In a strange twist of fate, during COVID-19, when millions lost their jobs or were furloughed, thousands of business went under and even coins are in shortage, many companies in the training industry are doing well compared to other industries. Training Industry’s market research puts global L& D spending at $370.03 billion last year but projects a 5% contraction this year. It’s no surprise; if there were a good measurement of the uncertainty and anxiety flooding our industry this year, we could put ourselves in the “Guinness Book of World Records.”
The good news: Training Industry expects our industry to grow by 3% in 2021.
This growth helps to explain the accelerated pace of private equity’s taking control of more and more of our industry, either through direct acquisitions or by financing mergers and acquisitions.
What’s Behind the Growth
Why is the training industry still on its feet? Training companies are responding to market needs that were unanticipated — unimaginable — a year ago. The pandemic and subsequent quarantine required organizations to train their learners on the virus itself — how to prevent catching or spreading it, in particular. It also forced many organizations to send their workers home for months or longer.
Many employees will remain working remotely well into 2021 — if they ever return to the workplace. These newly remote employees needed training on how to work remotely, manage remote workers, use web-conferencing tools and practice related etiquette, become virtual collaborators, cope with the stresses of working from home, and understand what to do when business locations reopen.
Another training demand was ignited by the killings of George Floyd and Breonna Taylor. During the subsequent galvanized focus on racial justice, organizations wanted training on inequity and injustice in the workplace, sensitivity toward marginalized groups, and diversity and inclusion. Organizations have also more heavily invested in soft skills like communication, change management, conflict resolution and interpersonal relations.
Additional explanations for the health of our industry include:
Not a Perfect Checkup
Economic growth is a good measure of health, but it’s not the only one. Is it healthy that, like in other industries, training is being controlled by fewer and larger entities, making it harder for small or niche training companies to compete — or survive? What’s the pedagogical cost of having fewer approaches to content, instructional design and product development? Will small businesses and nonprofit customers be ignored or priced out of the market by commission-driven salespeople?
Is it a good trend that more and more of our industry is controlled by private equity firms with little or no training experience, motivated by quickly growing and selling portfolio assets? That a common private equity tactic is radically reducing expenses — such as reducing or eliminating internal learning and development (L&D) departments? Is it good for L&D professionals and learners when options are narrowed, and, in too many cases, customer service seems like an afterthought?
Like survivors of an economic train wreck, we have much to be grateful for. We’re in the midst of a historic paradigm shift regarding the nature of work itself that should keep our industry humming for a good long while. At the same time, we must not lose sight of the problems associated with growth. Sometimes, we can be so focused on it that we overlook the holistic purpose of the training industry.