Does more money help? The impact of the apprenticeship minimum wage on training offers and take-ups

In response to increasing difficulties faced by firms in filling training positions, Germany introduced a minimum apprenticeship wage (MAW) of 515€ in 2020. Theoretically, the MAW’s effect is ambiguous: higher costs may reduce firms’ incentives to offer training positions, while increased wages could make apprenticeships more attractive, potentially increasing applicant numbers. It remains unclear which effect predominates in terms of actual take-ups. This paper provides first empirical analyses of the MAW’s impact on offered apprenticeship positions and actual take-ups. Using a difference-in-differences design with firm-level panel data, we find negative effects on both offered and filled trainings. This finding is robust to sensitivity analyses, including placebo tests for diverging trends before treatment, effects on other employee groups, inclusion of controls covering COVID-19 affectedness, post-treatment selection and attrition. The results suggest that the negative impact on offers dominated possible gains and did not lead to more entrants into the training system.