Apprentice scheme will cut unemployment - trades expert

With one in eight young New Zealanders not in employment, education or training, there's optimism the Government's dole-for-apprenticeship scheme will work.

The scheme - to be announced on Thursday - is expected to see employers get the equivalent of the Jobseeker Support Benefit if they take on an apprentice, according to what was outlined in a previous Cabinet paper.

Paul Hollings, head of trades at Manukau Institute of Technology, says it's likely most of those who'll take up the offer are in that one-in-eight.

"We expect a lot of these future apprentices are sitting at home on the couch at the moment," he told The AM Show on Thursday. "Far, far too many. They need an opportunity, and this is an opportunity."

Cabinet papers estimate the cost of the scheme will be between $51 million and $63 million a year - money that might perhaps be spent on paying Jobseeker Support Benefits instead - and up to 4000 a year will sign up.

Mr Hollings said it'll be money well-spent, as long as it's done with care.

"The trick the Government needs in doing this is to make sure that there's pastoral care. We don't want to set employers and these young people up to fail - there's going to have to be a little bit of extra care to get them off the couch and into work, and keep them in work."

And not all employers can be trusted.

"The Government will need to make sure the system of subsidies aren't exploited - because there will be employers out there, unfortunately, who may use it as an opportunity to get cheap labour."

With unemployment fairly low and construction and trades dominating Immigration's skill shortage lists, Mr Hollings says applicants are almost guaranteed work at the end of their apprenticeship.

"There's a significant number - huge. We can't keep up with it in terms of pre-apprenticeship graduates. They just get snapped up before they're finished their pre-apprenticeship programmes."

Last year Prime Minister Jacinda Ardern quelled rumours a future 'work for the dole' scheme would see people earn less than minimum wage.

"Where you replace real jobs - for instance forestry planting, which is a real job - with someone actually earning the dole, then you're replacing a real job for a lower wage," she said.

Pay for apprentices can be as little as $13.20 an hour, depending on their level of education.