Public Release:  Employers maintain training budgets despite recession, research shows

SAGE Publications

British employers have avoided slashing their budgets for training during the recession because they believe it is vital to their operations, a new study has found.

Researchers analysed figures from various surveys showing that spending in real terms on training fell by only 5% from 2007 to 2009, and has remained steady since. They also spoke to managers from 52 companies and found that almost all remained committed to keeping their training schemes going.

In an article in the December edition of the journal Work, Employment and Society, the researchers say that "a combination of market intervention and business requirements obliged most employers to sustain training despite the recession." Employers had turned to more cost-effective ways of training, such as online courses.

Professor Alan Felstead and Dr Nick Jewson, of Cardiff University, and Professor Francis Green, of the LLAKES Centre at the Institute of Education in London, said that employers knew they needed training because they had to meet obligations such as "compliance with legal requirements, meeting operational needs and satisfying customer demands".

The researchers analysed data from the National Employer Skills Survey, which showed that total UK training expenditure rose from £38.6 billion in 2007 to £39.2 billion in 2009, a real terms fall of 5% when inflation is considered.

They also examined the British Chambers of Commerce quarterly survey of 2,000 firms, which found that from 2010 to the middle of 2011 more employers said their training had increased recently than said it had decreased. The CBI Industrial Trends survey of 5,000 firms, which looked at predictions about training spend in the year ahead, showed more companies over the same period were positive than negative about training.

In their interviews with managers from 52 companies, including engineering, legal, food-making and construction firms, the researchers found that "interviewees were virtually unanimous in saying that training should not be, and had not been, cut readily or willingly. In addition to awareness of their statutory obligations, they expressed a widespread belief in the strategic contribution of training to productivity.

"A clear majority of the respondents had modified their training regimes without entirely abandoning them. They typically reported some retrenchment in expenditure, often as part of general cost cutting.

"Respondents also expressed their commitment to the maintenance of training coverage, not only with respect to statutory minimum training and mandatory continuing professional development, but also for longer-term skills enhancement and succession planning. Even in organisations that had suffered redundancies and short-time working, some efforts had been made to protect and preserve training.

"Respondents across the sample suggested that the quality of products and services was central to their market competitiveness, which in return reflected their investment in training. This edge became more, not less, significant when customers were hard to find during a recession.

"The general pattern among the respondents was for a retrenchment in training expenditure to be accompanied by a commitment, as far as possible, to maintaining training coverage. As a result, many were actively and consciously seeking more cost-effective ways of delivering training. These developments can be summarised as focusing training on business needs, shifting from external to in-house provision, and increasing the use of on-line and e-learning.

"An overwhelming majority recognised that their enterprises were subject to a range of 'training floors'; that is, forms of training which are indispensable. These included compliance with legal requirements, meeting operational needs, countering skills shortages, addressing market competition, fulfilling managerial commitments, and satisfying customer demands. As a result, employers reported a widespread reluctance to dispense with training altogether and a determination to defend its 'must have' elements."

###

Work, Employment and Society is published by the British Sociological Association and SAGE.

For more information, please contact:

Tony Trueman
British Sociological Association
Tel: 07964 023392
tony.trueman@britsoc.org.uk

Notes

1. Professor Felstead and Dr Jewson work at the Cardiff School of Social Sciences, Cardiff University, and Professor Green works at the ESRC Centre for Learning and Life Chances in Knowledge Economies and Societies (LLAKES), Institute of Education, University of London.

2. Work, Employment and Society is a leading international peer-reviewed journal of the British Sociological Association which publishes theoretically informed and original research on the sociology of work. Work, Employment and Society covers all aspects of work, employment and unemployment, and their connections with wider social processes and social structures. This journal is a member of the Committee on Publication Ethics (COPE).

3. SAGE is a leading international publisher of journals, books, and electronic media for academic, educational, and professional markets. Since 1965, SAGE has helped inform and educate a global community of scholars, practitioners, researchers, and students spanning a wide range of subject areas including business, humanities, social sciences, and science, technology, and medicine. An independent company, SAGE has principal offices in Los Angeles, London, New Delhi, Singapore and Washington DC. www.sagepublications.com

4. The British Sociological Association's mission is to represent the intellectual and sociological interests of its members. The BSA is a Company Limited by Guarantee. Registered in England and Wales. Company Number: 3890729. Registered Charity Number 1080235.

Disclaimer: AAAS and EurekAlert! are not responsible for the accuracy of news releases posted to EurekAlert! by contributing institutions or for the use of any information through the EurekAlert system.