As UK training spending surges 11 percent, more organisations bring training in-house to address the needs of the business and learners
OAKLAND, California, Jan. 28, 2016 /PRNewswire/ -- Spending in the United Kingdom on learning and development (L&D) initiatives surged 11 percent between 2014 and 2015 to an average of £1,068 per learner as surveyed organisations invested more to help develop future leaders and close skills gaps, according to new research from Bersin by Deloitte, Deloitte Consulting LLP. Summarised in a WhatWorks® brief, the findings appear in the "UK Corporate Learning Factbook: Benchmarks, Trends and Analysis of the UK Training Market."
Despite increased spending on L&D, the research shows that the sharpest decline in L&D budget allocations since 2012 was for outsourced services. Budget allocations for external services dropped to just 14 percent in 2015 from 41 percent of L&D spending in 2009. The steep drop may indicate that L&D practitioners have grown increasingly confident bringing training initiatives in-house. Another potential indicator that UK organisations are regaining control of their L&D initiatives is that staff-to-employee ratios rose 50 percent from 10.1 to 15.1 staff per 1,000 employees from 2012 levels.
"These data indicate that the United Kingdom's economic recovery is manifesting itself through more confident spending across L&D practices," said Dani Johnson, vice president, learning and development research, Bersin by Deloitte, Deloitte Consulting LLP. "Increased staffing has enabled L&D groups to take on greater and more diverse training responsibilities so that they can grow the next generation of leaders and upskill their workforces to meet market demands."
Instructor-led training continues to be the primary L&D delivery method, accounting for 32 percent of training hours, according to the research. However, instructor-led training has declined 45 percentage points since 2009, when it accounted for 77 percent of training hours. Meanwhile, the largest increase in L&D budget allocations was for the development of e-learning content, which rose 12 percentage points to 19 percent.
"While online training now accounts for just over one-quarter of L&D delivery methods," said Johnson, "other modalities that foster an environment of informal, continuous learning – especially experiential, on-the-job training and collaboration and feedback – grow increasingly prevalent. It has become clear in recent years that L&D practitioners seek equilibrium in training as they try to reach employees in diverse and complementary ways."
Data for this study was collected from 220 UK organisations between January and August 2015. Findings of the new research, which as in past years includes essential training spending metrics, reflect changes made to this year's survey. Chiefly, the minimum number of employees for respondent consideration increased from 50 to 500 for small organisations since the survey was last conducted in 2011. Bersin by Deloitte made this adjustment to provide a more granular level of insight into market specifics.
Among the study's other key findings:
- Financial services/insurance tend to invest the most in training. Surveyed organisations in the financial services/insurance industry increased spending 17 percent in 2015 over 2014. The average financial services/insurance organisation spent £1,443 per employee in 2015, 35 percent higher than the UK average. The need to train employees on emerging regulatory measures, which were introduced after the economic downturn to foster greater economic stability, likely accounts for this increase.
- Training hours continue to climb. The number of training hours per employee rose from 14.5 in 2012 to 16.2 in 2015 – a 12 percent increase. By contrast, in response to the recession, many organisations had slashed training hours for employees by nearly 50 percent and reduced training budgets. Formal training – as seen in terms of learning hours per employee – is now returning to pre-recession levels.
- Many organisations are investing more to develop future leaders. In 2015, the largest portion of developmental spending went to management or supervisory training programmes. This likely signals that UK markets have stabilised following the economic downturn and organisations are now focused on growing future leaders as well as driving business outcomes. Although the abolition of the Default Retirement Age in 2011 has increased the number of older employees in the workplace, organisations are still working to strengthen their talent pipelines and ensure robust succession plans are in place.
- Organisations focus on learning leadership. Learning leadership, which includes the development and execution of learning strategy (e.g., managing budgets, allocating resources, developing the L&D department) occupied 12 percent of L&D practitioners' time in 2015. This was the No. 1 area in which surveyed organisations of all sizes spent their time.
- Mature organisations typically invest more in training. Organisations at the highest level of maturity invest nearly 20 percent more per employee than their less-mature counterparts. These more mature respondent organisations also are more focused on professional and industry-specific training to augment organisational capabilities and strengthen operations.
To learn more, register for the online webinar, "Light on the Horizon in the UK: Indicators of Learning & Development's Post-Recession Recovery," on Feb. 23, 10:30 a.m. ET/15:30 GMT, with senior research analysts Ben Carroll and Jen Krider, Bersin by Deloitte, Deloitte Consulting LLP.
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