Forget that an economic slowdown is the best time to educate an idle workforce, and that studies show that companies that invest in training are more likely to succeed. When times are lean, the training department is often the first casualty. Training is perceived as a feel-good, expendable perk.
"We hear training budgets are being cut and demand for training from outside training vendors is down," says Pat Galagan, editor-in-chief of the magazines published by the American Society for Training and Development. "Training is the first to go in an economic slowdown, especially routine kinds of training, like orientation."
According to Training magazine's 2000 Industry Report, 11 percent of companies of all sizes say training budgets have been slashed since the previous year. Anecdotal evidence suggests that more cuts are imminent. "There's a lag cycle for the training economy," says Pam Schmidt, executive director of Instructional Systems Association, a Lake Ridge, Virginia-based organization for training vendors. ISA members didn't start seeing project slowdowns until February of this year, she says. "But, if the economy picks up again in December, the training economy won't pick up until June."
Meanwhile, training departments and vendors are preparing to do more with less. In companies that place little value on training and those that are going into survival mode as the economy continues to weaken, everything and everyone in the training department is at risk -- from personnel and classroom spending
to investments in new projects.
In companies that still acknowledge the value of training but don't have as much money to spend, cuts are less severe. Even the trainers whose jobs may be secure are relying on cheaper and more informal approaches to training, such as mentoring programs and on-the-job coaching. They have learned that there are still ways of educating employees until the economy bounces back.
Workforce, October 2001, pp. 82-88 -- Subscribe Now!