricultural Project Appraisal: A
Preliminary Report," February 1975.

t*WP No. 7 Eric F. Tollens, "Problems of Micro-Economic Data Collection on Farms in Northern
Zaire," June 1975.

*WP No. 8 "Annual Report for Period July 1, 1974 June 30, 1975--Rural Employment in Tropical
Africa: A Network Approach," 1975.

t*WP No. 9 Carl K. Eicher, Merritt W. Sargent, Edouard K. Tapsoba and David C. Wilcock, "An
Analysis of the Eastern ORD Rural Development Project in Upper Volta: Report of
the M.S.U. Mission," January 1976.

t*WP No. 10 Tom Zalla, "A Proposed Structure for the Medium-Term Credit Program in the Eastern ORD
of Upper Volta," February 1976.

*WP No. 11 Dunstan S.C. Spencer, "African Women in Agricultural Development: A Case Study in
Sierra Leone," April 1976.

*WP No. 12 Derek Byerlee, Joseph L. Tommy and Habib Fatoo, "Rural-Urban Migration in Sierra Leone:
Determinants and Policy Implications," June 1976.

*WP No. 13 Dunstan S.C. Spencer, Ibi May-Parker and Frank S. Rose, "Employment Efficiency and
Incomes in the Rice Processing Industry of Sierra Leone," June 1976.

*WP No. 14 Carl Liedholm and Enyinna Chuta, "An Economic Analysis of Small-Scale Industry in
Sierra Leone," June 1976.

*WP No. 15 Dunstan S.C. Spencer and Derek Byerlee, "Technical Change, Labor Use and Small Farmer
Development: Evidence from Sierra Leone," August 1976.

*WP No. 16 Mark D. Newman and David C. Wilcock, "Food Self-Sufficiency, Marketing and Reserves
in the Sahel: A Working Bibliography," September 1976.

t*WP No. 17 Gretchen Walsh, "Access to Sources of Information on Agricultural Development in the
Sahel," December 1976.

*WP No. 18 Dean A. Linsenmeyer, "Economic Analysis of Alternative Strategies for the Development
of Sierra Leone Marine Fisheries," December 1976.

*WP No. 19 Dunstan S.C. Spencer and Derek Byerlee, "Small Farms in West Africa: A Descriptive
Analysis of Employment, Incomes and Productivity in Sierra Leone," February 1977.

t WP No. 20 Derek Byerlee, Carl K. Eicher, Carl Liedholm and Dunstan S.C. Spencer, "Rural
Employment in Tropical Africa: Summary of Findings," February 1977.

*WP No. 21 Robert P. King, "An Analysis of Rural Consumption Patterns in Sierra Leone and Their
Employment and Growth Effects," March 1977.

t*WP No. 22 Tom Zalla, Ray B. Diamond and Mohinder S. Mudahar, "Economic and Technical Aspects
of Fertilizer Production and Use in West Africa," July 1977.







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