Magazine article Talent Development

ASTD's 2013 State of the Industry Report: Workplace Learning Remains a Key Organizational Investment

Magazine article Talent Development

ASTD's 2013 State of the Industry Report: Workplace Learning Remains a Key Organizational Investment

Article excerpt

In a continuously changing economic environment, organizations remain committed to organizational learning and development (L&D). In the 2013 State of the Industry Report sponsored by Skillsoft and Cara, 475 organizations representing a diverse sample of industries, sizes, and locations report on training metrics in their organizations.

ASTD estimates that in 2012 organizations spent approximately $164.2 billion on employee training. Of this total direct learning expenditure, 61 percent ($100.2 billion) was spent internally. The remainder was spent on external services, which accounted for 28 percent ($46 billion), and tuition reimbursement, which accounted for 14 percent ($18 billion).

Spending per employee remains stable

In 2012, the Bureau of Labor Statistics estimates that on average 181,000 jobs were added per month and the unemployment rate fell one percentage point. Organizations adapted to the changing workforce size and managed to keep the average direct learning expenditure per employee stable at $1,195 in 2012, which is $13 higher than the average in 2011.

Spending per employee is affected by several factors. One major factor is the size of the organization. Smaller organizations, particularly those with fewer than 500 employees (which account for 36 percent of responses in this study), typically spend more per employee than larger organizations. They rely more on external services and tuition reimbursement plans, and have a smaller L&D staff.

Due to smaller staff size, they typically spend more per employee because they are not able to distribute training--costs including development and implementation--among as many employees as a larger organization. In 2012, small organizations with fewer than 500 employees spent on average $1,800 per employee on direct expenditures, mid-size organizations with 500 to 9,999 employees on average spent $964, and large organizations with more than 10,000 employees spent an average of $700.

In line with spending per employee remaining constant, the number of training hours used by employees also remained stable in 2012 at 30.3, compared with 30.5 in 2011. During the past four years there has been little movement in the number of training hours used by employees.

It also is noteworthy that organizations are not just increasing the reuse of content to keep costs down. The reuse ratio in 2012 fell slightly from 52.8 to 47.5. The reuse ratio is the number of learning hours used compared with the number of learning hours available. The reuse ratio typically remains around 50, which is a healthy ratio. It shows that organizations are producing new content and it is being used.

Role of technology

The question that remains to be answered is how organizations are continuing to offer new training and maintain spending levels, yet the number of training hours used by employees has remained relatively flat during the past four years. There are a few reasons why this may be happening. One of which might be the increasing role of technology usage for training and the shift toward e-learning. Another might be increased usage of informal and social learning.

For the past three years, the percentage of training offered by organizations via traditional instructor-led classroom has been making a slow decline, accounting for 55 percent of training hours used in 2012--which is a six percentage point decline from 2010, when instructor-led classroom accounted for 61 percent of hours used. At the same time there has been an increase in the usage of technology-based methods, such as instructor-led online (accounting for 10 percent in 2012 compared with 8 percent in 2010), instructor-led remote, and mobile learning.

What all three of those methods have in common is that their usage by employees can be difficult to measure in time increments, and they often don't easily align with an organization's learning management system. …

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