How Much Should You Be Investing in Employee Development?

According to Bersin by Deloitte, High-Impact Learning Organizations spend about $1,000 per employee on employee development and deliver approximately 20 hours per employee per year on employee development programs.

Do you know how much your company invests in employee learning? I have managed several learning organizations and have had budget responsibility numerous times. In one case, I had a budget that was just a bit higher that the $1,000 and in another case, I had a budget that was close to $400. 

In the case of the $1,000, I led a high-performing learning organization. We had a great team. We made a direct impact on business results. And we were sought out by other in the company. It was great. In the case of the $400 budget, we under-performed, were constantly questioned about why we could not do more (or better) training. And this was in an organization that talked highly about how much it invested in training for its people. It was not a good time.

So I suggest to you this…..if you are in a situation where you are interviewing for a training leadership position, ask this question, “How much do you expect to invest in developing employees?” The hiring manager will likely not have any idea and frankly, if he/she is smart, she will say, “I don’t know, that is why I am hiring this position….so someone can tell us that.”

If you advise them (and do this during the interview process) that they should be investing close to the $1,000 per employee per year figure, and you get anything but a position reaction, consider not taking that job. It might not seem like it at the time, because…hey, you want a job…but in the long run, you know that you cannot be successful if your company is only willing to invest $400 - $600 per employee per year.

If the company has 3,000 employees, they should be investing about $3 million in employee development. Know this number.

Does anyone have any other opinions? What do your experience tell you? Where have I done wrong?