Training Seen as Boost to Businesses’ Competitiveness

U.S. companies encouraged to expand into areas where worker training is available

By Pete Wolfinger Jan 7, 2013
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U.S. companies that expand operations into regions where skills training is a strategic, long-term and collaborative effort endorsed by educators, government agencies and the business community will have a distinct advantage over competitors, according to ManpowerGroup.

The economy ended 2012 with 155,000 more jobs in December and a 7.8 percent unemployment rate, according to the Jan. 5, 2013, report released by the U.S. Bureau of Labor Statistics. That was unchanged from November’s unemployment rate, which was revised up from 7.7 percent to 7.8 percent.

“One catalyst behind recent job growth in some sectors is that U.S. companies are advancing their high-skill training initiatives, a critical step to creating the right pool of job candidates,” said Jeffrey A. Joerres, ManpowerGroup Chairman and CEO in a Dec. 7, 2012, news release. “These initiatives are often found in U.S. regions which have developed advance training hubs that feed several growing industries. The most effective high-skill job training today is typically built and sustained by a collaborative public-private sector strategy.”

According to the American Society for Training and Development’s (ASTD’s) 2012 State of the Industry Report, U.S. organizations spent $156.2 billion on employee learning and development in 2011, demonstrating some organizations’ belief that a well-trained, highly skilled workforce is a competitive differentiator. Thus, some businesses understand the importance of making substantial investments in the development of their employees.

Still, 49 percent of U.S. employers struggle to fill mission-critical positions, according to ManpowerGroup’s 2012 Talent Shortage Survey results. Skilled trades, engineering and IT positions have ranked among the top 10 hardest jobs to fill for several years.

“Many jobs [that are] re-shored to the United States are high value-added [positions] that require extensive training,” said ManpowerGroup President Jonas Prising in a news release. “This important trend will continue to grow in regions that have taken proactive steps to align local educators’ programming with employers’ needs. Companies that can hire locally will hire locally.”

The amount employers will contribute toward employee training and development varies greatly, according to ASTD’s research findings. One of the most telling predictors of training budgets is company size, with smaller companies generally spending more per employee than larger companies.

Although $156.2 billion was spent on training in 2011, the per-employee spending in this area decreased 4 percent from 2010 to 2011; that is, $1,228 per employee was spent in 2010 compared with $1,182 per employee in 2011. Internal expenses ($87.5 billion) accounted for 56 percent of the total, while tuition reimbursement ($21.9 billion) accounted for 14 percent.

However, direct expenditures on learning as a percent of payroll increased from 2.7 percent in 2010 to 3.2 percent in 2011.

Other Findings

Technology-based delivery of instruction rose to 37.3 percent of total formal training hours in 2011, up from 29.1 percent in 2010. The majority of employee learning and development takes place in an asynchronous environment in which materials, lectures, tests and other training content can be accessed by the student at any time. Trainees do not have to be online at the same as, or face-to-face with their instructor to complete the training.

Examples of asynchronous learning resources include:

  • Virtual libraries and/or repositories of course content.
  • Discussion boards/forums.
  • Wikis and other collaborative documents or shared online learning spaces.
  • Other passive e-learning tools, such as pre-recorded videos or audio files.
  • Examples of synchronous learning elements include more active, participative tools, such as:
  • Video conferencing.
  • Voice communication (either using voice-over IP or a conference phone line).
  • Live chat communication.
  • Interactive live polls, Q&As, etc.

Overall, employees averaged 31 hours of training in 2011, focused on the following three areas:

  • Managerial and supervisory (12.6 percent) training.
  • Profession or industry-specific (11.6 percent) training.
  • Processes, procedures and business practices (11.6 percent).

Pete Wolfinger is a freelance writer based in Arlington, Va.

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