Tuesday, January 27, 2009

Training losing ground in the battle of the budgets

Financial hardships caused by the economic recession have led even more organizations to cut spending on employee training, according to two recent studies.

The average amount companies spend on training per employee fell 11% in the past year, according to a recently released research report by Bersin & Associates. Training expenditures per employee declined from $1,202 per trainee in 2007 to $1,075 per trainee in 2008.

Bersin’s data also showed that the U.S. corporate training market shrank by more than $2 billion, from $58.5 billion in 2007 to $56.2 billion in 2008, marking the greatest decline in more than a decade.

This latest report mirrors another study released in November, revealing that more than twice as many corporate and government training professionals expect training budget decreases rather than increases in 2009.

According to the study by training services firm Expertus, almost half (48%) of survey respondents expect smaller training budgets in 2009, up from 41% in 2008.

“When budgets became tight, organizations with a traditional training focus suffered most,” Bersin said in a statement. “Today’s business world demands a combination of formal and informal learning with an emphasis on collaboration, knowledge sharing, social networking, coaching, and mentoring.”

A well-trained employee is one of your company’s best assets and worthy of the financial investment. Resist the urge to take the “easy” way out by cutting development opportunities and find creative ways to stretch your training budget.

For more information on how to (and how not to) handle employee training in a recession, take a look at some of these related posts:

Cutting training, cutting safety: Is our economy causing more workplace injuries

Employee training and the budget battle

Training budgets, just another victim of the recession

‘Recession-proof’ employee training tips

5 tips for employee training on a tight budget

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