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Employers committing to learning and development, but at lower cost, says CIPD


Employers are slashing their learning and development (L&D) budgets, with less than a tenth expecting an increasing in training spend over the next year, according to the CIPD.

More than two-fifths of organisations have decreased funding (43%) for L&D this year, with two-fifths (42%) anticipating a reduction and only one in 10 anticipating an increase in the next 12 months, according to the CIPD's Learning and Talent Development Survey of 600 organisations, due to be published this week. Over a half (54%) of organisations claim their economic circumstances have declined in the past 12 months, with a third overall moving to reduce the use of external L&D suppliers to in-house provision as a result.

Encouragingly, two-fifths of HR professionals surveyed report they have become more 'business-focused', due to the adverse economic circumstances. Although companies this year have increased their training offering to a median of five days per employee (equivalent to 2009 levels), compared to four days per employee in 2010, they have also increased their use of less costly development practices such as e-learning (54%), coaching by line managers (47%), in-house development programmes (45%) and internal knowledge-sharing events (37%).

Cuts to public sector funding are having a widespread impact on L&D. The public sector is three times as likely as the private sector to report that the funding of learning and talent development will decrease in the next 12 months (76% compared to 26%). This compares to two-fifths (19%) of public sector and over a half of private sector respondents expecting cuts last year. Public sector employers are also twice as likely as their private sector counterparts to report a reduction in formal education courses (49% to 24%) and instructor-led training delivered off the job (38% compared to 21%). They are also more likely to have reduced less expensive options, such as the use of in-house development programmes (25% compared to 8%), job rotation, secondments and shadowing (27% compared to 10%).

John McGurk, learning and talent adviser at the CIPD, said: "With the full impact of the spending cuts yet to be felt in the public sector, maintaining support for employee development by linking it to organisational change is essential if organisations are to steer through these uncertain and challenging times. "It is encouraging to see that during the tough times organisations have coped well with reduced budgets and shifted from external to in-house provision, as well as utilising less costly development practices. This has proved that the function is adept to bring in innovation, as well as cost control, when the going gets tough. We expect to see public sector learning and development teams rely on similar methods as the cuts start to bite, already indicated by our findings. "Although many firms are still struggling in the private sector and some are still reining in spending on training, the picture has picked up since last year. Not only have we seen L&D being prioritised more in the recent recession than in previous ones, we are also seeing a strong bounce-back from firms recognising that investing in skills is the best way of capitalising on recovery."

The full findings of the survey will be revealed at the CIPD's annual HRD Conference and Exhibition, at London Olympia, 6-7 April.