As a business owner, when you hear the word “recession,” your mind immediately goes to ways you can make changes to save on your bottom line.
But your approach to savings shouldn’t be to cut programs that your employees have asked for—in fact, it could even be the time to double down on what you’re currently offering them.
COMPANIES THAT OFFER TRAINING PROGRAMS HAVE 218% HIGHER INCOME PER EMPLOYEE THAN THOSE THAT DON’T INVEST IN TRAINING AND DEVELOPMENT.
Employees have time and again listed skills training and professional development opportunities as one of the leading factors behind their decision to take a new job. 68 percent of workers say they would stay with their employer throughout their career if the employer made an effort to upskill them.
Workers need skills development opportunities, and employers know this, that’s why many businesses have responded by enacting changes to allow for more of these opportunities. It’s also why you shouldn’t be so quick to make cuts to these during a recession.
DON’T CUT PROFESSIONAL DEVELOPMENT DURING A RECESSION
Many businesses have lost a lot of people to other jobs, especially in the past couple of years. The demand for top talent in all industries is still extremely high, and hiring has not slowed down.
If you speak to any business owner, they will tell you that they are looking for top talent. They want high-quality people to fill these roles. This starts at the leadership level and the value your company puts on its company culture.
If you want to both hire and retain talent, you need to invest in skills training and professional development. Many companies may elect to cut costs on these things because of the initial savings, but there comes with that an immediate side effect.
- The downside to cutting professional development: You run the risk of creating unintended negative impacts like decreased engagement and productivity and losing top talent who are poached by more aggressive competitors. It can create a vicious cycle.
- This is what employees want most: According to the Global Talent Trends Report, 59% of professionals around the world say training and professional development are what attract them to a new company. Why? Because it shows them you care about their well-being. Companies that offer training programs have 218% higher income per employee than those that don’t invest in training and development.
INVESTING IN TRAINING EMPLOYEES THE RIGHT WAY
During a recession, your business needs to be able to adapt to save money—this can mean anything from cutting hours of operations to cutting other nonessential expenses like office expenditures and operational costs.
But investing in your current staff and providing them with training and growth opportunities is another great way to show your business’s willingness to adapt. You also get the added benefit of saving on the cost of hiring and training a new employee, which can be added to your bottom line.
The cost of training an employee is about $1,071, and this number changes depending on the industry and location. Some studies predict that every time a business replaces a salaried employee, it costs 6 to 9 months’ salary on average. So, investing in skills training, professional development and growth opportunities can help companies save by keeping the talent they have.
Investing in training shows employees you are willing to:
- Treat them right: It’s another step toward becoming an employer of choice. It helps you compete against businesses that might offer better compensation, shows that you care about their wants and needs, that you have confidence in them, and that there is growth potential within that business. It increases morale and productivity and makes your business appeal to others.
- Train them right: Training your employees the right way can help you save in the long run. It’s the difference between hiring an employee for 1 year and retaining employees for the next 3 or 5 years. When you train people well, they are going to take care of your business. You’re going to enjoy working with them, they’re going to enjoy working with you and they will help you recruit other people.
INVEST IN YOUR EMPLOYEES
This recession won’t last forever, and you want to make sure you can take care of your employees in the short term to make sure you can keep them for the long term.
Investing now in your staff is mutually beneficial for a business owner and its employees. By giving them opportunities to receive skills and professional development training, you are showing them you care about them and want to keep them.
If you want to retain employees, boost morale and attract employees for the future, then you need to be prepared to give employees what they need, and right now what they need.